Employee Background Check Laws in Minnesota

The Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., is the primary federal law governing background checks. Under the FCRA, employers who use third-party consumer reporting agencies to conduct background checks must: (1) disclose in writing that a background check will be conducted, (2) obtain prior written consent from the applicant, (3) provide a copy of the background check report and a summary of rights before taking any adverse action based on the report, and (4) give the applicant an opportunity to dispute inaccurate information.

The FCRA applies to all employers who use third-party background check providers, regardless of employer size. Employers conducting background checks in-house generally are not covered by the FCRA's disclosure and consent requirements, though they remain subject to other federal laws prohibiting discrimination. The EEOC enforces compliance with Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, which prohibits using background check information in a discriminatory manner based on race, color, religion, sex, or national origin.

Under the FCRA, applicants can dispute inaccurate information with the consumer reporting agency, and the agency must investigate within 30 days. The FTC enforces FCRA violations. Federal law does not establish a federal ban-the-box requirement, though many states have enacted their own restrictions on asking about criminal history during the initial application process.

Minnesota has enacted specific background check laws that are stronger than federal requirements in several respects. Minnesota Statute § 181B.0725 requires employers to provide written notice and obtain written consent before conducting a background check on job applicants. This requirement is broader than the FCRA, as the FCRA only applies when employers use third-party consumer reporting agencies, whereas Minnesota's statute applies to all background checks.

Minnesota Statute § 181B.06 implements a ban-the-box requirement that prohibits employers from inquiring about an applicant's criminal history on job application forms, employment questionnaires, or other written pre-interview materials. Employers may only inquire about criminal history during an interview or after making a conditional offer of employment. This restriction applies to all Minnesota employers, regardless of size. However, certain occupations are exempt, including positions in health care, child care, school districts, corrections, and positions requiring bonding or security clearances.

Minnesota Statute § 13D.05 prohibits employers from requesting or using credit reports or credit information for employment purposes, with limited exceptions for positions involving access to financial information or where state or federal law requires it. This is stronger than federal law, which does not restrict employer access to credit reports.

The state law covers all employers operating in Minnesota. Private employers using third-party background check providers must also comply with the FCRA. Applicants in Minnesota have the right to receive a copy of the background check report and dispute inaccurate information. Minnesota does not have a state-level enforcement agency specifically for background check violations, but violations may be enforced through the Minnesota Department of Labor and Industry and through private civil litigation. Remedies include damages and attorney's fees for knowing violations.

The ban-the-box requirement under Minnesota Statute § 181B.06 does not apply to certain positions, including: positions in health care facilities and home care, child care facilities, school districts, corrections facilities, positions requiring bonding or security clearances, and positions where federal law explicitly requires a criminal background check. However, even when these exceptions apply, employers must still comply with the FCRA's disclosure and consent requirements when using third-party providers.

The credit report restriction under Minnesota Statute § 13D.05 has exceptions for: (1) positions where state or federal law specifically requires a credit check, (2) positions with direct access to financial accounts or sensitive financial information, and (3) positions where a credit check is used as part of a comprehensive review and the applicant is notified. However, employers must still document a legitimate business reason for using credit reports.

The FCRA itself contains exceptions: employers conducting background checks entirely in-house without using third-party consumer reporting agencies are not subject to the FCRA's disclosure and consent requirements, though they remain subject to anti-discrimination laws. Additionally, employers may not be required to provide written notice if the background check is used only for hiring decisions made directly by the employer without using a third-party agency.

At-will employment remains the default in Minnesota, and background check rejections are not exempted from at-will termination principles. However, employers cannot reject applicants based on criminal history in a manner that has a disparate impact on protected classes, or based on inaccurate information in violation of the FCRA.

Step 1: Document Everything. If you believe an employer violated background check laws, keep all written communications related to the application process, including job postings, application forms, emails about the background check, and the background check report itself if you received a copy. Document the date when you were told about the background check, whether you were asked for written consent, and any adverse employment decision made based on the background check. Take screenshots of online applications if they asked about criminal history upfront.

Step 2: Request the Background Check Report. Under the FCRA, you have the right to request a free copy of your background check report from the consumer reporting agency. If the employer provided notice that a background check would be conducted, that notice should include the agency's name and contact information. Contact the agency directly and request your report. Review it for inaccuracies and dispute any errors immediately with the agency in writing. The agency must investigate your dispute within 30 days.

Step 3: File a Complaint with the Appropriate Agency. If the employer violated Minnesota Statute § 181B.0725 (by failing to obtain written consent), § 181B.06 (by asking about criminal history on the application), or § 13D.05 (by using a credit report), file a complaint with the Minnesota Department of Labor and Industry (DLI). You can file online at dli.mn.gov or by phone at 651-284-5005. The complaint should include: your name and contact information, the employer's name and location, dates of the alleged violation, detailed description of what happened, and copies of relevant documents (application form, notice of background check, emails, the report itself if you have it).

For FCRA violations, you may also file a complaint with the Federal Trade Commission (FTC) at reportfraud.ftc.gov or by phone at 877-438-4338. You have 3 years to file an FCRA claim in federal court.

Step 4: Understand the Investigation Process. The Minnesota DLI will acknowledge your complaint and may investigate. The investigation typically takes 30–60 days. The agency will contact the employer for their response and may request additional documents from both sides. You will be informed of the investigation status and outcome. If a violation is found, the DLI may issue a cease-and-desist order or refer the matter for enforcement action.

Step 5: Consider Legal Action. If the investigation does not resolve your issue or you prefer faster results, consult an employment attorney. You may have a private right of action under Minnesota law for knowing violations of §§ 181B.0725 and 181B.06, and you may recover compensatory damages and reasonable attorney's fees. For FCRA violations, you can sue in federal court for actual damages (including emotional distress) or statutory damages of $100–$1,000 per violation, plus attorney's fees. Contact an employment law attorney who specializes in background check cases. Many offer free consultations.