Digital technology has brought all sorts of conveniences into our lives, but these conveniences might come at a significant cost for some people. Our daily activities leave a trail of information behind, which is accessible to credit reporting agencies (CRAs). Employers often ask to conduct credit checks as part of the hiring process. The Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., offers some protection to job applicants by making this process reasonably transparent. An employer must provide job applicants with various disclosures, particularly if it decides not to hire an applicant because of information in their credit report. A proposed class action currently pending in New Jersey claims that a transportation network company (TNC), also known as a rideshare company, failed to provide disclosures required by the FCRA to prospective drivers. Cuccinello v. Uber, Inc., No. 2:15-cv-06604, am. complaint (D.N.J., Dec. 7, 2015). The complaint also alleges FCRA violations against a CRA.
A person’s credit report potentially includes their complete financial history for the previous seven years, if not longer, along with other information about their current life and history. This might include criminal convictions and arrests, marriages, divorces, and children. In order to protect people’s privacy, the FCRA places restrictions on the CRAs that collect consumer credit information and issue credit reports, as well as on individuals and businesses that request those reports.
An employer that wants to obtain a job applicant’s credit report must give the applicant “a clear and conspicuous disclosure,” stating that it intends to use the report “for employment purposes.” 15 U.S.C. § 1681b(b)(2)(A). The disclosure must be provided “in a document that consists solely of the disclosure.” Id. The job applicant must consent in writing to the issuance of a credit report for this purpose. CRAs are not permitted to issue a credit report unless the employer certifies that it has complied with these provisions. Id. at § 1681b(b)(1).
If an employer makes an adverse decision based, in whole or in part, on information in a credit report, the FCRA first requires the employer to provide the applicant with a copy of the report and a written statement explaining the applicant’s FCRA rights. Id. at §§ 1681(b)(b)(3)(A), 1681g(c). Willful violations of these requirements could result in civil liability to the job applicant for their actual damages between $100 and $1,000, attorney’s fees, and punitive damages. Id. at § 1681n. Liability for negligent violations could include actual damages and attorney’s fees. Id. at § 1681o.
The plaintiffs in Cuccinello applied to be drivers for the defendant TNC in 2014, but they were denied employment. They allege in their complaint that the TNC required them to sign forms consenting to background checks, but the form “did not consist solely of the disclosure that a consumer report may be obtained for employment purposes.” Cuccinello, am. complaint at 2-3. They further allege that the TNC did not provide them with copies of their credit reports, as required by the FCRA, prior to taking adverse action with regard to their employment applications. Finally, they allege that the defendant CRA issued the credit reports despite the TNC’s non-compliance with its obligations under the FCRA. They are seeking statutory damages for both willful and negligent violations.
If you need to speak with an civil rights lawyer in New Jersey or New York, contact the Resnick Law Group today online, at 973-781-1204, or at (646) 867-7997 to schedule a confidential consultation with a member of our team.
More Blog Posts:
NLRB Rules Against Company that Prohibited Employees’ Smartphone Use at Work, The New Jersey Employment Law Firm Blog, February 25, 2016
Job Applicant Claims Employment Background Check Violates Federal Law in New Jersey Lawsuit, The New Jersey Employment Law Firm Blog, December 27, 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