Background checks have become an integral part of the hiring process for many employers, landlords, and other service providers.
However, errors in these checks can have severe consequences for individuals, leading to lost job opportunities, housing denials, and other negative outcomes. This has resulted in many lawsuits against background check companies and employers.
Here’s a look at the issue of lawsuits over errors in background checks.
Common Types of Background Check Errors
Background check errors can occur for various reasons and take different forms:
- Mixed files: Criminal records belonging to someone with a similar name are mistakenly included in the report.
- Incorrect information: Criminal record details are reported inaccurately, such as wrong dispositions or severity of charges.
- Reporting of expunged or sealed charges: Information that should have been removed from records appears on the report.
- Misreporting of alternative dispositions: Participation in diversion programs may be incorrectly reported as convictions.
- Duplicate reporting: The same criminal record appears multiple times, making the history seem more extensive.
- Outdated information: Arrests or charges older than seven years that should not be included.
Legal Framework: The Fair Credit Reporting Act (FCRA)
The Fair Credit Reporting Act (FCRA) is the primary law governing background checks. Enacted to protect consumers, the FCRA sets standards for collecting, disseminating, and using consumer information, including background checks.
Employers must comply with several key provisions under the FCRA. They must inform applicants in writing that a background check will be conducted and obtain written permission before moving forward.
If an employer decides not to hire based on the background check, they must give the applicant a copy of the report and information on how to dispute it.
Additionally, background check companies must follow reasonable procedures to ensure the maximum possible accuracy of the information they provide.
Harm Caused by Background Check Errors
Errors in background checks can have devastating consequences for individuals:
- Lost job opportunities: Inaccurate criminal history can lead to immediate disqualification from employment.
- Housing denials: Errors can prevent individuals from securing rental properties.
- Emotional distress: The stress and humiliation of being wrongly accused or denied opportunities can be significant.
- Financial hardship: Lost wages and opportunities can lead to severe financial difficulties.
Steps for Individuals Facing Background Check Errors
If you believe your background check has errors, you can take the following steps:
- Ask for a copy of the background check report from the employer or potential employer.
- Identify the source of the error in the report.
- File a dispute with the background check company, providing evidence to support your claim.
- Consider seeking legal assistance if the errors are not corrected or if you’ve suffered significant harm.
Seeking Legal Help for Background Check Errors
Background check errors can have significant and far-reaching consequences. If you are harmed by inaccuracies in a background check, it can be important to consult with a consumer lawyer specializing in Fair Credit Reporting Act (FCRA) cases.
Importance of Consulting a Consumer Lawyer
A consumer lawyer with knowledge of FCRA cases can provide invaluable assistance in navigating the complex process of disputing inaccuracies in background checks.
These legal professionals are well-versed in the intricacies of federal and state laws governing consumer rights and can help ensure that your dispute is handled correctly and effectively.
Most consumer lawyers take cases on a contingent fee basis, meaning you do not pay any fees or costs unless the lawyer wins your case.
Steps to Take When Seeking Legal Help
- Identify and Document Errors: Review your background check report for inaccuracies or outdated information. Gather supporting documentation to substantiate your claims.
- Consult a Consumer Lawyer: If the errors have caused significant harm, seek immediate legal assistance. Many consumer lawyers offer free consultations to review your case and advise on the best course of action.
- Legal Representation: A consumer lawyer can help draft an effective dispute letter, represent you in negotiations with the background check company, or, if necessary, in court.
Benefits of Legal Assistance
Consulting with a consumer lawyer offers several advantages:
- Expertise in navigating the legal system
- Proper documentation of your dispute
- Negotiation skills to work with background check companies and employers
- Ability to file a lawsuit, if necessary, seeking compensation for damages.
Notable Lawsuits and Settlements
Several high-profile lawsuits have been filed against background check companies and employers for FCRA violations:
- Bailey and Carrasco Jr v. Romanoff Floor Covering, Inc.: This class action lawsuit resulted in a $1.375 million settlement for alleged misuse of consent forms and improper background checks.
- Job Golightly v. Uber Technologies, Inc.: A class action case with 80,000 potential class members alleging unlawful use of criminal history to discriminate against drivers.
- Magruder v. Capital One, Nat’l Ass’n: The court ruled that emotional harm caused by background check errors was enough to establish standing in a lawsuit.
- Moore v. Facts on Demand: A woman sued a background check company for including information over seven years old in her report, which led to a job rejection.
FCRA Laws: California vs. Other States
While the FCRA operates at the federal level, many states have their own versions of the law. California’s version, known as the Investigative Consumer Reporting Agencies Act (ICRAA), provides more protections beyond the federal FCRA.
Here are some key differences between California’s FCRA laws and those of other states:
- California’s law is considered one of the most stringent state versions of the FCRA.
- It allows for direct action against furnishers of information for inaccurate reporting, but under federal FCRA, furnishers are only liable after a dispute is filed.
- California has a much higher statutory penalty of up to $10,000 per violation compared to other states. The exact penalty amount may vary depending on the specific violation and circumstances.
- California limits the reporting of criminal convictions to 7 years, while the federal FCRA allows for indefinite reporting of convictions.
- Under California law, arrest and indictment information must be removed after 7 years, and arrests/indictments that did not result in a conviction must be removed immediately.
- California law applies to employers who conduct their own background checks, not just third-party agencies, unlike the federal FCRA.
- California uses different terminology – background check companies are called Investigative Consumer Reporting Agencies (ICRAs), and background checks are called Investigative Consumer Reports (ICRs).
- California requires employers to provide a copy of the background check report within 3 days of receiving it if requested by the applicant.
- California’s definition of an investigative consumer report is broader, including information obtained through “any means,” not just personal interviews.
It’s important to note that while California has some of the most comprehensive state-level FCRA laws, other states like New Jersey, Oregon, and New York also have their own provisions that may differ from the federal FCRA. Employers operating in multiple states must be aware of federal and applicable state laws to ensure compliance.
Summary
Lawsuits over errors in background checks highlight the critical importance of accuracy in these reports. As background checks play a significant role in employment and housing decisions, individuals must be aware of their legal right to hold companies accountable for inaccurate reporting.
The ongoing legal challenges serve as a reminder of the real-world consequences of these errors and the need for continued improvement in the background check industry.
For those affected by inaccuracies, seeking legal assistance from a consumer lawyer specializing in FCRA cases can be an essential step toward rectifying the situation and seeking appropriate compensation.