When it comes to litigation and employment background screening, most cases in recent history have involved issues surrounding compliance and the Fair Credit Reporting Act (FCRA). High dollar settlements against companies like Swift Transportation, Publix, and Pizza Hut have taught employers that following the rules laid out in the FCRA regarding how and when disclosure and authorization forms should be presented to applicants is of critical importance. The U.S. District Court’s decision in April of 2015 to dismiss the claim against Paramount Pictures may have, in fact, turned the tide in these types of lawsuits.
Within the last week, however, two cases have been filed against prominent consumer reporting agents (CRAs) which do not mention disclosure or authorization forms at all; instead, at issue in these cases is the handling of the applicants’ personal information and the manner in which adverse information returned against the applicants was adjudicated.
The first case, filed on June 19th, asserts that the CRA named in the suit failed “to follow reasonable procedures to ensure the maximum possible accuracy” of the background checks performed, causing the plaintiff, Luis Guillermo, to suffer monetary and emotional harm.
In 2013, Guillermo applied for a job with Wells Fargo. He was ultimately offered a position with the company, pending a completed and satisfactory background check. Less than a month prior to the plaintiff’s offered first day of work, the CRA provided a completed background check to Wells Fargo which included information regarding a misdemeanor retail theft conviction with a 19-day jail sentence. At that point, Wells Fargo rescinded its job offer to the plaintiff. Guillermo, however, asserts that he was never charged or convicted of any crime; rather, he was issued a municipal citation for a noncriminal offense, since the merchandise in question was valued at less than $100. Wisconsin statute states that conduct punishable by forfeiture is not a crime.
Therefore, the plaintiff alleges that the CRA was in violation of the FCRA because it returned inaccurate and incorrect adverse information to his potential employer. Worse, Guillermo states in his complaint, the CRA also failed to conduct a “reasonable investigation” into the inaccurate information after Guillermo exercised his rights under the FCRA to dispute the report. As a result of the CRA’s conduct, the plaintiff claims “extreme emotional distress, despair, depression, and loss of sleep,” as well as the loss of no less than $30,000 as a result of the denied employment opportunity.
The second case, which was filed June 24th, 2015, is very similar, though it is a class action complaint filed by “John Doe,” who is withholding his name to protect his anonymity and future employment prospects. In Doe’s case, the returned adverse information involved a misdemeanor for which the plaintiff was convicted being returned on the background report as a felony, which disqualified the applicant for the position he was seeking. The employer did reassign Doe to a different job, but the plaintiff asserts that his growth opportunities and reputation were badly damaged by the incorrect information provided by the CRA.
Doe was later able to obtain an expungement of his record in regard to the conviction in question. Over a four month period, the plaintiff requested three times, in writing, that the CRA adjust and correct the erroneous background report, but the CRA failed to respond to any of the three requests.
The implications in these lawsuits are twofold: for applicants, it is important to know what rights are held under the FCRA. For CRAs, it is clear that, as consumers become more educated, it is more important than ever before to exercise extreme care in evaluating and adjudicating applicants’ criminal background reports. The Cedalius Group, the employment background screening provider you can trust, prides itself on conducting conscientious searches that reflect true and accurate information on every applicant. Call us today at 404.963.9862 or visit us online to learn more about how adverse information on an applicant should be reported and handled.
The Cedalius Group offers insight into the background screening industry for educational purposes. We always recommend you consult with your legal counsel to determine practices that best suit your business needs.