Understanding Your Rights and Legal Remedies
Background checks are a routine part of the hiring process. Employers, gig platforms, and even volunteer organizations use them to verify your history—criminal, employment, credit, and more.
But what happens when the background check contains false or misleading information? The consequences can be devastating: job offers rescinded, income lost, reputations damaged, and stress magnified. Fortunately, the law provides protection, and you have the right to dispute these errors.
This comprehensive guide will walk you through the types of background check errors, your rights under federal law, how to dispute inaccuracies, and what legal remedies may be available if those errors cost you a job or opportunity.
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Why Background Checks Matter
Today’s employers rely heavily on background checks to vet candidates. Some industries require them by law—think finance, healthcare, education, and government. Even gig companies like Uber, Lyft, DoorDash, and Amazon Flex routinely run checks before allowing independent contractors onto their platforms.
A background check may include:
- Criminal history
- Arrest records
- Civil judgments
- Driving records
- Employment and education verification
- Credit reports
- Sex offender registry checks
While most companies use third-party screening firms to gather this information, these firms are not perfect. Inaccuracies can slip in, especially when databases are outdated or when individuals with similar names are confused with one another.
Common Background Check Errors
Mistakes in background reports happen more often than most people think. The most frequent errors include:
1. Mixed Files / Mistaken Identity
This occurs when someone else’s information appears on your background report—usually due to a similar name, date of birth, or Social Security number. If the person has a criminal record or financial issue, it could show up under your name.
2. Outdated or Expunged Records
Some background reports still include arrests or charges that were dismissed, expunged, or sealed by a court. Including such information is not just inaccurate; it may violate federal or state law.
3. Incorrect Criminal Charges
Sometimes, the type or severity of the charge is listed incorrectly—turning a misdemeanor into a felony or misreporting a conviction that never happened.
4. Wrong Disposition or Status
A record might inaccurately state that you were convicted when charges were dismissed or never filed. It may also fail to note that you completed a deferred adjudication program.
5. Duplicate Entries
Some background checks repeat the same charge multiple times, exaggerating the extent of your criminal history.
6. Incomplete Records
Missing case outcomes or court dates can create misleading impressions of unresolved legal issues.
7. Credit Report Errors
Especially relevant for financial jobs, these may include old debts, paid-off accounts still showing balances, or accounts that were never yours.
Your Legal Rights Under Federal Law
The Fair Credit Reporting Act (FCRA) is a federal law that regulates how background checks must be conducted when they are used for employment or contracting purposes. The FCRA gives you several important rights:
1. Notice and Consent
An employer or gig platform must notify you and get your written permission before running a background check. If they don’t, that’s a violation of the law.
2. Pre-Adverse Action Notice
If a company is thinking about rejecting you based on the background check, they must first provide you with a copy of the report and a written summary of your rights.
3. Right to Dispute Inaccuracies
If anything in the report is wrong, you can file a dispute with the background check company. They must investigate and either fix the error or confirm its accuracy—usually within 30 days.
4. Adverse Action Notification
If the company goes through with its decision to deny you the job, they must inform you and provide the name and contact information of the reporting agency that prepared the report.
These protections are there to make the process fair and to ensure that background check companies don’t wreck someone’s future due to carelessness.
What to Do If Your Background Check Has Errors
If you’ve been denied a job or contract based on a background check and suspect the report contains incorrect information, here’s what to do:
Step 1: Request the Report
Under federal law, you are entitled to a free copy of the background check if it was used to take adverse action against you. Ask for it right away.
Step 2: Review It Carefully
Go through each section of the report in detail. Look for incorrect criminal charges, outdated information, or accounts that aren’t yours. Check every court record, date, and disposition.
Step 3: Gather Evidence
Get court documents, dismissal records, or payment confirmations that prove the information is wrong. If your identity was confused with someone else’s, collect identifying documents like your driver’s license or Social Security card.
Step 4: File a Dispute with the Background Check Company
Send a written dispute to the company that issued the background report. Clearly outline the error and attach your supporting documents. Keep a copy of everything for your records.
Step 5: Notify the Employer or Platform
Let the employer or gig platform know that the background check contains errors and that you’ve submitted a dispute. Ask for time to allow the dispute process to complete.
Step 6: Follow Up
By law, the screening company must finish their investigation within 30 days (or 45 days in some cases). Follow up if you don’t hear anything within that time.
Legal Remedies: You May Be Entitled to Compensation
If you lost a job, contract, or other opportunity due to a background check error, you may have a case against the background screening company or data furnisher under the FCRA. Legal remedies may include:
1. Actual Damages
These include wages lost from a job you didn’t get, or even emotional distress caused by the error.
2. Statutory Damages
Even if you can’t show financial loss, you may still recover up to $1,000 per violation if the company failed to follow proper procedures.
3. Punitive Damages
In cases where the background check company willfully violated the law, courts may award extra damages to punish the wrongdoing. These are rare.
4. Attorney’s Fees
If you sue and win, the company may be required to pay your legal fees.
The statute of limitations for filing a claim under the FCRA is generally two years from the date you discovered the violation, or five years from the date of the violation itself—whichever comes first. Don’t delay seeking legal advice.
Who Is Liable for the Error?
Depending on the facts, different parties may be legally responsible:
- The Background Check Company if they failed to ensure the report was accurate and up to date.
- The Employer or Platform if they denied you a job without providing notice or a chance to dispute the report.
- The Data Furnisher (like a creditor or business) if they supplied false information.
A qualified attorney can determine who should be held accountable and whether litigation is the right course of action.
How to Prevent Future Background Check Errors
While you can’t stop background check companies from making mistakes, you can take steps to protect yourself:
1. Run a Background Check on Yourself
Many background check services offer consumers the ability to view their own reports. Run one before applying for important jobs.
2. Check Your Credit Reports
Get your free annual credit reports and review them for errors or accounts that don’t belong to you. Dispute anything inaccurate.
3. Update Your Records
If you’ve moved recently or changed names, make sure your current info is updated across banks, courts, and public agencies.
4. Expunge Old Records
If eligible, you can seek to seal or expunge old charges so they won’t appear in future background checks.
5. Keep Copies of Legal Documents
Always keep court dismissal orders, expungement certificates, or letters showing completed probation. These can be used to fix errors if they pop up again.
Background check errors aren’t just frustrating—they can change the course of your life. Whether you’re applying for your dream job or trying to earn a living as an independent contractor, a false or outdated record can close doors that should be open to you.
Knowing your rights under federal law, acting quickly to dispute inaccuracies, and getting legal help when needed can make all the difference. Don’t let someone else’s mistake cost you your future.
The Fair Credit Reporting Act is a Federal Law that protects consumers from errors on Employment Background Check Reports.
WE CAN GET YOU COMPENSATION FOR YOUR EMPLOYMENT BACKGROUND CHECK ERRORS