March 21, 2023

Volume XIII, Number 80


March 20, 2023

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Employment Background Check Class-Action Litigation: Avoiding the Seemingly Minor Mistakes Fueling a Costly Wave of New Lawsuits

Federal courts, most notably the Ninth Circuit Court of Appeals, have recently taken an increasingly hyper-technical view of employer obligations under the Fair Credit Reporting Act (FCRA) in conducting applicant background checks, including criminal background checks. The result has been a growing wave of costly FCRA class-action lawsuits over seemingly minor issues – such as the wording and formatting of employers’ FCRA disclosures to applicants.

Please join Bob Nichols and Amber Dodds for a 30-minute practical consideration of how employers can design and implement their background check process to avoid expensive FCRA litigation.

Key issues to be addressed include:

  • Understanding the nuances of the FCRA’s standalone disclosure requirement, such as:

    • Whether federal and state fair credit reporting notice requirements may be combined in the same document.

    • What well-intentioned explanations or other information, if included in the FCRA disclosure, may render the process unlawful.

    • How to satisfy the “clear and conspicuous” requirement for the FCRA disclosure.

    • The timing and formatting considerations for FCRA disclosure and authorization documents.

  • ​​​​​​​Assuring that your Consumer Reporting Agency (CRA) is meeting its independent obligations with regard to background checks.

  • Properly making the required certification to your CRA concerning your actions.

  • Understanding the content and timing requirements for the two-step adverse action process when rejecting an applicant based upon a background report.

  • Recognizing the unique requirements of some state fair credit reporting laws.

© 2023 Bracewell LLPNational Law Review, Volume XI, Number 84

About this Author

Robert Nichols, employer litigation attorney, bracewell law firm, lawyer harassment claims, wrongful discharge case, occupational safety issues

Robert Nichols represents employers in litigation, administrative actions and arbitrations concerning discrimination and retaliation, harassment, wrongful discharge, occupational safety and health, union-management relations, wage and hour matters, and other concerns related to employment. Mr. Nichols has defended more than 200 employment-related lawsuits in federal and state court, represented employers in more than 300 federal and state agency employment discrimination investigations, and handled numerous Occupational Safety and Health Administration (OSHA) cases,...

Amber K Dodds, Labor and Employment Attorney, Bracewell Law

Amber Dodds represents employers in labor and employment issues, including matters related to wages, wrongful termination, discrimination, occupational safety, and employee benefits disputes.

Prior to law school, Amber worked with large corporations to procure the necessary employment-based visa documentation for high-level individuals and their families relocating to Central and South America. Managing the immigration process included obtaining birth certificates, marriage licenses, diplomas, police records, and employment records while...