adverse action

Advanced 👥 Human Resources

Definition

Any employment decision that negatively affects a candidate or employee based on background check information, requiring specific legal notifications under the FCRA. It's when your past catches up with you in triplicate forms.

Example Usage

The company had to provide adverse action notice before rescinding the job offer based on the candidate's credit report.

Origin

Codified in the Fair Credit Reporting Act of 1970, expanded over subsequent decades

Fun Fact

Employers must provide adverse action notices in two stages—pre-adverse and final adverse—giving candidates a chance to dispute inaccurate information before losing opportunities.

Source: Fair Credit Reporting Act and employment law

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