2015

On March 2, the plaintiff's counsel in Brown v. Delhaize America, LLC submitted an unopposed motion for preliminary approval, seeking Court approval of another FCRA class action settlement. Employers should treat this settlement as another reminder to verify their compliance with the FCRA. According to the parties' settlement paperwork, the Brown case involved two claims that appear frequently in FCRA-based background check litigation. In Brown, the plaintiff claimed that the defendants failed to provide class members with a clear and conspicuous disclosure, consisting solely of the disclosure that a consumer report would be obtained for employment purposes, prior to obtaining the consumer report. After the defendants filed a motion to dismiss and the parties engaged in a two-day mediation, the parties reached a $3 million settlement.

Earlier this year, the New York City Council passed two laws which place limitations on an employer's ability to use background checks including credit checks in employment decisions: the Fair Chance Act (FCA) and the Stop Credit Discrimination in Employment Act (SCDEA). On September 28, 2015, the New York City Commission on Human Rights' (NYCCHR) staff attorney, Paul Keefe, held a question and answer forum for management counsel and employers to inquire about how the NYCCHR will interpret and apply these laws. Employers are encouraged to monitor for upcoming proposed rules, additional guidance on the FCA (including the sample individualized assessment form to be issued), and keep an eye out for updates on the Frequently Asked Questions section of the NYCCHR's website. These new interpretations likely will require employers to consider revising their processes and forms to comply.

A class action lawsuit alleging improper background checks on job applicants was filed in federal court in California against the retail giant Kohl's Department Stores Inc. Lead plaintiff, Kayonie Coleman, alleges in her class action lawsuit that Kohl's conducted illegal background checks on her in October 2012 and June 2013, prior to employment with the department store. She alleges Kohl's used ambiguous and misleading language to obtain credit reports from a class of job applicants in violation of the FCRA. Kohl's joins yet even more retailers who have been hit with FRCA class actions recently, including Whole Foods Market Inc., Dollar General Corp, and Publix Super Markets.