Tag: insufficient background check disclosures

Employer Agrees to $600,000 Settlement Over Insufficient Background Check Disclosures October 5, 2022 A major California-based provider of general business services has agreed to pay $600,000 to resolve claims that it violated the Fair Credit Reporting Act (FCRA). The provider allegedly provided insufficient disclosures before performing pre-employment background checks. According to the complaint, these disclosures included extraneous information violating the FCRA’s requirement that a disclosure is “clear and conspicuous” and “consists solely of the disclosure.” The plaintiff brought this class action lawsuit after working with the defendant. The defendant provides various services, including facilities management, manufacturing, logistics, and supply chain management. The plaintiff alleges that the defendant acquired a background check report as part of her employment application. According to the complaint, the defendant provided the plaintiff with a disclosure containing various headings for states and cities where the plaintiff did not reside. The FCRA requires employers to provide applicants with a disclosure explaining how the employer may use information attained from a background check to make adverse employment-related decisions. This disclosure must be in writing following standards set out in the FCRA. Furthermore, employees must agree to permit the employer to perform a background check before starting the process. The case alleges that the inclusion of this language fails to meet the requirements of Sections 168 lb(b)(2)(A) and 1681 d(a) of the FCRA in several ways. One such failure includes multi-state information, which reduces the clarity of an applicant’s rights under the FCRA. Therefore, the FCRA disclosure cannot include multi-state information to reduce confusion. Additionally, the complaint alleges that the disclosure did not identify the rights of California applicants, which further makes the rights of the plaintiff and other class members unclear. This settlement will benefit individuals for whom the employer performed a background check concerning applications or employment between January 28th, 2015, and December 31st, 2021. This settlement further breaks down into two subclasses: a five-year subclass covering January 28th, 2015-January 27th, 2018, and a two-year subclass covering January 28th, 2018-December 31st, 2021. The employer has admitted no wrongdoing thus far but has agreed to resolve the insufficient background check disclosure allegations. The settlement ended with the employer paying $600,000, and the settlement fund will divide the net into a 40-60 split. The five-year subclass will receive equal payments from the 40% split. The two-year subclass will receive equal amounts of the remaining 60%. Make sure your company policies are compliant with State law by reading up on fair chance hiring practices. Learn more by downloading our free resource on Adverse Action Notice Protocols in Compliance With FCRA. Source

Tag: insufficient background check disclosures

Employer Agrees to $600,000 Settlement Over Insufficient Background Check Disclosures

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