CLIENT ALERT – Updates to Fair Credit Reporting Act Effective July 21, 2011

Effective July 21, 2011, changes to the Fair Credit Reporting Act (“FCRA”) now require employers to disclose additional information to employees and job applicants when using credit information to make an adverse employment decision. The new disclosure requirements, resulting from the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”), mandate that an employer making an adverse employment decision, based in whole or in part upon an employee’s or applicant’s credit score, disclose new information to the affected person including a numerical credit score, a range of possible credit scores, the key determinative factors of that score, and the contact information for the consumer reporting agency that created the report. The new disclosure requirements under Dodd-Frank are in addition to the existing disclosure requirements under the FCRA. Employers are advised to update their new hire and employee background check documentation to ensure it adheres to federal disclosure requirements.