Aerotek, Inc. Violating the Fair Credit Reporting Act

National University
May 17, 2015
HRM 660

Abstract

The Fair Credit Reporting Act was passed in 1970, and was created to ensure that the collection of credit information and access to your credit records are regulated. This act ensures fairness, privacy, and accuracy of the personal information enclosed in the files of the credit reporting agencies. The Fair Credit Reporting Act is important because Credit Reporting Agencies (CRAs) gather information and create reports on individuals for businesses like employers, credit card companies, banks, and landlords. This act provides security and protection for credit reports, employment background checks, and consumer investigatory reports. Violations of the FCRA can include statutory damages ranging from $100 to $1,000 per violation, actual damages, punitive damages, attorneys’ fees and costs.

History The Fair Credit Reporting Act was passed in 1970, and was created to ensure that the collection of credit information and access to your credit records are regulated. This act ensures fairness, privacy, and accuracy of the personal information enclosed in the files of the credit reporting agencies. Any person or entity interested in your credit report must request permission and provide the reason why they need the information before it is released to them (Fair Credit Reporting Act (FCRA), N.D.). The Federal Trade Commission (FTC) is designated to enforce the provisions of this act. As a consumer, you have the right to know what is on your report, receive one free credit report per year from all credit bureaus, request your credit score (which can be a fee), verify accuracy of the report when it is used for employment purposes, be notified if your file is used against you, dispute and correct information that is not accurate or incomplete, and the ability to remove outdated, negative information in seven years, or ten years if it is a bankruptcy (Fair Credit Reporting Act (FCRA), N.D.).
Relevancy
The Fair Credit Reporting Act is important because Credit Reporting Agencies (CRAs) gather information and create reports on individuals for businesses like employers, credit card companies, banks, and landlords. This act provides security and protection for credit reports, employment background checks, and consumer investigatory reports. Starting in the 1960s CRAs began selling credit reports to insurers and employers, who then used these reports to deny services or opportunities and individuals had no right to see what was in their file. The abuse in the industry started early, and continued after the Fair Credit Reporting Act was passed. There has been several amendments made to protect us as individuals, more recently in 2003 when Congress established the “Fair and Accurate Credit Transactions Act of 2003” (The Fair Credit Reporting Act (FCRA) and the Privacy of Your Credit Report, N.D.). Aerotek, Inc. is an operating company of Allegis Group, Inc. and is the 4th largest recruiting and staffing agency in the world. In 2010, Aerotek terminated a worker based off of the results of his background, which contained false information like serving time in jail and being convicted of a felony. In this case, the court didn’t allow the worker to sue Aerotek, because it was a staffing firm and not a consumer-reporting agency (Rumbaugh, 2013). The current laws we have now expose the way employers are able to go against the Equal Employment Opportunity Commission guidelines and The Fair Credit Reporting Act.
Strengths
The strengths of the Fair Credit Reporting Act are that companies and organizations often go against the rules and do things illegally. This act places significant restrictions on an employer’s ability to obtain and use credit and background information during the hiring process. It also provides a safeguard for applicants and ensures that they have a fair opportunity