[Congressional Record Volume 144, Number 139 (Wednesday, October 7, 1998)]
[Senate]
[Pages S11806-S11807]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        CONSUMER REPORTING EMPLOYMENT CLARIFICATION ACT OF 1998

  (The text of (S. 2561), the Consumer Reporting Employment 
Clarification Act of 1998, as passed by the Senate on October 6, 1998, 
is as follows:)

                                S. 2561

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Consumer Reporting 
     Employment Clarification Act of 1998''.

     SEC. 2. USE OF CONSUMER REPORTS FOR EMPLOYMENT PURPOSES.

       (a) Disclosure to Consumer.--Section 604(b)(2) of the Fair 
     Credit Reporting Act (15 U.S.C. 1681b(b)(2)) is amended to 
     read as follows:
       ``(2) Disclosure to consumer.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     a person may not procure a consumer report, or cause a 
     consumer report to be procured, for employment purposes with 
     respect to any consumer, unless--
       ``(i) a clear and conspicuous disclosure has been made in 
     writing to the consumer at any time before the report is 
     procured or caused to be procured, in a document that 
     consists solely of the disclosure, that a consumer report may 
     be obtained for employment purposes; and
       ``(ii) the consumer has authorized in writing (which 
     authorization may be made on the document referred to in 
     clause (i)) the procurement of the report by that person.
       ``(B) Application by mail, telephone, computer, or other 
     similar means.--If a consumer described in subparagraph (C) 
     applies for employment by mail, telephone, computer, or other 
     similar means, at any time before a consumer report is 
     procured or caused to be procured in connection with that 
     application--
       ``(i) the person who procures the consumer report on the 
     consumer for employment purposes shall provide to the 
     consumer, by oral, written, or electronic means, notice that 
     a consumer report may be obtained for employment purposes, 
     and a summary of the consumer's rights under section 
     615(a)(3); and
       ``(ii) the consumer shall have consented, orally, in 
     writing, or electronically to the procurement of the report 
     by that person.
       ``(C) Scope.--Subparagraph (B) shall apply to a person 
     procuring a consumer report on a consumer in connection with 
     the consumer's application for employment only if--
       ``(i) the consumer is applying for a position over which 
     the Secretary of Transportation has the power to establish 
     qualifications and maximum hours of service pursuant to the 
     provisions of section 31502 of title 49, or a position 
     subject to safety regulation by a State transportation 
     agency; and
       ``(ii) as of the time at which the person procures the 
     report or causes the report to be procured the only 
     interaction between the consumer and the person in connection 
     with that employment application has been by mail, telephone, 
     computer, or other similar means.''.
       (b) Conditions on Use for Adverse Actions.--Section 
     604(b)(3) of the Fair Credit Reporting Act (15 U.S.C. 
     1681b(b)(3)) is amended to read as follows:
       ``(3) Conditions on use for adverse actions.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     in using a consumer report for employment purposes, before 
     taking any adverse action based in whole or in part on the 
     report, the person intending to take such adverse action 
     shall provide to the consumer to whom the report relates--
       ``(i) a copy of the report; and
       ``(ii) a description in writing of the rights of the 
     consumer under this title, as prescribed by the Federal Trade 
     Commission under section 609(c)(3).
       ``(B) Application by mail, telephone, computer, or other 
     similar means.--
       ``(i) If a consumer described in subparagraph (C) applies 
     for employment by mail, telephone, computer, or other similar 
     means, and if a person who has procured a consumer report on 
     the consumer for employment purposes takes adverse action on 
     the employment application based in whole or in part on the 
     report, then the person must provide to the consumer to whom 
     the report relates, in lieu of the notices required under 
     subparagraph (A) of this section and under section 615(a), 
     within 3 business days of taking such action, an oral, 
     written or electronic notification--

       ``(I) that adverse action has been taken based in whole or 
     in part on a consumer report received from a consumer 
     reporting agency;
       ``(II) of the name, address and telephone number of the 
     consumer reporting agency that furnished the consumer report 
     (including a toll-free telephone number established by the 
     agency if the agency compiles and maintains files on 
     consumers on a nationwide basis);
       ``(III) that the consumer reporting agency did not make the 
     decision to take the adverse action and is unable to provide 
     to the consumer the specific reasons why the adverse action 
     was taken; and
       ``(IV) that the consumer may, upon providing proper 
     identification, request a free copy of a report and may 
     dispute with the consumer reporting agency the accuracy or 
     completeness of any information in a report.

       ``(ii) If, under clause (B)(i)(IV), the consumer requests a 
     copy of a consumer report from the person who procured the 
     report, then, within 3 business days of receiving the 
     consumer's request, together with proper identification, the 
     person must send or provide to the consumer a copy of a 
     report and a copy of the consumer's rights as prescribed by 
     the Federal Trade Commission under section 609(c)(3).
       ``(C) Scope.--Subparagraph (B) shall apply to a person 
     procuring a consumer report on a consumer in connection with 
     the consumer's application for employment only if--
       ``(i) the consumer is applying for a position over which 
     the Secretary of Transportation has the power to establish 
     qualifications and maximum hours of service pursuant to the 
     provisions of section 31502 of title 49, or a position 
     subject to safety regulation by a State transportation 
     agency; and
       ``(ii) as of the time at which the person procures the 
     report or causes the report to be procured the only 
     interaction between the consumer and the person in connection 
     with that employment application has been by

[[Page S11807]]

     mail, telephone, computer, or other similar means.''.

     SEC. 3. PROVISION OF SUMMARY OF RIGHTS.

       Section 604(b)(1)(B) of the Fair Credit Reporting Act (15 
     U.S.C. 1681b(b)(1)(B)) is amended by inserting ``, or has 
     previously provided,'' before ``a summary''.

     SEC. 4. NATIONAL SECURITY INVESTIGATION CONFORMING 
                   AMENDMENTS.

       (a) Government as End User.--Section 609(a)(3) of the Fair 
     Credit Reporting Act (15 U.S.C. 1681g(a)(3)) is amended by 
     adding at the end the following:
       ``(C) Subparagraph (A) does not apply if--
       ``(i) the end user is an agency or department of the United 
     States Government that procures the report from the person 
     for purposes of determining the eligibility of the consumer 
     to whom the report relates to receive access or continued 
     access to classified information (as defined in section 
     604(b)(4)(E)(i)); and
       ``(ii) the head of the agency or department makes a written 
     finding as prescribed under section 604(b)(4)(A).''.
       (b) National Security Investigations.--Section 613 of the 
     Fair Credit Reporting Act (15 U.S.C. 1681k) is amended--
       (1) by inserting ``(a) In General.--'' before ``A 
     consumer''; and
       (2) by adding at the end the following:
       ``(b) Exemption for National Security Investigations.--
     Subsection (a) does not apply in the case of an agency or 
     department of the United States Government that seeks to 
     obtain and use a consumer report for employment purposes, if 
     the head of the agency or department makes a written finding 
     as prescribed under section 604(b)(4)(A).''.

     SEC. 5. CIVIL SUITS AND JUDGMENTS.

       Section 605(a) of the Fair Credit Reporting Act (15 U.S.C. 
     1681c(a)) is amended--
       (1) in paragraph (2), by striking ``Suits and Judgments 
     which'' and inserting ``Civil suits, civil judgments, and 
     records of arrest that'';
       (2) by striking paragraph (5);
       (3) in paragraph (6), by inserting ``, other than records 
     of convictions of crimes'' after ``of information''; and
       (4) by redesignating paragraph (6) as paragraph (5).

     SEC. 6. TECHNICAL AMENDMENTS.

       The Fair Credit Reporting Act (15 U.S.C. 1601 et seq.) is 
     amended--
       (1) in section 603(d)(2)(A)(iii), by striking ``any 
     communication'' and inserting ``communication'';
       (2) in section 603(o)(1), by striking ``(d)(2)(E)'' and 
     inserting ``(d)(2)(D)'';
       (3) in section 603(o)(4), by striking ``or'' at the end and 
     inserting ``and'';
       (4) in section 604(g), by striking ``or a direct marketing 
     transaction'';
       (5) in section 611(a)(7), by striking ``(6)(B)(iv)'' and 
     inserting ``(6)(B)(iii)''; and
       (6) in section 621(b), by striking ``or (e)''.

     SEC. 7. EFFECTIVE DATE.

       The amendments made by this Act shall be deemed to have the 
     same effective date as the amendments made by section 2403 of 
     the Consumer Credit Reporting Reform Act of 1996 (Public Law 
     104-208; 110 Stat. 3009-1257).

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