Job Applicant Claims Employment Background Check Violates Federal Law in New Jersey Lawsuit

A putative class action is alleging that an internet retailer conducts background checks of job applicants in violation of federal consumer protection law. Information about individuals’ credit history has become critically important for a wide range of purposes. Background checks for criminal history have long been common in the hiring process, but background checks for credit history have also become widespread. The Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., governs access to, use of, and disclosure of consumer credit information for various purposes, including employment. The lawsuit claims that the defendant failed to follow the FCRA’s procedures for use of background information in the hiring process. Feldstein v. LLC, et al., No. 3:15-cv-07322, complaint (D.N.J., Oct. 5, 2015).

The FCRA governs activities by both credit reporting agencies (CRAs), which collect consumer credit information and package it in reports, and individuals and companies that obtain these reports and use them to evaluate individual consumers for various purposes. The FCRA defines a “consumer report” as information collected by a CRA about credit history and various personal details, including criminal history, intended for use in decisions about matters like credit, insurance, or employment. 15 U.S.C. § 1681a(d).

Prior to requesting a report from a CRA, an employer must provide “a clear and conspicuous disclosure…in writing to the” job applicant that they intend to obtain a consumer report, and they must obtain the applicant’s authorization. 15 U.S.C. § 1681b(b)(2). If the employer makes an adverse hiring decision based on information in a consumer report, the FCRA requires it to notify the applicant in advance and provide a copy of the report and a written statement of the applicant’s right to dispute its contents. 15 U.S.C. §§ 1681b(b)(3), 1681g(c).

According to the complaint in Feldstein, the defendant hired a “nationwide employment background screening company” to conduct background checks on job applicants. Feldstein, complaint 3. The plaintiff applied online for a job in April 2015. The defendant extended a conditional offer of employment at its facility in Robbinsville, New Jersey, and invited the plaintiff to a “hiring event” in early May to accept the offer and learn about the facility. Id. at 8. On the day before the hiring event in May, the defendant allegedly received a background report from this company, which incorrectly indicated that the plaintiff had several criminal convictions.

The plaintiff states that he logged onto the website to check the status of his application and found it listed as “failed a contingency.” Id. He claims that the defendant informed him via email that he was no longer a candidate for employment because of the background check. In his lawsuit, the plaintiff alleges that the defendant violated the FCRA by failing to give him advance notice of its adverse decision, a copy of the report, or a notice of his rights. Several other lawsuits are making similar claims. See Williams v. LLC, et al., No. 1:15-cv-07256, complaint (N.D. Ill., Aug. 18, 2015), orig. filed as No. 2:15-cv-00542 (W.D. Wash., Apr. 7, 2015).

The civil rights attorneys at the Resnick Law Group advocate for the rights of job applicants and current and former employees in New Jersey and New York, helping them assert claims under federal and state employment statutes. Contact us online, at 973-781-1204, or at (646) 867-7997 today to schedule a confidential consultation to discuss your case.

More Blog Posts:

Plaintiffs in Genetic Information Discrimination Case Obtain $2.2 Million Verdict Against Employer, The New Jersey Employment Law Firm Blog, August 24, 2015

New York City Prohibits Most Uses of Consumer Credit Reports in Hiring and Other Employment Decisions, The New Jersey Employment Law Firm Blog, July 10, 2015

Former Employee’s Lawsuit Claims Privacy Violations, Wrongful Termination Based on GPS Monitoring, The New Jersey Employment Law Firm Blog, June 18, 2015


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