Q2 2023 – Compliance Update

SCREENINGS

US Regulatory Enforcement Is A-Coming…

As a professional background screening industry, we are closely watching the actions of our regulators in the United States – the Federal Trade Commission and Consumer Financial Protection Bureau – as they march down a path of asking questions and starting to poke around into the industry. We’d love to think they just want to learn but this typically signals a precursor to increased enforcement activities. These activities are meant to ensure compliance with the Fair Credit Reporting Act, which guides the consumer report (background screening) process. Typically enforcement will be on companies like PlusOne Solutions and as always, PlusOne continually reviews its processes and will remain vigilant in our compliance with the law…while keeping one eye on what the regulators continue to do.

California Dreaming – and NOT in a Good Way

In February 2023, California Senate Bill 809 (SB 809) “Fair Chance Act of 2023,” was introduced and, if passed, would replace existing California laws that prohibit discriminatory background check practices and would limit most private sector employers in the state from conducting criminal background checks on job applicants. This is a most worrisome move from but our industry association, Professional Background Screening Association (PBSA,) is working very diligently on ensuring this law does not pass or impact the work we do.

Michigan Causing Delays and Challenges Again

Michigan has recently enacted a Clean Slate Law, and this is resulting in significant changes to criminal record searches. While the concept of the Law is solid, the administrative process in the courts is not and this has been causing issues while cases are removed that now qualify for automatic expungement under the Law. Frustratingly, much of this is a manual process.

For this reason, until the courts have updated their systems, different courts will have different approaches, including temporarily stopping searches or will only provide 7 years of search history. This is a requirement of the courts to assure that all possible automatically expunged cases do not show up on the public system or clerks’ computers for public record searches.

Most of our clerk-searched courts have already indicated that, if they can perform searches, the process will be very slow while they compare results to the list of automatically expunged cases. Please expect delays. This new process and scope change are out of our control, but we will do what we can to ensure we provide the best search possible under the current situation. Please note – we do continue to offer conditional approvals in some situations which may help expedite the screening process. We will continue to monitor the process, and turnaround times and encourage you to speak with your Customer Success Manager if you have questions.

Right to Repair

Although outside the direct scope of the services we offer most of our customers, we have been monitoring some of the recent right to repair initiatives that are popping up in various states. The right to repair refers to proposed government legislation to forbid manufacturers to impose barriers that deny consumers the ability to repair and modify their own consumer products (e.g. electronic, automotive devices or farm vehicles such as tractors). The desire is to protect the end users of a product from anti-competitive activities by large companies. New York passed the first broad right-to-repair law, in 2022, and presently two dozen states have active legislation. At this stage, most legislation is targeting farm equipment, but we are seeing evidence of application to electronics, which many of our warranty customers may be impacted by and in California (yes, them again) appears to be the first one including appliances in their proposed right to repair (SB244). While the documentation requirements are not too different than other laws, they include requirements related to the use of non-factory authorized service providers that may require some dispatching changes. At present this is under review with the Senate Appropriations Committee but is something for customers to keep an eye on.

Annual FCRA Training 

Thank you to all the customers who completed our annual online Fair Credit Reporting Act (FCRA) training. This important training covers the basics of the FCRA law, the responsibilities of requesting and using consumer reports as well as obligations for the destruction of information. PlusOne Solutions requests an annual certification from Customers to ensure their partnership in remaining compliant with FCRA obligations.