Class Action Lawsuit Claims Retailer Violated FCRA for Taking Adverse Action But Not Providing Copy of Background Check Report


Class Action Lawsuit Claims Retailer Violated FCRA for Taking Adverse Action But Not Providing Copy of Background Check Report

A home improvement retailer faces a proposed class action lawsuit for allegedly violating the Fair Credit Reporting Act (FCRA) by taking adverse action against job candidates based on background check reports without first giving them copies of the report, according to a copy of the complaint from

The complaint filed in the U.S. District Court for the Western District of North Carolina on February 3, 2022, claimed that the Defendant retailer’s use of background check reports to screen job candidates violated the FCRA, a federal law that regulates background checks for employment purposes.

The complaint claimed Plaintiff candidate was offered a job by Defendant retailer contingent on passing a background check but he did not pass. Neither Defendant nor its consumer reporting agency (CRA) provided Plaintiff with a copy of his report or a statement of his rights under the FCRA as required.

Providing copies of the background check report and a statement of consumer FCRA rights before taking adverse action “arms the nation’s millions of job candidates with the knowledge and information needed to challenge inaccurate, incomplete, and misleading public-records-based reports,” the complaint read.

“Had Defendant bothered to provide Plaintiff with a copy of the consumer report and given him the chance to explain the contents of his report prior to taking adverse action against him, Defendant would have learned that, contrary to the information in the report…, Plaintiff has no felony convictions.”

However, “Plaintiff was never given an opportunity to explain anything to Defendant prior to his abrupt termination. Defendant’s termination of Plaintiff’s employment caused damages in the form of lost pay, and emotional damages due to stress caused by the loss of a job he should certainly have retained.”

The FCRA allows consumers to dispute or explain inaccurate or derogatory information in background check reports before a hiring decision is made, and the Defendant’s alleged conduct was “egregious and willful” since a previous lawsuit it faced alleged an “identical violation,” the complaint stated.

“So while Defendant should know better about how it performs the simple duties the FCRA imposes upon it in the employment context,” a previous settlement “apparently caused no substantive changes in the way in which Lowe’s uses background checks in the employment context,” the complaint claimed.

The FCRA was enacted by Congress in 1970. Readers of this blog are reminded that allegations made in class action lawsuits are not proof that a business or individual violated any law, rule, or regulation since they are in the pleading stage with no factual adjudications yet.

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    Thomas Ahearn - News Blog Editor and Public Relations Specialist

    Thomas Ahearn is our News Blog Editor and Public Relations Specialist. Our News Blog provides information about the background check industry to employers, HR professionals, recruiters, and consumers. ClearStar's News covers a variety of topics including Ban the Box, credit reports, criminal records, data breaches, drug testing, Equal Employment Opportunity Commission (EEOC), E-Verify, Fair Credit Reporting Act (FCRA), HR technology, identity theft and fraud, jobs reports, lawsuits involving screening, Millennial workforce, privacy issues, social media background checks, and workplace violence.

    At ClearStar, we are committed to your success. An important part of your employment screening program involves compliance with various laws and regulations, which is why we are providing information regarding screening requirements in certain countries, region, etc. While we are happy to provide you with this information, it is your responsibility to comply with applicable laws and to understand how such information pertains to your employment screening program. The foregoing information is not offered as legal advice but is instead offered for informational purposes. ClearStar is not a law firm and does not offer legal advice and this communication does not form an attorney client relationship. The foregoing information is therefore not intended as a substitute for the legal advice of a lawyer knowledgeable of the user’s individual circumstances or to provide legal advice. ClearStar makes no assurances regarding the accuracy, completeness, or utility of the information contained in this publication. Legislative, regulatory and case law developments regularly impact on general research and this area is evolving rapidly. ClearStar expressly disclaim any warranties or responsibility or damages associated with or arising out of the information provided herein.


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