FCRA Class Actions Against Employers – New Trend?

FTC LogoThere is an interesting article in the SHRM Federal Resources Section about the emerging trend of FCRA Class Actions against employers. The article, written by Allen Smith, SHRM’s manager of workplace law content, discusses the importance of HR professionals to be familiar with FCRA requirements when conducting background checks on employees and applicants.


Employers have responsibilities before they conduct a background check and after if they take adverse action against someone based partly on information obtained from that background check.



Employers must provide a written disclosure to the employee or applicant that consists solely of the disclosure that a consumer report may be obtained. The employee or applicant must provide written permission for an employer to obtain the report.



Employers must provide a pre-adverse action notice to the employee or applicant if it intends to take adverse action based partly on the report’s contents. That notice must include a copy of the consumer report and the statutory summary of rights.


Five Business Days Later

The employer must provide an adverse action notice that includes:

  • The name and contact information of the consumer reporting agency that provided the report.
  • A statement that the consumer reporting agency did not make the adverse decision and cannot explain why the decision was made.
  • A statement outlining the individual’s right to get a free disclosure of his or her report from the consumer reporting agency if the request is made within 60 days.
  • A statement explaining the individual’s right to dispute the accuracy or completeness of any information in the report directly with the consumer reporting agency.


The article goes on to list action items to mitigate class-action risk, but the bottom line is employers need to be familiar and compliant with the law and should “take measures to fortify against class-action risk”.



List of 18 States that Ban Employers From Requesting Access to Social Media Posts

social media iconsPeople love to share information about themselves on social media and employers haven taken notice.  According to 2013 research by the Society for Human Resource Management (SHRM), 20 percent of employers use social media to screen applicants (Facebook, Twitter, LinkedIn or Google Plus). However, 74 percent of employers said they were concerned with legal risks such as discovering protected characteristics like age or religious affiliation. Sixty-three percent said the information on social media sites may not be a good predictor of performance or potential, and 61 percent didn’t think the information was relevant to whether or not the applicant would blend in well with the organization.



States are leading the charge to safeguard individual privacy rights and New Hampshire has become the 18th state to do so.  Below is the complete list of 18 states that ban social media searches for employment purposes:




Arkansas 4/23/13
California 9/27/12
Colorado 5/1/13
Illinois 8/1/12
Louisiana 5/22/14
Maryland 10/1/12
Michigan 12/28/12
Nevada 10/1/13
New   Hampshire 8/1/14
New   Jersey 3/21/13
New   Mexico 4/5/13
Oklahoma 11/1/14
Oregon 5/22/13
Rhode   Island 7/1/14
Tennessee 1/1/14
Utah 3/26/13
Washington 5/22/13
Wisconsin 4/8/14


What does this mean for employers? First, it’s not a best practice to be asking for this type of personal information from employees and applicants or reading their social media postings.

In some states, forcing someone to reveal social media postings is a punishable offense with fines in the range of $500 to $1,000.  Some states allow civil actions to be brought against employers by employees and applicants.


Therefore, employers should ensure that their social media policies follow best practices and are clear and in compliance with the law.

New Jersey Governor Signs Ban the Box Legislation

bantheboxNew Jersey’s Governor Christie  signed the “Opportunity to Compete” Act on Monday, August 11th, for all employers in the State of New Jersey with 15 or more employees. The new law  limits employers from any “oral or written inquiry regarding an applicant’s criminal record during the initial employment application process.”  Employers can make this inquiry after the initial interview.


There are exemptions to the law, which include positions:


  1. In law enforcement, corrections, the judiciary, homeland security or emergency management;
  2. Where a criminal history record background check is required by law, rule or regulation, or where an arrest or conviction by the person for one or more crimes or offenses would or may preclude the person from holding such employment as required by any law, rule or regulation, or where any law, rule or regulation restricts an employer’s ability to engage in specific business activities based on the criminal records of its employees; or
  3. Designated by the employer to be part of a program or systematic effort designed predominantly or exclusively to encourage the employment of persons who have been arrested or convicted of one or more crimes or offenses.

Employers in New Jersey should review their hiring processes and documents to ensure compliance with this new law.