Employee Background Check Laws in Wisconsin

The Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., is the primary federal law governing background checks nationwide, including in Wisconsin. The FCRA requires that before an employer obtains a consumer report (background check) on a job applicant, the employer must provide clear and conspicuous written disclosure that a background check will be conducted and obtain the applicant's written consent, 15 U.S.C. § 1681b(b)(3)(B)(i). The FCRA applies to all employers who use background checks, regardless of size.

The law prohibits the inclusion of certain negative information: bankruptcy more than 10 years old, lawsuits more than 7 years old, paid tax liens more than 7 years old, arrest records more than 7 years old (unless conviction is more recent), and accounts placed for collection more than 7 years old, 15 U.S.C. § 1681c. Consumer reporting agencies must maintain reasonable procedures to ensure maximum accuracy of all information in the report, 15 U.S.C. § 1681e(b).

If an employer takes adverse action based on information in a background check—such as not hiring the applicant—the employer must provide the applicant with a notice that includes a copy of the report and a summary of the applicant's rights under the FCRA, 15 U.S.C. § 1681b(b)(3)(A). Applicants have the right to dispute the accuracy of information in their report with the consumer reporting agency. The EEOC and the Federal Trade Commission (FTC) enforce the FCRA. Applicants may sue for actual damages or statutory damages of $100 to $1,000 per violation.

Wisconsin has no state-specific background check law that modifies or supplements federal FCRA requirements. Employers in Wisconsin are governed solely by the Fair Credit Reporting Act and its federal standards when conducting background checks on job applicants. This means Wisconsin does not impose stricter disclosure requirements, longer notice periods, or additional prohibited categories beyond what the FCRA establishes.

Wisconsin law does not require employers to inform applicants of their rights to dispute information before the background check is ordered, nor does it mandate a separate state-level adverse action notice. All Wisconsin employers—from small sole proprietorships to large corporations—must follow federal FCRA rules. There are no Wisconsin-specific carve-outs or industry exceptions to the FCRA in Wisconsin law.

However, Wisconsin's common law principles on defamation and invasion of privacy may provide additional remedies to applicants if a background check report contains false, malicious, or intrusive information. Wisconsin case law has recognized that individuals have a right to privacy in personal information and may pursue tort claims against both the employer and the background check company if information is obtained or disclosed unlawfully.

Wisconsin employers should be aware that while they must comply with federal FCRA requirements, they may choose to adopt more protective practices—such as allowing longer time for dispute resolution or providing pre-check notices—without violating state law. Additionally, certain Wisconsin licensing boards or professional regulatory bodies may have their own background check policies that exceed FCRA minimums, though these do not modify the employer's primary FCRA obligations.

The FCRA carves out several important exceptions to the disclosure and consent requirement. Employers do not need to obtain written consent before conducting background checks in connection with an existing employment relationship, though best practice is still to get consent. However, the employer must still provide notice to the applicant if adverse action is taken based on the background check.

Background checks conducted for national security purposes, government agency background investigations, or in connection with certain federal contracts are exempt from some FCRA requirements. Additionally, investigative consumer reports (which involve interviews about personal characteristics, habits, and lifestyle) have slightly different disclosure rules than standard background checks—employers must provide written notice of the right to request a detailed disclosure of the investigation.

Wisconsin employers may also be aware that the FCRA contains an exception for certain background checks ordered by employers in connection with positions requiring security clearances or in sensitive industries (e.g., childcare, elder care). These employers are permitted to order background checks with slightly different consent procedures, though written consent is still required.

Conversely, Wisconsin law does not provide employers with an exception to the FCRA based on the applicant's criminal history or industry. Employers cannot simply assume consent based on prior criminal record or industry practice. At-will employment status does not exempt an employer from FCRA compliance; even in an at-will relationship, the employer must follow FCRA procedures if a background check will influence an employment decision.

Step 1: Document everything related to the background check process. As an applicant, keep copies of any written disclosures provided by the employer, the written consent form you signed, the background check report you received, and any notice of adverse action. Keep detailed notes of when you submitted the authorization form, when the employer said they would notify you of results, and any verbal communications about the background check timeline. Save all emails and letters from the employer or the consumer reporting agency.

Step 2: Understand the internal complaint process. If you discover inaccurate information in your background check report, you do not need to file an internal complaint with the employer first—you can directly dispute the information with the consumer reporting agency that prepared the report. However, if the employer has already taken adverse action (denied your job application), you may want to send a written letter to the employer's HR department explaining the inaccuracy and requesting they reconsider their decision. This creates a paper trail and may prompt the employer to wait for you to correct the report before finalizing their decision. Keep copies of this communication.

Step 3: File a dispute with the consumer reporting agency. Contact the consumer reporting agency listed on your background check report (common agencies include Equifax, Experian, TransUnion, and specialty vendors like First Advantage). Write a detailed dispute letter explaining which information is inaccurate and provide supporting documentation (e.g., court records showing a case was dismissed, proof of payment for a debt, or other evidence). Send the dispute by certified mail with return receipt. The consumer reporting agency must investigate your dispute within 30 days and provide you with a written notice of the results. If they cannot verify the accuracy of the disputed information, they must remove it from your report.

Step 4: File a complaint with the Federal Trade Commission (FTC) if the consumer reporting agency does not respond properly to your dispute or if you believe they obtained the report unlawfully. Visit the FTC's website at www.ftccomplaintassistant.gov or call 1-877-IDTHEFT (1-877-438-4338). You can also file a complaint directly with the FTC's Bureau of Consumer Protection. The FTC does not typically litigate individual consumer cases but investigates patterns of violation. Complaints are typically resolved within 45 days.

Step 5: File a complaint with the EEOC if you believe the background check was used in a discriminatory manner (e.g., the employer applied background check standards differently based on your race, gender, or other protected status). Visit www.eeoc.gov or call 1-800-669-4000. You have 180 days to file with the EEOC in Wisconsin (or 300 days if the state or local agency with which you file first shares jurisdiction). Provide details of the background check, the adverse action, and why you believe discrimination occurred.

Step 6: Consult an employment attorney if you believe you have a case worth pursuing. Consider this after exhausting administrative remedies with the FTC or EEOC, or if you can prove actual damages (e.g., you lost a job opportunity worth a specific salary). An attorney experienced in FCRA litigation can advise you on the strength of your claim and whether a civil suit is worthwhile. Under the FCRA, you can recover actual damages (including lost wages), statutory damages of $100 to $1,000 per violation, attorney fees, and costs.