A major international infrastructure group has agreed to settle a class action lawsuit. The suit claimed that the group violated state and federal laws by running employment background checks without proper disclosure. This settlement benefits individuals who applied for employment and had consumer reports pulled about them between August 13, 2019, and February 28, 2022. If approved, the settlement would provide $350,000 total for class members.

This class action lawsuit claims that the company provided applicants for employment with insufficient disclosure. According to the suit, the disclosure did not inform applicants that the company would run background checks on them. As such, the plaintiffs believed the form violated California’s Investigative Consumer Reporting Agencies Act (ICRAA) and the federal Fair Credit Reporting Act (FCRA).

According to the lawsuit, the named plaintiff received a conditional offer of employment on or about June 4, 2020. The plaintiff also explained that the offer depended on a background check’s outcome. With this offer, the plaintiff received a disclosure form requesting consent to perform the screening. However, the disclosure proved insufficient under the FCRA and ICRAA.

This five-page disclosure allegedly contained several extraneous sections. For example, it had a state-specific form that did not apply to the plaintiff and a page labeled “A Summary of Your Rights Under the Fair Credit Reporting Act.” It also included a reference to a missing form, which would have informed him of his rights under California law.

As a result, the plaintiff argued that this form violated the FCRA and ICRAA due to failing to meet the “clear and conspicuous” requirements regarding disclosures for consumer reports. The plaintiff initially filed this action in the Orange County Superior Court, but it later moved to the Central California District Court on August 13, 2021.

In November that year, both parties filed a joint stipulation to stay the case pending mediation. Following this stipulation, the parties resolved the dispute on February 7, 2021. Under the resulting settlement, the employer maintained that they committed no wrongdoing. However, it agreed to the class action settlement of $350,000.

As this settlement clearly illustrates, it is crucial to comply with the numerous state and federal laws governing background checks for employment. Partnering with a trustworthy screening provider is the best way to ensure compliance. In addition, the right partner would demonstrate its experience in dealing with the complex network of laws governing consumer reporting.

Pre-employ makes background checks easy and reliable. Speak with a compliance expert today.

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