Pre-adverse action notice: the FCRA step before turning down a driver over a background check

When a pre-adverse action notice is required

You owe the notice whenever a report from a background screening company plays any role in a decision against an applicant or a driver already on staff. The test in 15 U.S.C. 1681b(b)(3) is whether the decision rests on the report “in whole or in part.” The driver background check guide sets out the full FCRA sequence, from the standalone disclosure to the final letter. This entry covers the notice itself. The disclosure the driver signs before the report is the background check authorization form.

Adverse action is broader than not hiring. The FCRA’s definition covers a refusal to hire and any other job decision that works against an applicant or employee, and the FTC’s employer guidance gives reassignment, termination, and a denied promotion as examples. For NEMT, that means the notice comes before you:

• Turn down an applicant over a criminal record, a motor vehicle record, or an employment history check supplied by a screening company.
• Take a current driver off wheelchair or stretcher work after a yearly rescreen.
• Let a driver go over an alert from continuous MVR monitoring.

Two situations fall outside it. A record you look up yourself, on a court website for example, is not a consumer report, because the FCRA definition covers information from a consumer reporting agency. And when an outside investigator looks into suspected misconduct by an employee and reports only to you, your agents, or a government agency, the FCRA takes that report out of the consumer report rules (1681a(y)). After acting on it, you owe the employee a summary of its nature and substance instead.

What goes in the notice

The notice has two required pieces:

1. A copy of the report you relied on. Send the report itself, not your summary of it.
2. The federal rights form. The CFPB publishes it under the title “A Summary of Your Rights Under the Fair Credit Reporting Act.” The current model is the March 2023 version, which corrected federal agency contact details and has been required since March 20, 2024. Appendix K to 12 CFR Part 1022 accepts any form substantially similar to the model and kept current, and an accurate translation into the reader’s language also complies. The FTC says the screening company that sold you the report should have given you a copy.

Nothing else is required by the FCRA, but a short cover letter helps. Name the items that concern you, say how the person can respond, and give the date you plan to decide. Some state and city fair chance laws go further and dictate what the letter says and how long the person gets to answer; the guide to hiring drivers with a criminal record covers California and New York.

How long to wait before deciding

No fixed waiting period appears in the FCRA. The FTC staff report of July 2011 says only that “some reasonable period of time must elapse,” with the minimum varying case by case. It also says an employer may send the report and rights form the moment the screening company delivers them, so the clock can start the day the report arrives.

The point of the wait is the person’s chance to answer. A driver who spots a record that belongs to someone else, or a conviction that was later dismissed, needs time to tell you and the screening company before the seat is filled.

The final adverse action notice

Once you decide, a second notice follows, and it may go by phone, on paper, or electronically (1681m(a)). It names the screening company with its address and phone number, toll-free if the company keeps files nationwide, says the company played no part in the decision, and explains the free copy within 60 days and the right to dispute. The background check guide walks through that notice as the last step of the screen.

Put it in writing even when you also tell the person face to face. A dated copy is your proof that it went out.

Remote applicants for DOT-regulated driving jobs

One exception replaces both notices with a single one. Under 1681b(b)(3)(B) and (C), it applies only when the job falls under DOT’s power to set driver qualifications and hours under 49 U.S.C. 31502, or under a state transportation agency’s safety rules, and the applicant has dealt with you only by mail, phone, or computer when you order the report. FTC staff call it the trucking industry exception.

In that case, a single notice goes out by phone, letter, or email, at most three business days after you decide. It tells the applicant that a screening report drove the decision, identifies that company and how to contact it, makes clear the company did not decide, and explains the free-copy and dispute rights. If the applicant then asks for the report, you send it with the rights form, at most three business days after the request arrives. Once the applicant comes in for an interview or a road test before you order the report, the normal two-notice process applies.

What a missed notice can cost

Skipping the notice exposes the company to a lawsuit by the driver. A willful failure costs actual damages, or statutory damages of $100 to $1,000, plus any punitive damages a court allows and attorney’s fees (1681n). A negligent failure costs actual damages and attorney’s fees (1681o). The driver has until 2 years after discovering the violation, and no more than 5 years after it happened, to sue (1681p).