Virginia Background Check Laws

Manuel v. Wells Fargo Bank (2015)

Wells Fargo inserted a waiver of liability at the bottom of a disclosure form that informed applicants that a background screening report would be procured. Wells Fargo also did not take proper adverse action when labeling applicants as “ineligible” upon receipt of their report. This was done before sending a pre-adverse action letter, resulting in non-compliance with proper adverse action procedures required by the FCRA.

Settlement. Wells Fargo moved for Summary Judgment claiming that the liability waiver used at the bottom of the disclosure form was proper, and that it was their vendor, First Advantage, that did not adhere to the adverse action process, not Wells Fargo. The Court denied their motion for Summary Judgment. The Court held that the plaintiff suffered the injury of not receiving the information they should have because the liability waiver and the disclosure were on one form. In regards to the Adverse Action process, the Court held that Wells Fargo effectively took adverse action against the applicant upon receiving the label of “ineligible” and they had immediately intended not to hire the individual. When Wells Fargo received the label of “ineligible,” they essentially made their adverse hiring decision without following the adverse action process. Notifying their vendor, First Advantage, to send out the pre-adverse action and adverse action letters, after making a firm decision to not hire the applicant, is in violation of the adverse action procedure set forth by the FCRA.

Employers must ensure that their disclosure and authorization forms are separate documents that do not include any other forms or language pertaining to any other type of document. Courts agree that the disclosure and authorization form must be completely separate from everything else. Applicants have a right to information, and combining forms or adding language not necessary to the disclosure and authorization is strictly prohibited. Additionally, the employer must ensure that they strictly adhere to the adverse action process. The Court notes that employers may not simply just inform their vendors to send out adverse action notices. Employers must still abide by the standards set forth in the FCRA.

Henderson v. Corelogic Nat’l Background Data, LLC (2016)

When providing criminal history information to be used on a background screening report, Corelogic National Background Data (also known as “NBD”) did not propery follow the procedures set forth in section 613. Section 613 states that a CRA must either; (1) notify the consumer that negative information has been found on them and that notification must also include the name and address of the person who will be receiving that information, or (2) the CRA must maintain strict procedures that ensures the accuracy and timeliness of the information collected.

Settlement. This class action suit was settled despite the Court denying the plaintiff’s motion for renewing class certification. The Court notes that neither Corelogic National Background Data (NBD), or the recipients of their information (ADP, HR Plus, and Verifications Inc), meet the standard set forth by section 613 of the FCRA. These entities did not verify the information received, nor did they notify the consumer that negative information was found on them. This amounts to non-compliance of the FCRA.

Employers should vet the CRA whose services they use to ensure that they strictly adhere to maintaining procedures to ensure maximum possible accuracy. Consumer Reporting Agencies must follow the standards set forth by section 613 of the FCRA. The CRA procuring information on consumer must either; (1) notify the consumer that negative information has been found on them and that notification must also include the name and address of the person who will be receiving that information, or (2) the CRA must maintain strict procedures that ensures the accuracy and timeliness of the information collected.

Henderson v. First Advantage Background Services Corp. (2015)

The consumer reporting agency did not adhere to the dispute and reinvestigation procedures set forth in section 1681i because they made it too difficult for an applicant to initiate a dispute.

Settlement. The consumer reporting agency’s procedure for an applicant to initiate a dispute was too difficult because they were requiring the disputing applicant to fill out a specific dispute form as well as provide valid government identification. Applicants seeking to dispute inaccurate information were denied their right to dispute inaccurate information if they did not follow those two procedures. Additionally, the CRA was taking longer than 30 days to perform their reinvestigations. This scenarios amount to a breach of section 1681i and the reinvestigation standards required by the FCRA.

Consumer reporting agencies cannot make it overly difficult for an applicant to dispute inaccuracies on their consumer report. Doing so is in violation of the FCRA. Applicants have the right to dispute inaccuracies in their consumer report, and the CRA must perform the reinvestigation within 30 days of the applicant notifying the CRA of their dispute.

Thomas v. FTS USA, LLC

Plaintiff claims that he was wrongfully terminated due to inaccuracies within his background screening report and he was not allowed to correct those inaccuracies, which violates proper adverse action procedures under the FCRA. Furthermore, it was found that FTS USA never provided the proper summary of rights, disclosure and authorization forms to current or prospective employees. FTS USA was under the impression their vendor would do so.

Certified Class Action. Thomas is the lead plaintiff in this class action lawsuit.

Employers must ensure they follow strict procedures complying with the FCRA’s requirements for disclosure and authorization as well as adverse action.

Milbourne v. JRK Residential America

Plaintiff claims that JRK Residential America did not follow proper disclosure and authorization procedures as set forth by the FCRA. The disclosure form did not consist of solely the disclosure and included extraneous langauge amounting to a liability waiver.

Certified Class Action. Milbourne was the lead plaintiff in this class action lawsuit. Summary Judgment for Plaintiff was GRANTED by the Court.

Employers must ensure they follow strict procedures complying with the FCRA’s requirements for disclosure and authorization as well as adverse action.