New California Law Clarifies Investigative Consumer Reporting Requirements for Employers

California law governing requests for and use of investigative consumer reports by employers has changed effective immediately. Governor Davis signed legislation on September 29th which modified and clarified employer's obligations when obtaining background information on employees or applicants.

California Assembly Bill 1068: Personal Information and California Assembly Bill 2868: Personal Information Disclosure

Purpose: To clarify the obligations on users and providers of consumer reports and investigative consumer reports as defined under state law.

Effective Date: Immediate -- urgency measures

Consequences: The law clarifies that employers and others who obtain information on a consumer without going through an outside agency do not need to provide the information to the consumer unless the information is a public record, such as a DMV report or criminal conviction history. Employers therefore are not required to provide applicants or employees with reference information obtained prior to employment. Disclosures necessary to request an investigative consumer report must now include a box the consumer can check to receive a copy of the report. The end user can contract with a third party agency to send the report to the consumer rather than having to provide it directly. Employers are now also immune from liability for defamation if they advise prospective employers without malice that they would or would not rehire a former employee.

View full text of AB 2868

View full text of AB 1068