The FCRA background check rules come from the Fair Credit Reporting Act (FCRA), a 1970 federal law on the credit and background reports that consumer reporting agencies (CRAs) sell. The Federal Trade Commission (FTC), state attorneys general and private plaintiffs can enforce it. This page is for owners of U.S. businesses with India or Canada ties, such as a foreign-owned company screening its first Aurora hire.
Who do the FCRA background check rules cover?
| Item | Rule |
|---|---|
| Employer or other user | Covered when it gets a CRA report to evaluate a person for hiring, promotion, reassignment or retention. No size test. |
| What counts as a report | Only a CRA can supply one. A past employer's reference limited to its own dealings with the person is not a consumer report, though state and equal-opportunity law still apply. |
| Contractors, volunteers | FTC staff (2011) say they may be reached. A staff view, not a rule. |
| Illinois | The Employee Credit Privacy Act covers any entity that lets one or more people work or takes applications, with exceptions such as banks and insurers. The Job Opportunities for Qualified Applicants Act (JOQAA) limits early criminal-history questions by private employers with 15 or more employees. |
What does the FCRA mean for a foreign-owned or cross-border business?
| Situation | What the law says | What to check |
|---|---|---|
| Owner or parent lives in India or Canada | Coverage turns on getting a CRA report for a job decision. Owner residence is not a listed test. | List every U.S. role you screen, even the first. |
| Candidate from abroad or on a visa | The steps protect the person evaluated, and the coverage text lists no citizenship or visa exception. | Use one process for all. See hiring US employees from abroad; visa questions go to an immigration attorney. |
Where do I go next?
FCRA rules and checklist has the numbers, changes and the Copy-Before-Cut Screening Ladder. Related: Title VII, the Illinois Human Rights Act, the Cook County Human Rights Ordinance and our U.S. employer checklist.
Frequently asked questions
Does the FCRA apply to a company with one employee?
Yes, if it uses a CRA report to evaluate someone for a job. No employee-count threshold applies.
Does the FCRA ban credit or criminal checks on job candidates?
No. It sets notice and consent steps. Other limits come from Title VII and from Illinois, Cook County and Chicago law.
Official sources
- Federal Trade Commission: Using Consumer Reports, What Employers Need to Know
- Cornell Law School LII: 15 U.S.C. 1681b, permissible purposes of consumer reports
- EEOC: Background Checks, What Employers Need to Know
- EEOC: Commission votes to rescind enforcement guidance on arrest and conviction records
- Illinois General Assembly: Employee Credit Privacy Act (820 ILCS 70), Section 10
This page summarizes public guidance in plain language. If anything here differs from the official source, the official source controls.