Pre-Adverse vs Adverse Action Notice: What Employers Must Send
Updated 12 min read
The two notices side by side
Pre-adverse action notice
- When
- Before any adverse action
- Goes with it
- A copy of the report
- Also goes with it
- A Summary of Your Rights
- Its job
- A chance to correct the report
- Form
- In writing (the Summary)
15 U.S.C. § 1681b(b)(3)(A)
Adverse action notice
- When
- After the action is taken
- Names
- The screening firm, address, phone
- Says
- The firm did not decide
- Rights
- Free copy in 60 days, dispute
- Form
- Oral, written or electronic
15 U.S.C. § 1681m(a)
An adverse action notice is the FCRA letter an employer owes a candidate or employee when a background report helped sink a decision about them. There are two of them, sent days apart. The first warns the person and hands them the report so they can point out a mistake while it still matters. The second closes the file and tells them where to get a free copy and how to dispute it. Both apply when the report played any part in the decision: the statute says “based in whole or in part on the report.”
“a denial of employment or any other decision for employment purposes that adversely affects any current or prospective employee”. Employment purposes include hiring, promotion, reassignment and retention, so a passed-over promotion or a firing based on a report triggers the same two notices as a rejected applicant.
15 U.S.C. § 1681a(k)(1)(B)(ii); § 1681a(h)
FTC staff read the two as separate documents: the first must reach the person before you act and the second after, so they “may not be included in the same document.” If you only remember one rule from this page, make it that one. The rest of the sequence, from the stand-alone disclosure to the certification you give the screening firm, is laid out in our FCRA background check rules for employers.
What to do
- Treat any decision the report touched as adverse action, including promotions and terminations.
- Plan two letters on two dates. Draft both at once with the adverse action letter generator.
- Put the gap between them on the calendar with the adverse action timeline calculator.
Notice 1: the pre-adverse action notice
“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 subchapter”
15 U.S.C. § 1681b(b)(3)(A)
The statute asks for two enclosures and says nothing about a cover letter. In practice the letter is what makes the package usable: it tells the person why they are getting a background report in the mail, which firm prepared it, and when you will decide. The table splits what the law requires from what a careful employer adds.
| Item | Status | Source |
|---|---|---|
| A copy of the consumer report you relied on | Required | 1681b(b)(3)(A)(i) |
| A Summary of Your Rights Under the FCRA (CFPB, March 2023 version) | Required | 1681b(b)(3)(A)(ii) |
| Sent before the decision is final | Required | 1681b(b)(3)(A) |
| A letter naming the screening firm that prepared the report | Practice | Not in the statute |
| Whom to contact, and the date you will decide | Practice | Not in the statute |
| The items in the report that concern you | Practice | Not in the statute |
The Summary of Rights trips people up more than the report does. The current form is the CFPB's March 2023 version, required since March 20, 2024, even though the PDF on consumerfinance.gov still carries a 2018 file name. Our guide to A Summary of Your Rights Under the FCRA covers which edition to use and every other moment it has to go out.
What to do
- Send the report copy you actually relied on, not a summary of it.
- Attach the March 2023 Summary of Rights, downloaded fresh, not an old printout.
- Give a contact and a date, so the person knows how long they have to speak up.
How long to wait between the notices
Federal law sets no fixed number of days. FTC staff wrote that “some reasonable period of time must elapse, but the minimum length will vary depending on the particular circumstances involved.” A 1997 staff letter said a five business day period “appears reasonable,” which is why five business days is the common practice. It is practice, not law.
15 U.S.C. § 1681b(b)(3)(A); FTC staff letter to Weisberg, June 27, 1997
Treat five business days as a floor, not a target. If the applicant writes back to say the report is wrong, the screening firm generally has 30 days to reinvestigate, and up to 15 more if the applicant sends new information during that time. Deciding on day six while a dispute is open defeats the purpose of the first notice. California and New York City do set a number, and they count it from the day the person receives the notice, not the day you send it.
| Email sent Monday, Nov 2, 2026 | Received | Wait runs | Final notice from |
|---|---|---|---|
| Federal, 5 business day practice | Nov 2 | Nov 3, 4, 5, 6, 9 | Tue, Nov 10 |
| California (email deemed received 2 business days later) | Nov 4 | Nov 5, 6, 9, 10, 12 | Fri, Nov 13 |
| New York City (email agreed in advance) | Nov 2 | Nov 3, 4, 5, 6, 9 | Tue, Nov 10 |
Run your own dates through the adverse action timeline calculator: it takes the send date and the delivery method, applies the California or NYC clock when it runs longer than your federal practice wait, and gives the first day the final notice can go out.
What to do
- Wait at least five business days after the pre-adverse notice, longer if the person is disputing.
- In California and NYC, count from receipt and use the local window.
- Write the date you sent the first notice in the file; it is the date your wait is measured from.
Notice 2: the adverse action notice
Once the wait is over and your decision stands, the final notice tells the person it is done and where they can turn. The statute lists its contents item by item, which makes it easy to check before it goes out.
| The final notice must give | Cite |
|---|---|
| Notice that the adverse action was taken | 1681m(a)(1) |
| The screening firm's name | 1681m(a)(3)(A) |
| The screening firm's address | 1681m(a)(3)(A) |
| Its phone number, toll-free if it keeps files nationwide | 1681m(a)(3)(A) |
| That the firm did not make the decision and cannot give the specific reasons | 1681m(a)(3)(B) |
| The right to a free copy of the report, with the 60-day period | 1681m(a)(4)(A) |
| The right to dispute the accuracy or completeness of the report | 1681m(a)(4)(B) |
When a numerical credit score played a part, the notice must also give the score, the range of possible scores, the key factors that hurt it (no more than four, except that a number-of-inquiries factor is always listed), the date the score was created and who provided it. See our guide to credit checks for employment.
15 U.S.C. § 1681m(a)(2); § 1681g(f)(1)(B)–(E), (f)(9)
The 60 days run from the day the person receives the final notice, so a mailed letter starts the clock later than an email. The statute allows the notice to be oral, written or electronic. Send it in writing anyway: it is the only version that proves itself later.
What to do
- Copy the screening firm's legal name, address and toll-free number from its report, not from memory.
- Keep the statement that the firm did not decide, even when the reasons feel obvious.
- Generate the final letter from the same details as the first with the letter generator, so the two never disagree.
The one federal exception: remote applicants for DOT driving jobs
One group gets a single notice instead of two. If the job is one where the Secretary of Transportation sets qualifications and hours of service (or a state transportation safety agency regulates it), and the applicant has dealt with you only by mail, phone, computer or similar means, the FCRA swaps both notices for one.
Within 3 business days of taking the adverse action, give an oral, written or electronic notice that it was based on a report, the screening firm's name, address and phone number, that the firm did not decide, and that the person may ask for a free copy and dispute it. If they ask you for a copy, send the report and the Summary of Rights within 3 business days of the request.
15 U.S.C. § 1681b(b)(3)(B)–(C)
The test is fixed on the day you order the report: if the driver has already come in for an interview or a road test by then, the exception does not apply and the standard two notices do. Our guide to MVR checks for employers covers the driving-record side of a DOT hire.
California and New York City add their own steps
- Federal
- CA
- NYC
When the report shows a conviction, California and New York City layer a fair chance process on top of the FCRA notices. You still send everything the FCRA requires; the local rules add content and a response window that counts from receipt.
| Step | Federal | California | New York City |
|---|---|---|---|
| Who is covered | Any employer using a screening firm's report | Employers with 5 or more employees | Employers with 4 or more employees |
| Criminal history checked | After the stand-alone disclosure and authorization | Only after a conditional offer | Only after a conditional offer |
| First notice adds | Report copy + Summary of Rights | The convictions, the report relied on, the right to respond with evidence | A copy of the inquiry + the Fair Chance Notice |
| Response time | No number; 5 business days is practice | 5+ business days from receipt; 5 more if disputing | 5+ business days from receipt of both; job held open |
| Final notice gives | The 1681m elements | The 1681m elements, plus the decision, any way to challenge it, the right to complain to the CRD | The 1681m elements |
California deems an emailed notice received two business days after it is sent, and untracked mail five calendar days after mailing to a California address (ten elsewhere in the US, twenty abroad). Its preliminary notice may, but need not, explain your reasoning. Step-by-step detail lives in the California Fair Chance Act guide.
New York City allows email only if you and the applicant agreed to it in advance, and failing to hold the position open for at least five business days is a per se violation. If the applicant shows the report is wrong, you redo the analysis on the corrected record and, if you still intend to act, run the full process again. See the NYC Fair Chance Act guide and how to run an individualized assessment.
Minnesota: after adverse action based on a report, tell the person of the right to a copy if they did not already receive one, give the screening firm's name and address, and give notice of the right to dispute and correct errors (Minn. Stat. § 13C.03). New York State: when a report with criminal conviction information comes back, the employer that requested it must give the person a printed or electronic copy of Article 23-A of the Correction Law (N.Y. Gen. Bus. Law § 380-g(d)).
Other states and cities run their own fair chance rules. Check the ban-the-box laws by state and city for your locations before you rely on the federal letters alone.
What to do
- Hiring in California or NYC: send the local notice with the pre-adverse package, so one clock starts.
- Count the local window from receipt and keep proof of delivery.
- Hold the job open until the window closes.
Common mistakes
| Mistake | Why it fails | Fix |
|---|---|---|
| One letter that both warns and rejects | FTC staff: the notices may not share a document | Two letters, two dates |
| Pre-adverse notice without the report or the Summary | Both enclosures are required | Attach both, every time |
| Filling the job during the wait | The first notice exists so the person can respond | Decide only after the wait |
| Counting California or NYC days from the send date | Both count from receipt | Log delivery; use the timeline tool |
| Final notice missing the firm's phone or the 'did not decide' line | Both are listed elements | Check all seven before sending |
| No notices because the report was only one reason | The rule says in whole or in part | Any role in the decision counts |
| Skipping notices for a current employee | Retention and promotion are employment purposes | Same two notices |
Most of these come from treating the pre-adverse notice as paperwork after a decision already made. The notice only does its job when the decision is still open. Getting the start of the sequence right helps too: a clean stand-alone disclosure and authorization means the report you are about to act on was obtained properly in the first place.
A willful FCRA violation can cost $100 to $1,000 per affected person in statutory damages, plus punitive damages and the other side's attorney's fees; a negligent one, actual damages plus fees. Claims must be filed within two years of discovery and no later than five years after the violation.
15 U.S.C. §§ 1681n(a), 1681o(a), 1681p
- Pre-adverse notice goes
- Before the decision15 U.S.C. § 1681b(b)(3)(A)
- Goes with it
- Report copy + Summary of Rights§ 1681b(b)(3)(A)(i)–(ii)
- Summary of Rights edition
- March 2023, required since 2024-03-2012 CFR Part 1022, App. K
- Wait before the final notice
- No federal number; 5 business days is practiceFTC staff letter, 1997
- Final notice elements
- 7, plus score items if a score was used15 U.S.C. § 1681m(a)
- Free copy request window
- 60 days from receipt of the notice15 U.S.C. § 1681j(b)
- California response window
- 5+ business days from receipt2 CCR § 11017.1(c)(2)(E)
- NYC response window
- 5+ business days from receipt of bothNYC Admin. Code § 8-107(11-a)
- Remote DOT driving applicants
- One notice within 3 business days15 U.S.C. § 1681b(b)(3)(B)
Questions employers ask
What does adverse action notice mean?
In hiring, it is the notice the FCRA requires after an employer takes an employment decision against someone based in whole or in part on a background report. Lenders use the same phrase for a different notice: under Regulation B a creditor must notify an applicant within 30 days after adverse action on a completed credit application (12 CFR 1002.9). This page covers the employment notices only.
Can I send the pre-adverse and final notice in one letter?
No. FTC staff say they may not be included in the same document, because one must come before the decision and the other after it.
Can I send the notices by email?
The final notice may be oral, written or electronic under the FCRA. In California an emailed notice counts as received two business days after it is sent; in NYC email works only if you both agreed to it in advance. Keep a record of when each notice went out and how.
Do I have to explain why I rejected the applicant?
The federal final notice does not list your reasons as an element; it must say the screening firm did not make the decision. California's preliminary notice must name the disqualifying convictions but need not explain your reasoning. An individualized assessment record helps you answer if asked.
What if the applicant disputes the report?
The dispute goes to the screening firm, which generally has 30 days to reinvestigate (up to 15 more if the applicant sends new information meanwhile). In NYC, if the applicant shows an error, you redo the analysis on the corrected record and give the full process again if you still plan to act.
Do these notices apply if I ran the check myself?
The FCRA notices apply when the report came from a consumer reporting agency. California's fair chance rules are wider: they cover criminal history found through an application, a background check or an internet search.