Notice: Trying to get property 'ID' of non-object in /mnt/target05/924087/ on line 1916

Notice: Trying to get property 'post_title' of non-object in /mnt/target05/924087/ on line 1918

Employers Need Strategies for Recruiting, Screening for Workplace Fluidity

Just three months ago, the concept of disruption was an allusion to a profitable market innovation strategy. Today, disruption feels like the current state of things for businesses all over the world.

Everything seemed completely normal when clocks struck midnight, Jan. 1, 2020. Now that the year is half over, nothing is normal, and many employers have discovered their talent pools weren’t prepared for disruption of this magnitude. The surviving workplaces are the fittest, thanks to recruiting efforts that included screening for highly adaptable employees with fluid skills.

No one expects a pandemic with more than 12 million confirmed cases (at press time), but there’s something to be said for expecting the unexpected. Even when COVID-19 becomes a chapter in our history books, how can employers prepare for the next worst-case scenario?

3 Steps to Preparedness for the Next Worst-Case Scenario 

A prepared workplace has employees with skills to meet every potential need. Businesses that survive disruption (the disaster kind) will be the ones that capitalize on available skills. Your business can map out a strategy now starting with these steps:

  1. Do a comprehensive review of the skills and experience currently on tap in your talent pool. Employee titles and job descriptions are only a starting place. Past positions, educational degrees, and certifications could all be solutions amidst an unusual scenario.
  2. Strategize how the skills you discovered in your talent pool could be reconfigured or utilized among different departments to meet needs in an as yet unforeseen disruption. Where is there fluidity within departments? Who is agile enough to work across different departments?
  3. Investigate the potential for sharing talent with partner companies, other employers who share your building, and even beyond. The bagel shop downstairs, your preferred printer around the corner, investment firms, temp agencies, and the cloud computing team next door could all be valuable resources.

Employment Screening for Your Current and Future Needs

Accurate and thorough employment screening is key for businesses that want to be prepared for anything. You want your talent to be exactly who they say they are. Ask ClearStar how our comprehensive education, certification, and employment verifications can ensure that you hire the job applicants who have the qualifications and experience you need right now and in the future.

Employee Screening and 5 More Tips for Returning to a COVID-Free Workplace

Health and safety protocols are more important than ever for businesses exploring options to bring staff people back into the office. Many of us think the first step toward keeping COVID-19 out of the workplace is employee screening, but The Centers for Disease Control suggests a workplace hazard assessment is the real starting point. Supervisory teams need to walk through every aspect of their employees’ workdays before being able to determine what protocols need to be in place before the doors open.


  1. Help Employees Maintain Physical Distance. Operations teams should identify when and where employees will face the most risk of proximity to others (small spaces, group meetings, bathrooms, etc.) and create mitigation plans like new seating arrangements, room closures, or staggered work schedules with the help of management, maintenance, and janitorial staff.
  2. Review of Infrastructure for Risks. Does the HVAC system recycle potentially virus-contaminated air? Every effort should be made to increase the flow of fresh air inside your building. Do bathrooms have working exhaust systems? Where are there water fountains, sinks, and other community watering holes? And do they require a sanitization plan, closure, or other protocol? Review the same for vending and coffee machines, shared office machines, etc.
  3. Identify Issues that Developed During Building Closure. Unless the maintenance and janitorial crews made regular visits during the shutdown, the facility will need to be examined for stagnant water systems, pest problems, mold/mildew growth, and other problems that developed and have to be corrected before reopening.
  4. Plan for Sick Employees. HR should establish an action plan for assisting employees who arrive to work with COVID-19 symptoms, develop them during the day, or have someone in their household who tests positive. A follow-up disinfection protocol should also be in place for these instances.
  5. Establish Visitor and Vendor Policies. A workplace that requires visits by outside contractors, customers, etc. must have additional safety protocols in place for health screening, physical distancing, and post-visit site sanitization needs, too.


Once the work environment is ready for action, the employee screening plan can move into place. If possible, each employee should be tested for COVID-19 and provide a clean bill of health before arriving on the first day back at work. Then, screen every worker for COVID-19 symptoms upon every arrival to the building (even after a break) and consider plans for random screenings during the workday. Temperature checks can be done on-site, but you may want to consider additional, virtual health checks performed by medical professionals.


A healthy and well-run workplace leans on experts in each area of business. From facility teams to administrative teams to executive officers, everyone will need to be included in establishing and maintaining COVID-19 safety. Teams that have been reduced, or redirected to new processes, may benefit from outside help in recruiting, hiring, and security. Start a conversation with ClearStar about how we can support you.

Mobile Employment Drug Screening is Ideal for Hiring During COVID-19

Even before COVID-19, mobile employment drug screening technology was boosting the efficiency of hiring processes by taking drug screenings directly to the job candidates. And once COVID-19 is eradicated, it can continue providing a number of benefits to employers, candidates, and employees, too.


Benefits Beyond COVID-19 Infection Risk Mitigation


In addition to the built-in physical distancing benefit, mobile screening technology offers multiple perks for everyone involved in the testing process. More specifically, a tool like ClearMD by ClearStar means employment drug and clinical screenings both:


  • can be managed by the individual rather than HR,
  • effect fewer errors thanks to paperless ordering processes,
  • comply with privacy regulations by communicating via secure portals,
  • save employers money­–and everyone’s time–by requiring fewer touchpoints.


Currently, mobile employment drug screening by ClearMD is integrated with more than 9,000 Abbott Labs, LabCorp, and Quest Diagnostics testing locations. These labs can provide Apple and Android users with automated appointment reminders on their smartphones and securely integrate data with any background check, HR, or ATS software so that, all along the way, HR receives automatic updates of an individual’s progress through the screening process.


ClearMD Can Make Mobile Employment Drug Screening Work for You


Ask ClearStar how our ClearMD mobile technology and nationwide lab integrations can support your recruiting and HR teams during this especially stressful time and well into your next chapters of hiring and workforce management.

June 2020 Screening Compliance Update

Federal Developments

Three-Month Waiver in Response to the Economic Consequences of the COVID-19 Public Health Emergency
To relieve employers of commercial motor vehicle drivers subject to 49 CFR Part 382 from certain pre-FMCSA grants, a three-month waiver from certain pre-employment testing requirements applicable to employers of drivers subject to 49 CFR part 382. This action responds to the President’s Executive Order No. 13924, Regulatory Relief to Support Economic Recovery, issued on May 19, 2020, related to the economic consequences of the Coronavirus Disease 2019 (COVID-19) public health emergency. The waiver is effective June 5, 2020, and ends on September 30, 2020.

Workplace Antibody Test Can’t Be Required EEOC Says
Federal disability law doesn’t allow employers at this time to require coronavirus antibody testing before employees return to work, according to the Equal Employment Opportunity Commission.

The civil rights agency’s latest guidance falls in line with advice from the Centers for Disease Control and Prevention, which had said the tests shouldn’t be used to “make decisions about returning persons to the workplace.” The presence of antibodies in a test can’t be equated with a worker’s immunity from COVID-19, the CDC guidance said.

The EEOC has, however, allowed employers to test workers for COVID-19 under the Americans with Disabilities Act. If an employer requires a mandatory medical evaluation of an employee, the ADA says it must be “job related and consistent with business necessity.”

The EEOC has said that because an individual suffering from the virus poses a “direct threat” to the health of others in a workplace, COVID-19 tests meet that requirement under the ADA.

“Please note that an antibody test is different from a test to determine if someone has an active case of COVID-19 (i.e., a viral test),” the agency said in its updated guidance, released Wednesday.

The agency said it “could update this discussion in response to changes in CDC’s recommendations.”

EEOC Provides Return-to-Work and COVID-19 Antibody Testing Guidance Under Federal Civil Rights Laws
As the nation continues the gradual reopening of workplaces and the economy, the U.S. Equal Employment Opportunity Commission (EEOC) has updated its guidance to provide information to employers regarding their responsibilities under federal civil rights laws. The EEOC has been updating this guidance on a rolling basis since March. Key takeaways from its most recent updates address:

Medical Screening
While the EEOC has previously expressed its view that temperature checks and screening for the COVID-19 virus are permissible under the Americans with Disabilities Act (ADA), employers must ensure that such tests are administered in a non-discriminatory way, and the results of such tests be maintained as confidential employer medical records segregated from an employee’s regular personnel file. Most recently, on June 17, 2020, the Agency made clear its view that tests for the presence of the coronavirus itself are permissible under the ADA, as the presence of the virus can indicate that the employee is a direct threat to others in the workplace. At the same time, the updated guidance expresses the EEOC’s view that tests for the presence of coronavirus antibodies are not permissible under the ADA as a screening tool to determine whether employees are allowed to return to work. The EEOC noted that its position is in line with the Centers for Disease Control’s position, but that its position may change in the future if the CDC’s position does. Finally, the guidance makes clear that under the ADA, as well as Title VII of the Civil Rights Act of 1964, an employee who requests an alternative means of screening due to a health or medical condition, or for religious reasons, may be entitled to reasonable accommodation, and employers should view a request for a different means of testing as a request for such accommodation (which may or may not be provided, depending on the burden on the employer in providing an alternative method of screening).

Pregnant and Older Workers
The EEOC’s updated guidance reminds employers that under the Age Discrimination in Employment Act (ADEA) and Pregnancy Discrimination Act (PDA), an employer may not exclude older or pregnant workers from the workplace because of their age or pregnancy, despite the fact that these individuals may be at higher risk of serious illness from COVID-19. This is true even if the employer is acting in what it thinks is the employee’s best interests. The EEOC makes equally clear, however, that employers are free to accommodate requests from older or pregnant workers for flexibility with respect to returning to the workplace, so long as it does so in a consistent and non-discriminatory manner. The takeaway, however, is that an employer may not systematically exclude them.

ADA/Employees With Higher-Risk Family Members
The EEOC’s updated guidance also makes clear that an employer is not required to provide reasonable accommodation to an employee without a disability, even where, for example, the employee without a disability requests a reasonable accommodation to avoid exposing a family member who is at higher risk of severe illness from COVID-19 due to an underlying medical condition or disability. Again, however, the Agency notes that employers are free to provide workplace flexibility beyond what the law requires (e.g., choosing to allow an employee to continue to telework to avoid exposing a vulnerable family member), but cautions that an employer that does so should be careful to not do so on a discriminatory basis.

COVID-19 Antibody Testing: Useful Screening Tool or Impermissible Medical Examination?
As the United States still struggles with testing capacity for active COVID-19 infections, employers are increasingly asking “may we require our employees be tested for the presence of COVID-19 antibodies?” This is particularly true following the Equal Employment Opportunity Commission’s position that employers were permitted to test for the presence of active COVID-19 infection, set forth in its What You Should Know About COVID-19 resource (Q&A 6).

Antibody testing is appealing because there is widespread availability on the private market, and employees do not need to satisfy certain screening criteria before receiving a test, unlike tests for active COVID-19 infection. If an employee has the antibodies for COVID-19, that means the employee was presumed to have had COVID-19 at some point in the past. According to the CDC, antibodies develop between 1-3 weeks after infection. A positive antibody test does not indicate the presence of an active infection.

The hope with COVID-19 is that antibodies will confer some immunity for some period of time. In the employment context, the appeal of using antibody testing is that employers and employees can feel safer with an employee who has antibodies being back in the workplace. Perhaps even those with antibodies are placed in a more public-facing role with the notion they cannot contract COVID-19 again. However, this is, after all, the “novel coronavirus” and there are many things scientists simply do not yet know about the disease.

A primary concern about antibody testing is the tests themselves are of varying reliability. Originally, not all tests that are offered on the private market were authorized by the FDA (the FDA has since ordered those tests off of the market). The tests that have been authorized by the FDA were granted emergency use authorization (EUA). EUA status may be given by the FDA Commissioner to allow unapproved products to be used in an emergency to diagnose, treat, or prevent serious or life-threatening diseases or conditions when there are no adequate, approved, and available alternatives. Although the FDA has authorized use of some antibody tests, it has not independently validated any of them.

This leads to the CDC’s recently issued interim guidance on antibody testing, which severely undermines the assumption of immunity: “We currently don’t have enough information yet to say whether someone will definitely be immune and protected from reinfection if they have antibodies to the virus.” The CDC also expressly stated “Serologic test results should not be used to make decisions about returning persons to the workplace.” This is hardly a ringing endorsement for mandating antibody testing.

All of this brings us back to the initial question—“may we require our employees be tested for the presence of COVID-19 antibodies?” Let’s turn back to the EEOC FAQ on testing, which only expressly approves of testing for the active presence of COVID-19 virus and is silent on antibody testing. This portion of the EEOC’s response is illustrative:

Consistent with the ADA standard, employers should ensure that the tests are accurate and reliable. For example, employers may review guidance from the U.S. Food and Drug Administration about what may or may not be considered safe and accurate testing, as well as guidance from CDC or other public health authorities, and check for updates. Employers may wish to consider the incidence of false-positives or false-negatives associated with a particular test. Finally, note that accurate testing only reveals if the virus is currently present; a negative test does not mean the employee will not acquire the virus later.

What does this all mean for employers? Under the Americans with Disabilities Act, all mandatory employee testing must be job-related and consistent with business necessity. The EEOC has concluded that because COVID-19 presents a “direct threat” in the workplace, employers may test for the presence of an active infection. By contrast, antibody tests do not detect active infection and therefore do not aid in preventing the spread of COVID-19 in the workplace. In addition, the reliability of the antibody tests themselves is problematic. Thus, antibody tests do not appear job-related and consistent with business necessity and would likely be viewed as an impermissible medical inquiry—not to mention the potential claims that could arise should employers take employment actions (reassignment, reduction in hours, or loss of overtime, for example) based upon the results of the testing.

As scientists learn more about what the presence of COVID-19 antibodies mean for immunity, and as antibody testing becomes more reliable, it is certainly possible antibody testing may become a permissible medical examination. For now, employers should think twice before mandating antibody testing.

EEOC Says You Don’t Have to Accommodate Employee Concerns About Family Members and COVID-19
The EEOC supplemented its guidance today on the ADA, reasonable accommodations and COVID-19. The new guidance adds several Q&As on accommodation, including whether employers must accommodate employee concerns about returning to work when the employees live with family members who are at risk of more serious illness from COVID-19. The EEOC believes no accommodation is required for such employees. The new guidance also addresses several hot topics, such as whether employers may lawfully exclude pregnant or older employees (aged 65 or older) from the workplace (no), whether employers may treat employees age 65 or older better than employees aged 40 to 64 (yes), how employers should address race-based harassment for employees of Asian descent, the sex discrimination considerations for caregiver policies, and how employers can begin discussing necessary accommodations for employees at higher risk of severe illness before the workplace is scheduled to open. Read the supplemental guidance here.

Overview of Recent Updates for Employers in the Commercial Trucking Industry
The COVID-19 pandemic has highlighted the central role local and long haul trucking companies and drivers play in the overall U.S. economy and specifically our public health infrastructure. Now, as states and businesses around the country gradually reopen and truck deliveries begin to ramp up, employers in the commercial trucking industry should be aware of recent changes to Hours of Service regulations as well as COVID-19-related guidance on keeping employees and the general public healthy and safe. By updating their policies and procedures and enacting responsible safety measures, motor carriers will be in the best position to weather the storm of this pandemic and avoid the risks associated with employment litigation and compliance pitfalls.

The Federal Motor Carrier Safety Administration (“FMCSA”), which falls under the United States Department of Transportation (“DOT”), is responsible for developing and enforcing Hours of Service (“HOS”) regulations for the trucking industry. HOS regulations limit when and how long an individual may drive in order to reduce the possibility of driver fatigue. The existing HOS regulations for property-carrying vehicles under 49 C.F.R. § 395.3 are as follows:

  • Drivers may drive a maximum of 11 hours within a 14-hour window after coming on duty.
  • Drivers can only come on duty after taking 10 consecutive hours of off-duty rest time.
  • If more than 8 consecutive hours have passed since the driver’s last off-duty (or sleeper-berth) period of at least 30 minutes, the driver must take an off-duty break of at least 30 minutes before driving. This does not apply to drivers who qualify for either of the short-haul exceptions in 395.1(e)(1) or (2).
  • Drivers may not drive after 60/70 hours on duty in 7/8 consecutive days.

For HOS regulations to apply, the driver’s property-carrying commercial motor vehicle must (1) be used on public highways in interstate commerce and (2) meet certain gross vehicle weight standards. According to the FMCSA, commercial trucking employers who meet those requirements do not need to comply with state meal and rest period laws because the HOS regulations preempt state law. This is particularly significant for motor carriers who operate in California. While the Ninth Circuit Court of Appeals has yet to weigh in on the FMCSA’s December 2018 Preemptive Determination with respect to California’s meal and rest period requirements under the Labor Code and Industrial Welfare Commission Wage Order 9, thus far district courts in California have upheld the FMCSA’s decision.[i] A ruling from the Ninth Circuit is anticipated later this year.

Given the preemptive effect of the FMCSA’s HOS regulations, modifications to existing regulations are significant because they impact tens of thousands of truck drivers throughout the country—including employee drivers as well as independent owner/operator drivers. As discussed below, in recent months HOS regulations have undergone both temporary and permanent changes, all which will have a significant impact on the transportation business for years to come.

Temporary Changes to Hours of Service Regulations
In response to the ongoing pandemic, the FMCSA issued a National Emergency Declaration for commercial motor vehicles delivering relief during the first few months of the COVID-19 pandemic. The FMCSA issued Emergency Declaration No. 2020-002 on March 13, 2020, and recently extended and expanded its relief through June 14, 2020. Under the emergency declaration, motor carriers and drivers providing “direct assistance in support of relief efforts related to the COVID-19 outbreak” are granted emergency relief from Parts 390 through 399 of the FMCSRs. Consequently, HOS regulations for property-carrying vehicles under 49 C.F.R. § 395.3 have been suspended when motor carriers and drivers are providing “direct assistance in support of relief efforts.” The suspension of HOS regulations permits drivers to operate a commercial vehicle for longer than eleven hours without needing to take the required ten consecutive hours off duty. That being said, drivers who inform carriers that they require immediate rest shall be given at least ten consecutive hours off before the drivers are required to return to service.

Emergency Declaration No. 2020-002 covers transportation to meet immediate needs for:

  • medical supplies and equipment related to the testing, diagnosis and treatment of COVID-19;
  • supplies and equipment necessary for community safety, sanitation, and prevention of community transmission of COVID-19 such as masks, gloves, hand sanitizer, soap and disinfectants;
  • food, paper products and other groceries for emergency restocking of distribution centers or stores;
  • immediate precursor raw materials — such as paper, plastic or alcohol — that are required and to be used for the manufacture of items in categories (1), (2) or (3);
  • fuel;
  • liquefied gases to be used in refrigeration or cooling systems;
  • equipment, supplies and persons necessary to establish and manage temporary housing, quarantine, and isolation facilities related to COVID-19;
  • persons designated by Federal, State or local authorities for medical, isolation, or quarantine purposes; and
  • persons necessary to provide other medical or emergency services, the supply of which may be affected by the COVID-19 response.

Notably, “direct assistance” does not include routine commercial deliveries, including truck loads mixed with a nominal amount of qualifying emergency relief added simply to obtain the benefits of the emergency declaration.

California Governor Gavin Newsom signed a similar order, Executive Order N-31-20, that also permits drivers to exceed the hours of service limits specified in California Vehicle Code section 34501.2 and California Code of Regulations, Title 13, section 1212.5. California’s waivers are in effect for the duration of the FMCSA’s Emergency Declaration 2020-02.

The FMCSA took the position that the most recent extension occurred because the COVID-19 national emergency remains in place. It therefore appears likely that Emergency Declaration 2020-02 will be extended again if the President’s national emergency declaration continues through June.

Permanent Changes to Hours of Service Regulations
In a ruling unrelated to COVID-19, the FMCSA announced on May 14, 2020, that it finalized permanent changes to its HOS regulations. The ruling comes nearly two years after the FMCSA first issued an advanced notice of proposed rulemaking in August 2018, seeking public input on potential revisions to certain HOS provisions. After receiving over 5,000 comments, the FMCSA proposed detailed changes back in August 2019, and received an additional 2,800 comments during the subsequent comment period. The new HOS regulations will become effective 120 days after publication in the Federal Register, likely making them effective in September of 2020.

The new final rule relaxes the 30-minute rest break requirement in two substantial ways. First, the 30-minute period is now referred to as a “non-driving interruption” that “may be satisfied by any non-driving period of 30 minutes, i.e., on-duty, off-duty, or sleeper berth time.” Accordingly, drivers can be expected to remain on-duty and perform nondriving tasks like completing paperwork, planning routes, or refueling their trucks during the required 30-minute period. Second, the 30-minute “break” is now only mandatory if the driver has actually been driving for eight hours straight, not just the period of time the driver is on duty. In other words, drivers who do not drive for eight hours straight are not entitled to a 30-minute rest break under the new rule.

Although the final rule also contained modifications to the short-haul trucker exemption, sleeper-berth exception, and adverse driving conditions exception, the 30-minute rest break changes are certainly the most significant. As noted above, the Ninth Circuit Court of Appeals has not addressed the recent FMCSA’s Preemption Determination. Until the Ninth Circuit provides greater clarity on this important issue, motor carriers with employee drivers in California should consult with counsel before relaxing meal period and rest break policies.

Safety and Health Guidance Related to COVID-19
Thanks to COVID-19, employers throughout the country have become more familiar with the federal Occupational Safety and Health Administration (“Fed/OSHA”) and Fed/OSHA-approved State Plans like California’s Division of Occupational Safety and Health (“Cal/OSHA”) (collectively “OSHA”) that enforce an employer’s responsibility to protect the health and safety of their employees. Much of the guidance issued by OSHA during the ongoing COVID-19 pandemic has originated from guidance from the United States Centers for Disease Control and Prevention (“CDC”). The CDC’s guidance ranges from general industry guidance applicable to all employers to industry-specific guidance that addresses infection hazards specific to workplaces within an industry.

In recent guidance, the Centers for Disease Control and Prevention (“CDC”) identified infection prevention control measures that employers with long-haul drivers (and presumably short-haul drivers) should consider adopting. Note that unless required by the federal Occupational Safety and Health Administration (“OSHA”), a state-approved OSHA plan (e.g. Cal/OSHA), or other state regulations or ordinances, CDC recommendations are not compulsory on employers. The CDC’s guidance identified the following potential sources of COVID-19 exposure for drivers: (1) close contact with truck stop attendants, store workers, dock workers, other truck drivers, or others with COVID-19, and (2) drivers touching their nose, mouth, or eyes after contacting surfaces touched or handled by a person with COVID-19. The CDC also advises commercial trucking employers to make a plan to handle the unique COVID-19 related complications drivers face, including for example, what to do if a driver becomes sick or tests positive for COVID-19 while on the road. The CDC recommends that the plan address where to stop, where and how to seek medical advice and treatment, and plans for freight delivery.

The CDC further recommends that drivers practice social distancing in the following manner:

  • Limit time spent outside of the truck cab during fueling, loading and unloading, and at rest and truck stops.
  • Use paperless, electronic invoicing for fueling, deliveries, and other tasks, when available.
  • Contact facilities in advance to make an appointment for unloading of cargo and be aware that some facilities may not grant access to restrooms, and plan as best as possible.
  • Use radio/phone to talk with dock managers or other drivers, if possible.
  • Pack food, water, and supplies to limit the number of stops.
  • Avoid shaking hands and touching surfaces often touched by others when outside of the cab.
  • Keep the truck well-ventilated.

The CDC also recommends employers establish cleaning and disinfecting procedures for the following frequently touched surfaces on a routine basis:

  • In the truck cab (driver door handle, steering wheel, seat belt and buckle, arm and head rest, seat cover, turn signal, wiper controls, dashboard, air ducts, radio, and temperature controls).
  • In the sleeper berth (light switches, mattress tray, temperature controls, and other flat surfaces).
  • If another individual must have access to the interior of the truck (e.g., mechanics, other drivers, inspectors), the truck should be cleaned and disinfected after the individual accesses the truck.

As for training drivers on proper hand hygiene, the CDC recommends that drivers wash/sanitize their hands at the following times:

  • Before entering and leaving the cab, including deliveries, loading and unloading of cargo, rest breaks, fueling, and other activities;
  • Before eating or preparing food;
  • After putting on, touching, or removing cloth face coverings;
  • After blowing your nose, coughing, or sneezing; and
  • After using the restroom.

The CDC also recommends employers do the following:

  • Provide drivers with all PPE (including vests, safety glasses, hard hats) that they might need while on the road so that the driver does not need to borrow PPE from others.
  • Provide alcohol-based hand sanitizers containing at least 60% alcohol for truck cabs and disposable disinfectant wipes so that surfaces commonly touched can be wiped down.
  • Provide tissues and small trash cans for truck cabs.
  • Institute measures to physically separate and increase distance between drivers, other coworkers, and customers, such as:
    • Develop policies and technology options that allow and encourage contactless deliveries, such as no-signature delivery. These options limit contact, provide space, and avoid the sharing of items like pens and electronic signature pads between drivers and individuals at the delivery location.
    • During driver training situations, use virtual training methods and in-vehicle monitoring systems where possible. Limit ride-alongs and in-person classroom-based training.
  • Take additional precautions to address risks associated with ride-alongs or team driving (two drivers in the cab on a long-haul run) when they cannot be avoided. For example, install a removable barrier between the driver and passenger that does not obstruct the task of driving and/or to separate sleeper berth.
  • Pre-qualify truck stops, rest areas, and hotels to ensure such facilities are open, supplied, and follow recommended COVID-19 safety practices, such as:
    • cleanliness and disinfection (such as routine cleaning, available hand-sanitizing stations, and private showers);
    • proper food handling and food service (such as replacing self-service with full service); and
    • contactless fuel payment.

Employers should also monitor guidance from Fed/OSHA and State Plans where applicable. For example, recent guidance from Cal/OSHA identifies COVID-19 infection control prevention measures that are mandatory for all California employers to include in their written Injury and Illness Prevention Program where generally applicable. In addition, employers should consult any health and safety guidance their state issues in conjunction with phased reopening plans, some of which may be industry-specific, such as California’s reopening guidance that covers delivery services and logistics/warehousing facilities and mentions drivers’ interactions at ports or manufacturing facilities.

OSHA Issues Updated COVID-19 Guidance for Construction Industry Employers
On May 27, 2020, the Occupational Safety and Health Administration (OSHA) updated its guidance for employers performing construction work of all types. The agency’s guidance is not a standard or regulation, so it is not legally binding. Nonetheless, construction industry employers may want to consider OSHA’s recommendations when developing and updating their workplace safety and health plans, for two reasons. First, the guidance indicates which measures OSHA might allege are required by the Occupational Safety and Health Act’s General Duty Clause, just as it has done with heat stress, workplace violence, and other hazards for which it has no specific standard. Second, the document may indicate what employees may expect their employers to do as more people get back to work.

Risk-Level Assessment
OSHA recommends that employers assess hazards, evaluate risks, and implement controls based on the four exposure risk levels OSHA has used for all of its COVID-19-related guidance and recommendations. Notably, OSHA indicates that the “Very High” risk level is “not applicable for most anticipated work tasks” in the industry. The “High” risk level is for tasks requiring workers to enter “an indoor site occupied by people such as other workers, customers, or residents suspected of having or known to have COVID-19,” such as a nursing home or other healthcare facility. The “Medium” risk level is for “tasks that require workers to be within 6 feet of one another” or “customers, visitors, or members of the public.” Finally, the “Lower” risk level covers tasks that “allow employees to remain at least 6 feet apart and involve little contact with the public, visitors, or customers.” So OSHA primarily, but not exclusively, recommends reduced contact and proximity to others. OSHA recommends—but, again, does not require—that employers conduct a job hazard analysis (JHA) focused on the specific risk level of the analyzed tasks.

Indoor Construction Environments With High Risk of Exposure
OSHA’s guidance focuses primarily (but not exclusively) on indoor construction environments in the High risk level. For engineering controls, OSHA recommends using physical barriers, such as closed doors, walls, or even plastic sheeting barriers.

OSHA emphasizes that employers should use engineering controls so that employees need not be required to use N95 respirators and other personal protective equipment (PPE). As an example of engineering controls, OSHA mentions “water delivery or dust collection systems that will further reduce ambient dust when cutting, breaking, jackhammering, or drilling.” OSHA does not, however, make such a recommendation for outside construction environments or even indoor environments not in the High risk level.

For administrative controls, OSHA recommends employers use questions for screening work assignments when “scheduling indoor construction work to assess potential exposures and circumstances” before sending workers inside. OSHA recommends employers first ask if the work is “essential, urgent, or emergency work,” and if so, use a JHA to determine how to best minimize exposure.

If workers must enter home environments or areas where construction is ongoing in occupied buildings, OSHA recommends implementing standard operating procedures and employee training. Those procedures could include requesting any quarantined or isolated nonworkers (i.e., residents) to remain physically separated from workers, asking residents to communicate with workers remotely instead of in person, and asking residents to wear face coverings. OSHA also recommends taking measures to ensure that indoor working areas have adequate air flow.

Training for Construction Workers
OSHA recommends that construction workers be trained on COVID-19-related topics, such as:

  • recognizing the signs and symptoms of the disease;
  • understanding how the disease spreads, and how infected people can be asymptomatic and still spread the disease;
  • the need to follow company policies and procedures;
  • social distancing and hygiene practices;
  • the use of PPE; and
  • the importance of staying home if sick.

The amount of training an employer should do for a particular job site or task will depend on the prior determination of the risk level. OSHA’s guidance indicates that employees in occupied indoor worksites will require broader training.

Cloth Face Coverings in Construction?
OSHA clarified in bold type that “Cloth face coverings are not PPE,” and “[t]hey are not “appropriate substitutes for PPE,” such as N95 respirators or medical face masks. This is important because it relieves employers of any requirement to conduct written worksite assessments and training for face coverings, which would be required of any PPE. The agency recommends face coverings as a public health measure and notes that cloth face coverings protect other people, not the wearer. But OSHA does not require their use on a construction site. As OSHA’s guidance reminds, when a respiratory hazard exists, employers must comply with OSHA’s Respiratory Protection standard (29 C.F.R. Section 1910.134).

Other Safe Work Practices
OSHA’s updated guidance also recommends employers consider a wide range of other safe work practices, such as screening all visitors; adopting staggered work schedules; identifying “choke points where workers are forced to stand together”; “implement[ing] policies to maintain social distancing”; coordinating site deliveries to minimize contact and requiring delivery personnel to remain in their vehicles, if possible; implementing “a rigorous housekeeping program to reduce dust levels”; and minimizing in-person meetings of all types, such as toolbox talks and safety meetings.

Key Takeaways
OSHA’s updated construction guidance provides far greater detail and recommendations than the agency’s initial attempt. Although much of the content is specifically directed toward construction work occurring indoors, construction employers of all types are likely to find the recommendations useful. As with all workplace hazards, assessment, abatement, engineering and physical controls, training, and work practice controls are key safety elements.

Updated CDC Guidance: COVID-19 Employer Information for Office Buildings
Last week, the Centers for Disease Control and Prevention (the “CDC”) issued updated guidance detailing steps employers and office building managers should take prior to reopening. This guidance follows the beginning stages of most states’ business reopening efforts. The guidance focuses on four major topics: Evaluation of the Workspace, Assessment of Risk, Implementation of Workplace Controls, and Education. In short, the guidance encourages employers to evaluate and address potential COVID-19 related hazards and provides steps businesses can take to minimize exposure or transmission once their doors are opened. This new guidance echoes and supplements the CDC’s previous interim guidance as well as OSHA guidance, particularly with respect to the implementation of hazard controls. We summarize significant portions of the CDC’s updated guidance below:

Key Information for Office-Based Employers

Creation and Implementation of COVID-19 Workplace Health and Safety Plan
All employers are encouraged to develop a COVID-19 workplace health and safety plan in order to protect both employees and visitors (i.e. clients or customers). The CDC encourages employers to implement and update as necessary a plan specific to its workplace, which identifies all areas and job tasks with potential exposures to COVID-19 and includes control measures to eliminate or reduce such exposures. This plan should be in accordance with applicable state and local orders, OSHA guidance, and other applicable agency guidance. The CDC refers employers to its CDC Interim Guidance for Businesses and Employers for guidelines and recommendations on creating a plan.

Evaluation of Offices and Buildings
Prior to reopening offices to employees, the CDC recommends employers (and building management) evaluate whether the building is “ready” for reentry and occupancy. This involves checking heating, air flow or ventilation, and air conditioning systems; ensuring the system(s) are working properly; and increasing circulation of outdoor air where possible. In addition, employers should verify any other systems (e.g., mechanical and life safety systems) are operational, and no other hazards associated with unoccupied buildings exist (e.g., rodents, mold, or stagnant water).

Assessment of Risk
Employers should conduct a “thorough hazard assessment” of the office to identify where and how employees could potentially be exposed to COVID-19 in the office or office building (e.g., common areas or break rooms). Depending on the assessed risk of exposure or transmission, the employer should consider implementing various safety measures and workplace controls.

Implementing Workplace Controls
In line with OSHA’s Guidance (and as discussed in parts two and three of our COVID-19 Roadmap Series), the CDC suggests developing hazard controls using the “hierarchy of controls,” including: engineering controls to isolate workers from hazards (e.g., taking steps to reconfigure workspaces and physically separate employees to allow for social distancing or improving ventilation)[2] and administrative controls to modify or change how individuals work (e.g., encouraging employees who are sick to stay home; screening employees prior to entry into the workplace; requiring facial coverings; providing incentives for employees who regularly use public transportation).

Education of Employees and Supervisors
The CDC’s updated guidance continually stresses the importance of communication with employees and other workplace constituents regarding actions the employer is taking to protect its employees and reduce the risk of exposure or transmission. These communications (including posters and notices) should be frequent and easy to understand. Topics employer should cover include: symptoms of COVID-19, staying home when sick, social distancing, hygiene protocols, masks and personal protective equipment (“PPE”), and best practices for minimizing transmission in the workplace (as well as outside of work).

Parting Thoughts
At a minimum, the CDC’s updated guidance reiterates the importance of employer preparedness, hygiene protocols, and communications with employees in order to keep them apprised of the steps being taken to protect them. While the CDC’s guidance is not binding, it is a valuable resource for employers looking to protect their workforce as they return to the office and those seeking to update or improve their COVID-19 workplace plans. Employers should also be aware that multiple states’ reopening requirements (for example, those recently issued in CaliforniaMassachusetts, and New York) either require or recommend that businesses comply with the CDC’s guidance.

OSHA Updates Its COVID-19 Recordkeeping Guidance, Giving Employers Helpful Guardrails
COVID-19 has reached virtually the entire country, and both employers and employees in a broad range of industries have experienced outbreaks. At the same time, the government and private sector continue to take steps to slow the virus’s spread and protect employees while adapting to the new business environment. In recognition of the unique challenges posed by COVID-19, the Occupational Safety and Health Administration (OSHA) is applying updated guidance in an effort to provide additional clarity to employers and workers.

On May 26, 2020, OSHA issued updated guidance concerning employers’ recordkeeping responsibilities with respect to employee COVID-19 cases. Under OSHA’s general recordkeeping requirements, employers would be responsible for recording cases of COVID-19 if: (1) the case is confirmed as a case of COVID-19; (2) exposure in the work environment caused or contributed to the illness; and (3) the infection results in death or significant injury, time off work, restricted work or transfer to another job, medical treatment beyond first aid, or loss of consciousness. However, in recognition that it remains difficult to determine whether a COVID-19 illness is work-related, OSHA is exercising its enforcement discretion to articulate and enforce specific recordkeeping requirements for such illnesses.

In determining whether an employer has complied with its obligations to make a reasonable determination of work-relatedness, OSHA will consider the reasonableness of the employer’s investigation, the evidence available to the employer, and the evidence that COVID-19 was contracted at work. Per the May 26 enforcement memorandum, it is sufficient for an employer, once it learns of an employee’s COVID-19 illness, to: “1) ask how the employee believes he/she contracted the illness; 2) while respecting employee privacy, discuss the employee’s work and out-of-work activities that may have led to the illness; and 3) review the employee’s work environment for” potential exposure. The evidence considered should be the information reasonably available to the employer — if the employer later learns more information, that information should be factored into the determination as well. There is no formula to determine work-relatedness, but OSHA has specifically identified certain evidence with respect to determining whether a case is/is not work-related:

  • OSHA advises that “COVID-19 illnesses are likely work-related when several cases develop among workers who work closely together and there is no alternative explanation.”
  • OSHA also notes that “an employee’s COVID-19 illness is likely work-related if it is contracted shortly after lengthy, close exposure to a particular customer or coworker (or other person) who has a confirmed case of COVID-19 and there is no alternative explanation.”
  • Further, OSHA writes that an employee’s COVID-19 illness is likely work-related if his/her “job duties include having frequent, close exposure to the general public in [an area] with ongoing community transmission and there is no alternative explanation.”
  • OSHA indicates that an employee’s COVID-19 illness is likely not work-related if she/he “is the only worker to contract COVID-19 in [the employee’s job] vicinity and [the] job duties do not include having frequent contact with the general public, regardless of the rate of community spread.”
  • In addition, OSHA states that an employee’s COVID-19 illness is likely not work-related if the employee, “outside the workplace, closely and frequently associates with someone (e.g., a family member, significant other, or close friend) who (1) has COVID-19; (2) is not a coworker, and (3) exposes the employee during the period in which the individual is likely infectious.”

OSHA has noted that its inspectors “should give due weight to any evidence of causation, pertaining to the employee illness, at issue provided by medical providers, public health authorities, or the employee” herself/himself.

If, after a reasonable and good-faith inquiry, the employer cannot determine whether it is more likely than not that exposure in the workplace played a “causal role” with respect to a particular case of COVID-19, then the employer need not record that illness. For cases that are deemed to be work-related, employers should take note, however, that because COVID-19 is an illness, if an employee voluntarily requests that his or her name not be recorded, the employer must comply.

OSHA’s guidance is intended to be time-limited to the current COVID-19 public health crisis, and employers should continue frequently checking OSHA’s webpage for updates. Finally, OSHA notes that “it is important as a matter of worker health and safety, as well as public health, for an employer to examine COVID-19 cases among workers and respond appropriately to protect workers, regardless of whether a case is ultimately determined to be work-related.”

COVID-19: OSHA Issues Updated Guidance on Wearing Masks in the Workplace
The U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) has published a series of frequently asked questions and answers regarding the use of masks in the workplace.

The new guidance provides answers to the frequently asked questions of:

1. What are the differences between cloth face coverings, surgical masks and respirators?

  • Cloth face coverings:
    • May be commercially produced or improvised (i.e., homemade) garments, scarves, bandanas, or items made from t-shirts or other fabrics.
    • Are worn in public over the nose and mouth to contain the wearer’s potentially infectious respiratory droplets produced when an infected person coughs, sneezes, or talks and to limit the spread of SARS-CoV-2, the virus that causes Coronavirus Disease 2019 (COVID-19), to others.
    • Are not considered personal protective equipment (PPE).
    • Will not protect the wearer against airborne transmissible infectious agents due to loose fit and lack of seal or inadequate filtration.
    • Are not appropriate substitutes for PPE such as respirators (e.g., N95 respirators) or medical face masks (e.g., surgical masks) in workplaces where respirators or face masks are recommended or required to protect the wearer.
    • May be used by almost any worker, although those who have trouble breathing or are otherwise unable to put on or remove a mask without assistance should not wear one.
    • May be disposable or reusable after proper washing.
  • Surgical masks:
    • Are typically cleared by the U.S. Food and Drug Administration as medical devices (though not all devices that look like surgical masks are actually medical-grade, cleared devices).
    • Are used to protect workers against splashes and sprays (i.e., droplets) containing potentially infectious materials. In this capacity, surgical masks are considered PPE. Under OSHA’s PPE standard (29 CFR 1910.132), employers must provide any necessary PPE at no-cost to workers.1
    • May also be worn to contain the wearer’s respiratory droplets (e.g., healthcare workers, such as surgeons, wear them to avoid contaminating surgical sites, and dentists and dental hygienists wear them to protect patients).
    • Should be placed on sick individuals to prevent the transmission of respiratory infections that spread by large droplets.
    • Will not protect the wearer against airborne transmissible infectious agents due to loose fit and lack of seal or inadequate filtration.
    • May be used by almost anyone.
    • Should be properly disposed of after use.
  • Respirators (e.g., filtering facepieces):
    • Are used to prevent workers from inhaling small particles, including airborne transmissible or aerosolized infectious agents.
    • Must be provided and used in accordance with OSHA’s Respiratory Protection standard (29 CFR 1910.134).

2. Are employers required to provide cloth face masks to workers? NO.Cloth face coverings are not considered personal protective equipment (PPE) and are not intended to be used when workers need PPE for protection against exposure to occupational hazards. As such, OSHA’s PPE standards do not require employers to provide them.

3. Should workers wear cloth face masks while at work? YES

4. If workers wear cloth face masks at work, should employers still look to ensure some level of social distancing? YES

5. How am I supposed to keep my cloth mask clean? See attached suggested procedures from the CDC—

6. Are surgical masks or cloth face masks acceptable respiratory protection in the construction industrywhen respirators would be need but are not available? NO. Employers should not be using surgical masks or cloth face coverings when respirators are needed.

In general, employers should always rely on a hierarchy of controls that first includes efforts to eliminate or substitute out workplace hazards and then uses engineering controls (e.g., ventilation, wet methods), administrative controls (e.g., written procedures, modification of task duration), and safe work practices to prevent worker exposures to respiratory hazards, before relying on personal protective equipment, such as respirators. When respirators are needed, OSHA’s guidance describes enforcement discretion around use of respirators, including in situations in which it may be necessary to extend the use of or reuse certain respiratorsuse respirators beyond their manufacturer’s recommended shelf life, and/or use respirators certified under the standards of other countries or jurisdictions.

For more information on this topic and the actual FAQs please go to Note that the OSHA guidance is NOT a standard or a regulation, rather it is advisory in nature and is intended to provide direction from OSHA.

CFPB Provides Additional Guidance on CARES Act Credit Reporting
On June 16, 2020, the Bureau of Consumer Financial Protection (CFPB) released a Compliance Aid in the Form of Ten FAQs (FAQs) on consumer reporting related to the CARES Act and the COVID-19 pandemic. The FAQs follow the Fair Credit Reporting Act (FCRA) Policy Statement issued by the CFPB on April 1 (the Statement). While the FAQs generally are consistent with the Statement, they also suggest a more aggressive enforcement posture. For instance, in the Statement, the CFPB indicated that it did not intend to cite in an examination or bring an enforcement action against a consumer reporting agency (CRA) or furnisher which makes good-faith efforts to investigate disputes as quickly as possible, even if they take longer than the statutory time frame. While not in direct contradiction to the Statement, the FAQs caution that the CFPB will not be providing CRAs or furnishers with unlimited time before taking action. Seven of the ten FAQs focus on accommodations made to consumers by creditors and how they affect reporting. For obligations or accounts that are current before the accommodation, furnishers must continue to report them as current. If an obligation or account is delinquent prior to the accommodation, furnishers must not advance the delinquent status. If a delinquency is brought current by the accommodation or by payments from the borrower, then the furnisher must report the credit obligation or account as current.

The FAQs also caution furnishers to ensure that all tradeline information is updated to accurately reflect that a consumer’s account is current consistent with the CARES Act. The FAQs also encourage furnishers to understand the data fields used by the CRAs to whom they report and reiterate that using a special comment code for disasters is not an adequate substitute for complying with these accommodation reporting requirements.

Finally, the FAQs state that forbearances should not be reported on accounts for which consumers neither have requested a forbearance nor are delinquent, and that the consumer reporting protections associated with accommodations continue to apply even after the accommodation ends. Unless a consumer fails to meet some payment requirements during the accommodation, a furnisher cannot report an account that was current prior to the accommodation as delinquent, nor can it advance the delinquency of an account for the time period during which there was an accommodation.

Why It Matters
The effects of COVID-19 on consumer credit are unfolding on a daily basis. The CFPB continues to protect consumers who are taking advantage of government-sponsored programs, and so are reminding CRAs and furnishers of their roles and responsibilities in responding to the pandemic. CRAs and furnishers should keep in mind that Compliance Aids are intended to provide practical advice and suggestions but are not binding like regulations and official interpretations.


State Developments

Rhode Island Court Upholds “Reasonable Grounds” Drug Testing Even Where There Is Another Possible Explanation for Employee’s Behaviors
The Rhode Island Supreme Court affirmed the dismissal of a lawsuit against an employer who terminated an employee for refusing to submit to a reasonable suspicion drug test, even though the employee’s odd behaviors could have been attributable to pain or other things. Colpitts v. W.B. Mason Co., Inc., No. 2018-337-Appeal (R.I. May 29, 2020).

The plaintiff, Michael Colpitts, claimed that his former employer required him to take a drug test, allegedly without “reasonable grounds” as required by the Rhode Island drug testing law, R.I. Gen. Laws § 28-6.5-1(a)(1). That law permits testing when the “employer has reasonable grounds to believe, based on specific aspects of the employee’s job performance and specific contemporaneous documented observations, concerning the employee’s appearance, behavior or speech that the employee may be under the influence of a controlled substance, which may be impairing his or her ability to perform his or her job.”

Colpitts was employed as a supply delivery driver for W.B. Mason. He began using medical marijuana for pain as well as post-traumatic stress disorder in 2017, but he testified that he never used marijuana while working and never was impaired at work. He also did not disclose to his employer in 2017 that he had begun using medical marijuana. On March 5, 2018, Colpitts alleged that he injured his arm and back while effecting a delivery as part of his job. When he returned to the worksite and reported his injury, he was questioned by his supervisor and the branch manager. They determined that he might be impaired due to their observations that Colpitts: was stuttering and swearing excessively, was “jumping all over the place,” was confused and had difficulty describing his injuries, did not speak in complete sentences, was staggering and bending over, and stating “I’m f***ed up,” among other things. After his supervisor and branch manager advised Colpitts that he would have to go for drug testing, he insisted that he was “fine” and “got very agitated.” On the way to the collection facility, Colpitts disclosed that he used medical marijuana and that he would probably test positive for marijuana. Once he arrived at the collection facility, Colpitts refused to be drug tested but agreed to an alcohol test. The alcohol test was negative. His employment was terminated because he violated Company policy by refusing the drug test.

After a trial, the court ruled in favor of the employer, finding the employer’s witnesses to be credible and further finding that Colpitts’ “incoherent recitation,” “volatile behavior,” and “the use of profanity” was sufficient to support “reasonable grounds” for drug testing under Rhode Island law.

On appeal, Colpitts argued that there was no evidence that he was under the influence of drugs, and that his behaviors were due to the pain that resulted from his injuries. The Supreme Court held that the trial justice did not abuse her discretion in ruling in favor of the employer. Moreover, the Supreme Court did not agree with Colpitts’ argument that because his behavior “could” have been pain-related, there was no basis for drug testing. Even if his odd behavior had been due to pain, rather than drugs, the employer still had reasonable grounds to believe that Colpitts may have been under the influence of drugs. The Rhode Island drug testing statute does not require an employer to be certain that an employee is under the influence of drugs or alcohol.

Ban the Box Legislation to Take Effect in the City of St. Louis in 2021
Beginning January 1, 2021, employers with ten or more employees, located within the City of St. Louis will be prohibited from inquiring about an applicant’s criminal history on the employment application. Once the law takes effect, employers may not base a hiring or promotional decision on the criminal history, or sentence, of an applicant unless(1) the history is found to be reasonably related to, or bearing upon, the duties and responsibilities of the position; and (2) the employer can demonstrate that the decision is based on all available information.

Employers will be prohibited from inquiring about an applicant’s criminal history until such time as the applicant is otherwise determined to be qualified and has been interviewed for the position. The prohibition extends to employers seeking publicly available information about criminal history during the initial job application stage. Employers remain able to inquire about an applicant’s criminal history if all applicants in the final stage of selection will be similarly asked.

The prohibition further extends to employment advertisements containing exclusionary language based on criminal history. These prohibitions do not include employers hiring for positions where federal or state laws would otherwise exclude individuals with certain criminal histories. In such circumstances, employers can still publish these requirements and restrictions in advertisements and seek to determine an applicant’s compliance with these regulations during the initial application process.

The City of St. Louis joins 35 states, and over 150 cities and counties nationwide that have adopted “ban the box” legislation. This provides a marked change for local employers going forward once the ordinance takes effect. This will provide opportunity for employers in the City of St. Louis to evaluate their hiring procedures in order to determine compliance with the new requirements. Employers will also need to address policies concerning when criminal history inquiries are made of applicants, revise standard applicant paperwork required, and note that the requirements apply to decisions regarding promotions as well as new hires.

COVID-19 Update: New York State and CDC Guidance for Employers Reopening Offices
Under the NY Forward Reopening Plan, New York State has now issued guidance for reopening Phase Two industries, consisting of (i) office-based businesses; (ii) real estate; (iii) limited retail; (iv) vehicle sales, leases and rentals; (v) retail rental, repair and cleaning; (vi) commercial building management; and (vii) hair salons and barbershops. All essential and non-essential businesses operating in office settings must affirm and adhere to the State’s Interim Guidance for Office-Based Work During the COVID-19 Public Health Emergency (the “Guidance for Office-Based Work” or “Guidance”). The Guidance applies to business activities “where the core function takes place within an office setting” and is relevant to businesses in the following sectors: professional services, nonprofit, technology, administrative support, and higher education administration (excluding full campus reopening). It may also apply to a business that operates parts of its business functions under different guidance, such as a front office for a construction company.

In addition, the Centers for Disease Control and Prevention (the “CDC”) has issued employer guidelines specifically for office buildings. This memorandum serves as a follow-on to the COVID-19 Update: New York State Guidance on Reopening Businesses (“May 19 Memorandum”) and summarizes guidance relevant to employers operating offices under the NY Forward Reopening Plan and recent CDC guidance.

I. Key Takeaways

  • The owner/operator of the business with office-based functions is responsible for meeting the standards under the Guidance for Office-Based Work. The building owner is primarily responsible for meeting standards with respect to any unleased or common areas, and the tenant is primarily responsible for their leased space, absent an alternate agreement.
  • The Guidance for Office-Based Work sets forth detailed requirements with respect to: physical distancing; gatherings in enclosed spaces; workplace activity; movement and commerce; protective equipment; hygiene, cleaning and disinfection; phased reopening; communications plans; screening and testing; and tracing and tracking.
  • Under the CDC guidelines for office employers, businesses should create and implement a COVID-19 workplace health and safety plan and implement various measures, including engineering and administrative controls, to reduce the risk of potential COVID-19 transmission.

II. Reopening Phase Two Industries

As we discussed in our May 19 Memorandum, the NY Forward Reopening Plan permits businesses in each of New York State’s 10 regions to reopen in phases, with at least two weeks between each phase,[5] once each region becomes eligible for reopening by satisfying public health and safety metrics.[6] As of the date of this Memorandum, all regions of the State, except New York City, are now in Phase One or Phase Two of reopening.[7] New York City is expected to enter Phase One on June 8.[8]

Every business is required to develop a written COVID-19 Reopening Safety Plan. Businesses may satisfy this requirement either by using the Safety Plan template or drafting their own plans. Each business must retain its plan on the premises and make it available to the New York Department of Health (the “DOH”) in the event of an inspection. All Phase Two businesses are required to conspicuously post their completed Safety Plan on site.

III. Guidance for Office-Based Work

Standards for Responsible Office-Based Work Activities in New York State

In order to operate office-based activities in New York State, all businesses must adhere to the minimum standards outlined in the Guidance for Office-Based Work. The owner/operator of the business with office-based functions, or their designee (in either case, “the Responsible Parties”), is responsible for meeting the standards. The building owner, or their designee, is primarily responsible for meeting the standards with respect to any unleased or common areas, whereas the tenant, if not the owner, is primarily responsible for meeting the standards with respect to their leased space(s), unless the tenant and building owner reach an alternate agreement. Responsible Parties should coordinate with building management, where applicable.

All businesses must read and affirm the Guidance for Office-Based Work through the NY Forward Reopening Plan website. The Guidance is summarized below:

  • Ensure physical distancing by limiting the number of occupants to 50% of maximum occupancy at any given time; ensuring that a distance of at least six feet is maintained among individuals; limiting the use of shared workstations; increasing ventilation with outdoor air; taking measures to prevent congregation in elevator waiting areas and limiting density in elevators; reducing bi-directional foot traffic; and posting signs throughout the office consistent with DOH signage. Prohibit shared food and beverages (e.g., buffet style meals) and reserve adequate space for employees to observe social distancing while eating meals.
  • Limit in-person gatherings to the extent possible by holding meetings in open, well-ventilated spaces; closing non-essential amenities and communal areas; staggering employee schedules for gatherings like breaks, meals and shift starts/stops; allowing only limited document retrieval from offices by employees who do not need to be in the office; and closing non-essential common areas. Establish designated areas for pickups and deliveries.
  • Create and encourage work-from-home policies and consider developing return-to-office tiers based on factors such as function, safe transportation and ability to work remotely. Consider phasing-in reopening activities. Limit all non-essential travel.
  • Provide acceptable face coverings to employees at no cost to the employee and maintain an adequate supply of personal protective equipment (“PPE”) replacements. Allow employees to use their own acceptable face coverings and train employees on how to adequately put on, take off, clean (as applicable) and discard PPE. Advise employees and visitors to wear face coverings in common areas and implement measures to limit the sharing of objects.
  • Adhere to hygiene, cleaning and disinfection requirements from the CDC[9] and the DOH[10] and maintain cleaning logs. Provide and maintain hand hygiene stations and conduct regular cleaning and disinfection and more frequent cleaning and disinfection for high-risk areas. Comply with the CDC cleaning and disinfection guidelines[11] if an individual is suspected or confirmed to have COVID-19 at the workplace.
  • Develop a communications plan for employees, visitors and customers. Work with building management to help facilitate building-wide communications. Post signage to remind personnel and customers to adhere to health and safety protocols. Provide building management with a list of essential visitors expected to enter the building.
  • Implement mandatory daily health screening of employees and, where practicable, visitors (except for delivery personnel) and coordinate with building managers to facilitate screening. Ensure that any personnel performing screening activities are appropriately protected, properly trained and using PPE.
  • Require employees to immediately disclose if and when their responses to a health questionnaire change, such as if they begin to experience symptoms of COVID-19, review all employee and visitor screening responses on a daily basis, and maintain a record of such review.
  • An employee who screens positive for COVID-19 symptoms should not be allowed to enter the office and should be sent home with instructions and information. Responsible Parties must immediately notify the local health department about any positive case of COVID-19.
  • An employee who has had close contact with a person suspected or confirmed to have COVID-19 may not be allowed to enter the office without following protocols outlined in the Guidance for Office-Based Work.
  • Designate a site safety monitor. Maintain a log of every person, including employees and visitors, who may have close contact with other individuals at the worksite or area (excluding deliveries performed with appropriate PPE or through contactless means) and cooperate with the local health department’s contract tracing efforts. Designate a central point of contact responsible for receiving and attesting to having reviewed all employee questionnaires, who is also identified on the screening questionnaire as the party for employees and visitors to inform if they later are experiencing COVID-19-related symptoms.
  • Immediately notify the local health department and DOH of any positive cases of COVID-19. Notify the local health department of all individuals who entered the site 48 hours prior to an employee or visitor experiencing COVID-19 symptoms or testing positive. And notify building management as to where a symptomatic employee has been throughout the building and if such employee tests positive for COVID-19.

IV. CDC Guidance for Office Buildings

The CDC has also issued guidance for employers in office settings, which is summarized below:

  • Create a COVID-19 workplace health and safety plan to protect workers and clients.
  • Before resuming business operations, check the building in which the business is located to confirm that it is ready for occupancy. Ensure that the ventilation systems operate properly, increase circulation of outdoor air and evaluate the building’s mechanical and life safety systems.
  • Identify where and how workers might be exposed to COVID-19 at work by conducting a thorough hazard assessment of the workplace. Develop a communications plan that includes all employees and contractors, if any.
  • Implement a combination of workplace controls, including engineering controls and administrative controls. Engineering controls include methods that isolate workers from a potential risk of COVID-19 infection, such as modifying workstations to maintain social distancing, improving ventilation and utilizing devices such as ultraviolet germicidal irradiation (UVGI). Employers can implement administrative controls by actively encouraging employees to stay home when they or a family member are sick, conducting daily health checks, reducing the density of employees, cleaning and disinfecting high-touch services, establishing policies and practices for social distancing and personal hygiene, providing support for employees who commute to work using public transportation or ride sharing and encouraging the use of face coverings.
  • Educate employees and supervisors about the following topics: (i) signs and symptoms of infection; (ii) staying home when ill; (iii) social distancing; (iv) personal protective equipment; (v) hand hygiene practices; and (vi) identifying and minimizing potential routes of transmission at work, at home and in the community. Provide information and training on what actions employees should take when they are not feeling well (e.g., workplace leave policies, local and state health department information).

The New York State website on the NY Forward Reopening Plan can be found here:
The New York State guidelines for Phase Two Industries can be found here:
The New York State Guide on the NY Forward Reopening Plan can be found here:
The Safety Plan template can be found here:
New York State’s FAQ on how the NY Forward Reopening Plan may impact a business can be found here:
The CDC Guidance can be found here:
The Business Reopening Lookup Tool can be found here:


Court Cases

ADA Permits Employers to Require Medical Examinations for Problematic Behavior
Two federal appellate courts this month affirmed the right of employers under the Americans with Disabilities Act to require a medical examination to assess an employee’s fitness for duty based upon troubling conduct.

In Johnson v. Old Dominion University, the U.S. Court of Appeals for the 4th Circuit found that the employer had a basis for requiring the employee to undergo a fitness for duty examination based on his increasing inability to communicate and his “adversarial and erratic behavior,” as demonstrated by the excessive number of meritless grievances and document requests that he filed, and his interactions with his manager and co-workers that caused them to fear that he would harm them. Because he refused to undergo the examination on four separate occasions, he was disciplined and then terminated from employment.

In Lopez-Lopez v. The Robinson School, the U.S. Court of Appeals for the 1st Circuit also upheld the employer’s requirement that the employee undergo a medical examination and obtain treatment following a meeting to discuss the teacher’s inappropriate classroom behavior, during which she had a breakdown that resulted in her crying on the floor and threatening suicide.

In both cases, the courts found that the examinations met the standard under the ADA of being job-related and consistent with business necessity, as there was a reasonable basis—Johnson’s impaired communications skills and Lopez’s breakdown and suicidal statements—to believe that the individuals in each situation were unable to perform their essential job functions. As the 1st Circuit stated, “requiring medical examinations may be justified based on business necessity where there is a basis to believe that the employee’s ability to perform her job may be impaired or the employee presents a troubling behavior that would impact the work environment.”

To Tell or Not to Tell: OSHA Changes Course on Reporting of COVID-19 Cases by Employers
Do you have to report an employee’s positive COVID-19 case to OSHA and will OSHA investigate it? On the reporting front, OSHA’s initial guidance said positive cases were reportable only in specific industries, like healthcare, emergency response organizations, and correctional institutions. However, since outbreaks have been reported in additional specific industries, OSHA is now requiring ALL employers to report COVID-19 cases among their employees if a reasonable investigation shows that the case is work related and meets other specified criteria. Under the Revised Enforcement Guidance for Recording COVID-19 Cases, which went into effect on May 26, all employers must make a little deeper inquiry into how an employee contracted the disease and perhaps, report it to OSHA.

OSHA also issued an Updated Interim Enforcement Response Plan for Coronavirus Disease, also effective May 26, which considers the infection rate of certain geographic areas and addresses how the administration intends to handle COVID-19 related complaints, referrals and reports.

Updated Enforcement Plan
As we have said before, geography matters. Under the updated plan, OSHA’s enforcement response measures will differ based on whether “community spread of COVID-19 has significantly decreased” or whether a given geographic area continues to experience “sustained elevated community transmission or a resurgence” of COVID-19 transmission.

In areas where the spread of the virus has decreased, OSHA will resume its inspection planning policy set forth in Chapter 2 of the OSHA Field Operations Manual, CPL 02-00-164, with the exception that OSHA will continue to prioritize COVID-19 cases, utilize non-formal phone and fax investigations or rapid response investigations as needed to efficiently use its resources, and each OSHA area director will ensure that compliance safety and health officers use appropriate precautions and PPE during inspections.

In areas with continued high levels of virus transmission, OSHA will prioritize COVID-19 fatalities and “imminent danger exposures.” When resources are insufficient for onsite inspections, inspections will commence remotely with the expectation that an onsite inspection will follow at a later date. If resources are so limited that neither onsite nor remote inspections are possible, OSHA will conduct its investigations using a rapid response investigation “to identify hazards, provide abatement assistance, and confirm abatement.” In communities with a high prevalence of COVID-19 transmission, special attention to onsite inspections will be given to high-exposure risk work environments such as healthcare facilities, biomedical laboratories, funeral homes and crematoriums, and medical transport companies.

Revised Recordkeeping Enforcement Guidance
Because “outbreaks among workers in industries other than healthcare, emergency response, or correctional institutions have been identified,” OSHA expects employers to take action to determine whether workers’ illnesses are work related. Under OSHA’s recordkeeping requirements, a COVID-19 case is recordable if it:

(1) is confirmed to be COVID-19 as defined by the CDC;
(2) is work related under 29 CFR § 1904.5; and
(3) involves one or more of the general recording criteria set forth in 29 CFR § 1904.7.

The updated guidance continues to recognize the difficulty in determining whether a COVID-19 case is work related and grants enforcement discretion to compliance safety and health officers to assess employers’ efforts in making work-related determinations. Specifically, OSHA officers are instructed to assess the reasonableness of the employer’s investigation into work-relatedness, the evidence available to the employer, and the evidence that a COVID-19 illness was contracted at work.

Employers are not expected to undertake extensive medical inquiries into an employee’s case. The guidance indicates that an employer can satisfy the requirement to conduct a reasonable investigation by:

  • asking the employee how he or she believes the illness was contracted,
  • discussing the employee’s work and out-of-work activities that may have led to the illness, and
  • reviewing the employee’s work environment for potential circumstances of exposure.

If after conducting a reasonable, good faith investigation and weighing all reasonably available evidence “the employer cannot determine whether it is more likely than not that exposure in the workplace played a causal role”, then the employer is not required to record the COVID-19 illness. However, in all cases, OSHA cautions that employers should examine COVID-19 cases among workers and respond appropriately to safeguard the health and safety of employees.


International Developments

Mauritius: Coronavirus (COVID-19) and Data Protection
On 17 April 2020, the Mauritius Data Protection Office (the “DPO”) published a guide on data protection in the context of the Coronavirus (COVID-19) outbreak. The DPO, as the enforcing authority under the Data Protection Act (the “Act”), has reiterated that all organizations involved in the processing of data should continue to comply with all their obligations under the Act.

Data Processing in the Context of COVID-19
The Guide reminds data controllers that consent is not the sole basis for processing data. While the Act allows a data controller to process personal data when necessary, in respect of special categories of data (including health data), further specific conditions will apply. For instance, the DPO acknowledges that supermarkets are under a legal obligation to take the temperature of their customers, and it could be argued that this is required to protect the vital interests of data subjects, other people within the supermarket, and to allow the health authorities to perform their duties. As far as employers are concerned, it should be pointed out that employers have a statutory duty under the Occupational Health and Safety Act (“OSHA”) to ensure the safety, health and welfare of all employees at work, and the obligation under OSHA arises in all circumstances, irrespective of COVID-19.

Under the Guide, the DPO notes that employers may process the health data of their employees on the basis of their obligations under OSHA. In practice, this means employers must prepare and implement protocols or standard operational practices as soon as the confinement is lifted. However, in doing so, employers must always balance their legitimate interest in exercising their rights to collect health data of employees, and those of other data subjects as part of their obligations to implement preventive measures under the OSHA or as imposed by health authorities, against the rights and freedom of the data subjects. It would therefore be advisable that employers refrain from generalizing the practice of processing health data through individual questionnaires or requests to search for potential symptoms of an employee or his/her next of kin, or to collect medical report from employees or agents.

Employers should further bear in mind the following:

  • they may inform their employees if one of their colleagues has been contaminated. However, the name of the specific employee should not be disclosed. Health data can be shared with health authorities in case of contamination;
  • personal data collected for combatting the COVID-19 must not be used or disclosed for other unrelated purposes;
  • personal data collected for the purposes of combatting COVID-19 must be permanently destroyed when the purpose of collection is fulfilled, or when there is no evidence suggesting that any employees have contracted the virus, or have close contacts that have been infected after a reasonable period of time; and
  • employers must demonstrate that adequate security and organizational safeguards have been put in place to protect the sensitive data against unauthorized or accidental access, processing, erasure, loss or use.

The Guide also provides that developers of apps and the use of artificial intelligence generally, should take into account data protection principles like data minimization, proportionality, necessity and time limitation. Practically, developers should ensure that privacy is being considered from the initial design stages and throughout the development and finalization stages of apps, and by doing so, are able to demonstrate that:

  • the legal basis under which data is being processed is strictly for combatting the spread of COVID-19, and for no other purpose;
  • that clear security and organizational measures are in place to protect the integrity and safety of the personal data; and
  • that in the apps license data protection terms, data subjects are properly and fully informed of their rights, including the manner in which their personal data is being processed, the purpose of such processing, and the persons with whom such data may be shared, for example with the health authorities, and the duration of storage of the data.

Last but not least, developers must also ensure that a written contract be entered into for the development of apps and that any instructions in respect of processing of personal data in the context of the fight against the COVID-19 must, at all times, be given by the organization commissioning the development of the app, as data controller.

Adapting to COVID-19 with Background Screening Software

Ongoing COVID-19-related changes to hiring protocols are keeping recruiters and background screening software providers on their toes. While everyone’s efforts are being made to keep workplaces functioning as well as possible, it’s still important to comply with EEOC and ADA guidelines, and well as all federal guidelines regulating background reports when hiring and maintaining a workforce during this time.


Things to Remember When Screening Employees for COVID-19


When it comes to day-to-day operations, the EEOC currently allows employers to administer COVID-19 testing before employees enter the workplace. But there are a few things employers must remember during this process.


  • COVID-19 testing must be administered equally to all employees.
  • No additional screening inquiries may be administered with COVID-19 screening.
  • Wage and hour laws may apply to employees waiting to be tested and waiting for test results.
  • Employees must provide written consent to the screening and return to work policies if test results are positive.
  • All COVID-19 screening results must be kept confidential.


Background screening software provided by ClearStar may help with maintaining data security when it comes to clinical screening of employees.


COVID-19-Driven Issues with Background Screening


COVID-19 has affected workplaces across the board. Just like the private sector, staffing in the courts, public records offices, consumer reporting agencies, educational institutions, and the like has been reduced, too. Employers have to remember resources are limited for vetting candidates.


  • The results of records requests from government agencies may not be up to date.
  • Graduation details and attendance dates may not be available from schools.
  • Previous employers may not have staff available to respond to inquiries efficiently.


Therefore, if a candidate is required to supply their own background information in any of these areas, employers must be aware of laws affecting what information they’re allowed to see and whether a candidate needs to redact details from a document.


ClearStar Can Help

Our international team strives to stay on top of legal regulations surrounding our services–including and especially during times of uncertainty. Ask ClearStar how our background screening software and the team behind it can help you recruit and vet candidates as thoroughly and accurately as possible while maintaining compliance with current and evolving needs.

Why Background Check Services are Important for Virtual Interviews

Pandemic or not, there’s a lot to be said for a virtual workforce. But employers who are new to this M.O. are on quite a learning curve­—starting with recruiting and vetting job candidates. Virtual recruitment isn’t completely new, but businesses that have previously leaned on that in-person connection before making a job offer now have to navigate making their character and skill judgments virtually, too. Background check services become a real advantage at this point in the hiring process.

What You Save vs. What You Gain

The biggest perk to having a virtual hiring process and the virtual team is the cost savings, of course, but what’s gained in savings can be lost in a feeling of connection among the team members. That feeling begins with the interview process. Being certain a new hire is exactly who they say they are can go a long way toward helping the existing team build trust with its newest members. Background check services can research your candidate’s claims about education, degrees, certifications, work history, and more.

Body language cues can also be lost during virtual interviews. It’s easier for a virtual candidate to multitask or falsify a digital application without a recruiter knowing until far into the hiring process. Beyond the regular background check of a candidate’s work history claims, modern and experienced background check services analyze a candidate’s web presence and communicate concerns while maintaining compliance with EEOC and privacy regulations. Social media screening and other web-based resources can be a big source of legal trouble for recruiters who are unfamiliar with ever-changing legal regulations surrounding them. Getting experienced help with this kind of vetting can save recruiters time and money.

Background Check Services Have Your Back

Whether virtual recruiting and interviewing is your specialty or a completely new way of doing business, ask ClearStar to back up your hiring choices with background check services that ensure you’ve made the best offers to the best candidates.

The Power of Agility

Hi, I’m Ken Dawson, CIO/CISO of ClearStar. Anybody who knows me will not be surprised by this, but I’m going to use a space company—SpaceX—and their recent successes to illustrate some lessons on agility. I spend a lot of my free time following the space industry, with a focus on SpaceX and other commercial companies like Blue Origin and Rocket Lab. When looking at what SpaceX has accomplished and how, a lot can be attributed to their agile approach and culture, which certainly seems to come from its founder—Elon Musk—whose other companies exhibit this trait as well.

Focus on the Main Thing

The most difficult aspect of staying agile for many of us is knowing what to focus on. The key is that we can’t be committed to a specific outcome or approach but must be able to define the properties of a successful implementation. It’s much easier and often more comfortable for us to pre-determine what we want a solution to look like, what features it should have, and what the best architecture is. If we want to be more agile in the way we deliver value to people, then we should instead be defining what the successful solution can accomplish, who will benefit from it, and what value it will provide.

An example of this is the recent Demo-2 mission where SpaceX, under a NASA contract and with their help and support, became the first commercial company to launch people into orbit and provided NASA with the first human launch to orbit from U.S. soil since 2011. This was a great accomplishment, but it’s worth noting that the Crew Dragon1 capsule that went to the International Space Station (ISS) was very different in some major ways from the original design.

FTPR The Power of Agility 2 - The Power of Agility
Figure 1: Crew Dragon

The overall goal of safely delivering astronauts to the ISS and bringing them home safely (planned for some time in August) was the most important aspect of determining a successful capsule. The initial designs called for the capsule to land on land, pretty much anywhere, under the power of its on-board rockets. Well, at some point it was determined that while this was possible (concept proven out to some extent by their Falcon 9 landings), it was not going to be practical because the time, cost, and requirements of getting NASA to certify this new approach of returning astronauts safely to Earth were not worth the effort and were not required to meet the goal. So, they pivoted to parachutes and a water landing, both of which NASA had experience with, and moved forward keeping the overall goal in mind.

As it turns out, that design wasn’t wasted as SpaceX was able to make the necessary changes to use those rocket motors to power the launch escape systems. After the fact, it may be easy for all of us who are watching them to see the wisdom in this and recognize how it benefitted SpaceX and NASA, but I’m sure it wasn’t a fun decision and it made them rethink a lot of things that they had already planned on. This showed agility because they were willing to throw away their plans, approaches, and designs when needed to keep on track.

Failure is Good—If It Happens Fast

The next important aspect of being agile is to be more than just accepting of failure—but to encourage it. We want to be agile because we want to be innovative in some way, meaning we’re trying to do or build something in a way that is different than what has been tried before—all so we can be more successful in achieving our goals. A great quote from Elon Musk on this topic is, “If things are not failing, you are not innovating enough.”2 The key in this for agility is not that you fail, because you will if you’re trying to be innovative, but is how and why you fail.

If you’re not failing, it can mean that you’re either being too conservative in your approach—trying things that have already been done by others—or that you’re being careful in terms of how hard you push things. It can be frightening to think that we’re going to build things that we expect to fail, making us question the whole concept: What happens to our schedule, how much will it cost, and how do we know it will lead to a better solution? There are two keys to handling this uncertainty: speed and iteration. We don’t want to build full solutions and then push them to their limit. Our objective is to build the smallest independent unit we can, push it to the point of failure as quickly as possible, and then learn from the failure to build the next iteration. In this way, we minimize the risk and negative impact of the failure while maximizing our ability to make changes based on what we learn. This process of iterating based on what we learn doesn’t stop once a component or full product is completed but will continue for the life of the product.

FTPR The Power of Agility 3 300x199 - The Power of Agility
Figure 2: Two Falcon 9’s (Falcon Heavy Side Boosters) landing at the same time

The SpaceX Falcon 9 rocket is an excellent example of this approach. The entire rocket has changed in dramatic ways from v1.0 to the current Block 5 version (see a great article on this here). What I want to focus on is the landing and the changes to support it. The first two versions (depending on how you’re counting) didn’t have any hardware to support landing the rocket, even though reusability was a central goal to the Falcon 9 program. By version 1.1, SpaceX added landing legs and grid fins to allow the first attempts at landing and reuse. If you go to the article or search the web for “Falcon 9 versions images”, you’ll see various drawings and pictures that show the changes to the landing legs and grid fins across different versions. All of these came in the form of iterations based on failure—from spectacular misses (see YouTube) to landings that were shaky or off center to the double landing of two Falcon 9’s3. The one outcome that they all shared (even the successes) was that SpaceX learned from them and made improvements in the next builds and versions; they didn’t wait to redesign the whole thing from scratch.


The whole point of focusing on agility is achieving results that drive our product and company forward, increasing revenue and profits, and just making the things we do better. If we focus on what defines a successful outcome, consider any and all potential changes on their merit, and use early failure to drive iteration and continuous improvement, we will be well on our way to using agility to drive the success of our organization. This is for the record.


For The Public Record is a monthly blog featuring thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process. Click here to subscribe.

Is Social Media Screening Helping or Hurting Recruiting?

Virtual networking via LinkedIn, third party career sites, and brand-owned subdomains have been normal ways of doing business for years, of course, but the high employment numbers of the late 2010s created some serious competition in the world of recruiting. Seeking an edge to get ahead, recruiters turned to dedicated accounts on Twitter, Facebook, and other social media platforms specifically to post job openings and recruit the best candidates. But even those recruiting tactics eventually led to in-person interviews.


Today­–thanks to COVID-19 safety protocols–business owners are having to explore new possibilities. And, pandemic or not, virtual employees are looking like a smart business decision. That means virtual interviewing and vetting is about to become the norm.


The Legal Risks of Social Media Screening


Social media screening of job candidates is just a natural next step in a recruiting process that’s gone entirely virtual, but employers need to know that leaning on previously untested screening processes can lead to legal risks. More specifically, HR teams must have policies in place before implementing social media screening as part of a vetting process because including it as part of a background check can lead to unintentionally discriminatory and/or negligent hiring practices.


How can social media screening lead to discrimination? As we all know, a Facebook or Instagram presence provides a different look into a user’s life than their LinkedIn profile does. Viewing content that was intended for friends can lead a recruiter to make determinations for or against hiring that’s not legally allowed to be considered for that purpose. Anything from hobbies to religious affiliations can create a bias for or against a candidate whether the recruiter meant to consider them or not.


As for negligence, the risk may come after the fact. For example, if a new hire behaves violently towards coworkers or perpetrates a crime in the workplace and there were clues to this behavior in their social media profiles, the recruiter who viewed those profiles won’t be able to claim lack of knowledge of the risk. In both cases, any connection to a candidate’s social media presence can create a legal problem for the employer down the road.


Safer Screening Solutions


Candidate background screening may be better performed by an unbiased third party who knows how to maintain compliance with applicable employment laws. ClearStar mitigates your risks by monitoring ever-changing federal, state, local, and industry-specific employment laws and adapting processes to ensure compliance. Because of COVID-19, protocols are changing fast for most employers. Don’t take unnecessary risks! Ask ClearStar how we can help your business with safe and effective remote candidate background screening solutions today.

5 Tips on Employment Screening for Remote Workers

Shelter-in-place orders during the COVID-19 public health emergency have been a boon for remote workers but a jolt to employers who’ve had to adapt hiring protocols to this “new norm.” Whether your business is planning on going remote permanently or only as required for now, here are five tips on employment screening for remote workers to help you secure the best candidates for your team.


  • Determine What Kind of Employee Will Best Suit Your Needs


Working with someone you interact with in person five days a week is different than working with someone you won’t set eyes on nor talk to except via virtual chat or email most of the time. Before the first interview, establish what kind of characteristics are needed for the role. Do you need a self-starter or someone to just complete assignments? Does the candidate need to have a strong presence for delivering presentations over video conferences or can they be soft-spoken and mild-mannered? Drafting an outline of this ideal character will likely be a work in progress, but you can pull ideas from anyone on the team who’s managed a remote worker or even worked as one.


  • Develop Questions that Will Invite Deeper Conversation


Doing interviews face-to-face allows you to make a connection and take in a lot of physical cues from your candidate. Doing interviews remotely–whether over the telephone or via video conference–makes it harder to feel like you’re really getting to know someone. In order to get the right kind of information about a candidate, draft questions specific to how they would perform the type of work required, their organizational style, their problem-solving skills, and their ability to work on their own. And, as every good journalist knows, asking yes/no questions gets you answers like “yes” and “no.” Ask open-ended questions to get more complete and thoughtful answers.


  • Use More Than One Interview Method


Since your candidate will be working remotely and communicating with your office through a variety of platforms, get to know them via those same platforms. It will help you understand their technical ability and communication style when they’re talking one-on-one (phone), interacting with multiple co-workers at a meeting (video chat), or when they’re writing (email).


  • Give the Candidates Some Homework


If you’ve whittled down the list to the final candidates, give them all a sample project to complete on their own. Assign something related to the role that can be completed without access to deep internal resources. Make sure to give the same project to each candidate so you can compare how each one completes tasks, finds solutions, and meets a deadline.


  • Be Cautious About Social Media Screening


It will be tempting to scour the internet for background information on your remote workers but be careful. Social media screening must be done according to established protocols and by someone who understands the risks. Taking in all that personal information can lead to legal issues down the road; a topic addressed on our next blog.


If you need a partner to help with employment screening for remote workers or on-site workers, ask ClearStar how our technology solutions and the experienced, international team can support your hiring needs.

May 2020 Screening Compliance Update

Federal Developments

EEOC Updates Guidance to Permit Employer-Mandated COVID-19 Testing (U.S.)
As the COVID-19 public health emergency begins to (hopefully) progress down the curve and employers contemplate reopening and returning employees to the workplace, many employers are considering what measures they can implement to ensure that returning employees are not infected with the SARS-CoV-2 virus. In March 2020, the U.S. Equal Employment Opportunity Commission (EEOC) issued guidance confirming that in light of the pandemic, employers not only can ask employees about virus-related symptoms, but also can require that employees submit to temperature testing. However, as we all have learned, not all COVID-19 infected persons have a fever.

As molecular and serological testing becomes more available, and in particular, tests that provide rapid results, employers have begun to assess whether to require employees to submit actual COVID-19 testing as a condition of entering the workplace, rather than rely on self-reporting or unreliable temperature tests. Under typical circumstances, such a requirement would present substantial concerns under the Americans with Disabilities Act (ADA), which generally forbids employer-mandated medical testing unless that testing is job-related and consistent with job necessity. However, on April 23, 2020, the EEOC updated its COVID-19 guidance to confirm that under the current circumstances presented by the pandemic, “employers may choose to administer COVID-19 testing to employees before they enter the workplace to determine if they have the virus” “because an individual with the virus will pose a direct threat to the health of others.”

The guidance explains that employers that decide to require testing should ensure that the tests are accurate and reliable. It also emphasizes that employers should continue to require employees to adhere to infection control best practices, i.e., social distancing, frequent handwashing, etc.

Although the updated guidance provides a welcome signal that employer-required COVID-19 testing will not run afoul of the ADA, employers must be mindful that a decision to require testing implicates many other important considerations. For example, employers must ensure that any information obtained from testing is kept confidential. Employers also must consider whether time spent by employees taking tests is compensable time under the Fair Labor Standard Act and state wage payment laws. And employers must consider potential liabilities associated with possible false-positive and false-negative test results. Accordingly, employers should strongly consider consulting with counsel to discuss these and other issues prior to implementing a mandatory COVID-19 testing protocol.

OSHA Issues Revised Guidance for Recording COVID-19 Cases
On Tuesday, May 19, 2020, the Occupational Safety and Health Administration (OSHA) issued new enforcement guidance regarding an employer’s obligation to record cases of COVID-19 on the OSHA injury and illness logs. The new guidance takes effect Tuesday, May 26, 2020, and will supersede OSHA’s previous guidance that was issued on April 10, 2020.

Under the new guidance, the key question remains whether a case of COVID-19 is “work-related.” As with the previous guidance, OSHA continues to acknowledge that it will be difficult to establish that a particular COVID-19 case is work-related “especially when an employee has experienced potential exposure both in and out of the workplace”—but the new guidance does place additional obligations on most non-healthcare employers to conduct this analysis and to make a reasonable determination.

OSHA’s COVID-19 Recordability Test
OSHA’s recordkeeping rules apply to injuries or illnesses. As COVID-19 began to spread across the country, OSHA confirmed that COVID-19 can be a recordable illness if a worker is infected as a result of performing work-related duties. However, OSHA’s original guidance from April 2020 directed that most non-healthcare employers did not need to determine “work-relatedness” of COVID-19 cases—and therefore did not need to record them—unless the employer had “objective evidence” that the cases were work-related. Under the new guidance, OSHA affirms that COVID-19 may be a recordable illness, and now states that all employers—including non-healthcare employers—are responsible for conducting a reasonable analysis of COVID-19 cases and recording cases of COVID-19, if:

  1. The case is a confirmed case of COVID-19 (as opposed to an employee exhibiting symptoms but not diagnosed with the virus), as defined by the Centers for Disease Control and Prevention (CDC);1
  2. The case is “work-related”—e., an event or exposure in connection with the employee’s work either caused or contributed to the COVID-19 case; and
  3. The case involves one or more of the general recording criteria, including, among other things, death; days away from work; or restricted work or transfer to another job.

The New Guidance on Whether COVID-19 Cases are Work-Related
As noted, OSHA’s prior guidance (which remains in effect through May 26, 2020) created different paths for different types of employers regarding the recording of COVID-19 cases. The first framework was for healthcare employers, emergency response organizations, and correctional facilities. The second framework was for all other employers. Under the revised guidance, in determining whether employers have complied with their recordkeeping obligations, OSHA will consider the following:

The reasonableness of the employer’s investigation into work-relatedness.
Employers are not expected to undertake extensive medical inquiries, given privacy concerns and most employers’ lack of medical expertise. However, in most circumstances, employers should complete the following steps when they learn of a COVID-19 case:

  1. Ask the employee how they believe they contracted the illness;
  2. Discuss with the employee, while respecting privacy concerns, the activities both inside and outside of work that may have led to the illness, and
  3. Review the employee’s work environment for potential COVID-19 exposure.

The review of the work environment will primarily be focused on other instances of workers who contracted COVID-19, and the circumstances surrounding those other cases. An employer’s implementation and enforcement of steps to address the spread of COVID-19 in the workplace consistent with guidelines from the CDC and OSHA (including, for example, the use of face coverings, social distancing, and cleaning procedures) may also be a consideration in the employer’s analysis of work-relatedness.

The evidence available to the employer.
OSHA’s updated guidance recognizes that an employer cannot know everything about a particular employee’s exposure, and that a determination as to whether a COVID-19 case is work-related should be based on information reasonably available to the employer at the time it made the determination. If the employer later learns more information related to an employee’s COVID-19 illness, however, OSHA may use that information to evaluate whether the employer made a reasonable work-relatedness determination.

The evidence that a COVID-19 case was contracted at work.
OSHA specifically recognizes that the difficulty of determining whether a COVID-19 illness is work-related and acknowledges that there is no formula for determining work-relatedness. With this in mind, OSHA will look for certain types of evidence that weigh in favor or against work-relatedness. OSHA’s updated guidance provides that COVID-19 illnesses may be work-related when, for example:

  • Several cases develop among workers who work closely together and there is no alternative explanation.
  • It is contracted shortly after a lengthy, close exposure to a particular customer or coworker who has a confirmed case of COVID-19 and there is no alternative explanation.
  • The employee’s job duties include frequent, close exposure to the general public in a locality with ongoing community transmission and there is no alternative explanation.

On the other hand, OSHA provides that COVID-19 illnesses are likely NOT work-related when:

  • The employee is the only worker to contract COVID-19 in the vicinity and the worker’s job duties do not include having frequent contact with the general public, regardless of the rate of community spread.
  • The employee, outside the workplace, closely and frequently associated with someone (e.g., a family member, significant other, or close friend) who (1) has COVID-19; (2) is not a coworker; and (3) exposes the employee during the period in which the individual is likely infectious.

Further, OSHA will also give weight to evidence of causation from the employee, the employee’s medical providers, and the public health authorities where that information is available.

If, after making a reasonable inquiry under the factors outlined above, an employer cannot determine whether it is more likely than not that the COVID-19 case is work-related, then the employer does not need to record the illness.

The Bottom Line
OSHA’s new guidance creates a single framework for recording work-related cases of COVID-19 for all employers with recording obligations under OSHA’s recordkeeping rule, imposing greater obligations for the vast majority employers outside the healthcare, emergency response, and correctional facility context. The key for all employers will be to conduct a reasonable and objective evaluation of work-relatedness and to then make the appropriate determination.

CDC and OSHA Issue COVID-19 Guidance for the Nursing Home Industry
During the COVID-19 pandemic, nursing homes and care facilities have instituted significant precautions and protocols to address employee and resident safety. The Centers for Disease Control and Prevention (CDC) and federal Occupational Safety and Health Administration (OSHA) have both recently published guidance documents to assist guide nursing home employers in their response. The CDC has issued Considerations for the Public Health Response to COVID-19 in Nursing Homes, (April 29, 2020). This guidance is intended to assist nursing homes and public health authorities with response in nursing homes. This guidance supplements but does not replace recommendations included in the CDC’s earlier Interim Additional Guidance for Infection Prevention and Control for Patients with Suspected or Confirmed COVID-19 in Nursing Homes. OSHA just issued a COVID-19 Guidance for Nursing Home and Long Term Care Facility Workers, (May 14, 2020), which employers can follow to help protect nursing home workers and long term care facility workers from exposure to the coronavirus.

The CDC advises that nursing homes should:

  • Act now to implement all COVID-19 preparedness recommendations, even before cases are identified in their community
  • Address asymptomatic and pre-symptomatic transmission, implement source control for everyone entering a healthcare facility (e.g., healthcare personnel, patients, visitors), regardless of symptoms.
    • Cloth face coverings are not considered personal protective equipment (PPE) because their capability to protect healthcare personnel (HCP) is unknown. Facemasks, if available, should be reserved for HCP.
    • For visitors and residents, a cloth face covering may be appropriate. If a visitor or resident arrives to the facility without a cloth face covering, a facemask may be used for source control if supplies are available.
  • Dedicate an area of the facility to care for residents with suspected or confirmed COVID-19; consider creating a staffing plan for that specific location.

In its nursing home and long-term care facility workers news release and alert, OSHA suggests the following measures that can help protect employees working in nursing homes and long term care facilities, including:

  • Require workers to stay home if they are sick;
  • Screen workers and residents regularly for signs and symptoms consistent with the coronavirus. Send sick workers home or to seek medical care;
  • Closely monitor and take additional precautions regarding employees and residents who may have been exposed to an individual with the coronavirus;
  • Follow CDC guidance on updating existing resident visitation policies;
  • Ask visitors to inform the facility if they develop a fever or symptoms consistent with the coronavirus within 14 days of their visit;
  • Maintain at least 6 feet between workers, residents, and visitors to the extent possible, including while workers perform their duties and during breaks;
  • Stagger break periods to avoid crowding in breakrooms;
  • Consider alternatives to in-person large group gatherings (e.g., staff meetings, resident activities);
  • Always follow good infection prevention and control practices. Consult OSHA’s COVID-19 guidance for healthcare workers and employers.
  • Provide handwashing facilities and alcohol-based hand sanitizer with at least 60 percent alcohol throughout facilities;
  • Regularly clean and disinfect shared equipment and frequently touched surfaces in resident rooms, staff workstations, and common areas;
  • Use hospital-grade cleaning chemicals approved by the Environmental Protection Agency (EPA) from List N or EPA-approved, hospital grade cleaning chemicals that have label claims against the coronavirus;
  • Ensure workers have and use any personal protective equipment (PPE) they need to perform their jobs safely;
  • Continually monitor personal protective equipment (PPE) stocks, burn rate, and supply chains. Develop a process to decontaminate and reuse PPE, such as face shields and goggles, as appropriate. Follow CDC recommendations for optimization of PPE supplies;
  • Train workers about how to protect themselves and residents during the pandemic; and
  • Encourage workers to report any safety and health concerns.

These recommendations are consistent with OSHA’s general guidance for employers and likely also apply to private duty aides employed by residents’ families. By following this guidance, where feasible, employers can demonstrate compliance with OSHA’s General Duty Clause to maintain a workplace free from any recognized hazard. Compliance will also demonstrate the employer’s adoption of the standards of care to reduce liability for state tort claims.

In addition, the Governors of New York and Texas have recently directed that nursing home workers be tested for COVID-19. While in Texas such testing is to be carried out by State agencies, in New York, preliminary indications are that the facilities will be responsible.

Implementing these guidances and directives raises a myriad of additional legal considerations. In developing a COVID-19 workplace safety and testing program, facilities should not overlook both general and COVID-specific issues such as immunity from liability, informed consent, employee accommodations, resident rights and information privacy.

CDC Issues Guidelines for Reopening
The Centers for Disease Control and Prevention (CDC) recently issued guidance titled “CDC Activities and Initiatives Supporting the COVID-19 response and the President’s Plan for Opening America Up Again.” The 60-page document details the initiatives, activities, and tools the CDC is using to support the effort to reopen the country amid the ongoing COVID-19 emergency, as well as interim guidance for childcare programs, schools and day camps, employers with high-risk workers, restaurants and bars, and mass transit administrators.

CDC Priorities and Initiatives

As part of its new guidance, the CDC has identified COVID-19 testing as essential to reopening the economy, and the guidance thus includes recommendations for prioritizing patients for testing, improving the reliability and efficacy of testing, and making testing and monitoring more widely available.

The CDC is also working with federal government partners to provide support to states to expand their testing programs. The CDC’s focus is on assisting states with developing state-specific testing plans that address the unique needs of each state, rather than implementing or mandating a blanket testing program. The CDC is also providing support by augmenting state public health laboratories with needed testing supplies, such as testing devices and reagents and working with the White House Coronavirus Task Force to ensure the available commercial market is able to support the proposed expanded state testing efforts. The CDC’s stated goal is to achieve a rate of less than 10% positive COVID-19 tests among symptomatic, asymptomatic, and pre-symptomatic individuals.

The CDC is also focused on improving testing for surveillance and outbreak control so it may identify and respond to virus clusters before they spread. This effort includes using existing, nationwide surveillance systems to identify potential outbreaks, including use of the CDC’s Influenza-Like Illness Network and the National Syndromic Surveillance Program as well as enhancing case investigation and contact tracing through increased public health staff and rapid testing capability.

The guidelines further call for increased testing of asymptomatic individuals, and clear indications for serologic testing, given the utility of serologic testing for understanding the transmission of the virus, and potential immunity in the population. Lastly, the CDC is focused on improving existing infrastructure and technology to improve data flow and case reporting. These efforts include aiding in the development and integration of solutions to expand state and community-wide sites to ensure citizens receive comprehensive, up-to-date information about the prevalence of the virus in each community.

Phased Reopening
Apart from its guidance aimed at expanding COVID-19 testing, the CDC has proposed a three-phased plan for reopening that outlines an approach for relaxing community mitigation measures while protecting vulnerable populations, such as the elderly and those with underlying health conditions. In conjunction with the three-phased approach, CDC guidelines propose the use of six “gating criteria” that should be assessed before progressing into the next phase of reopening. The approach can be implemented statewide or community-by-community at each state governor’s discretion.

These gating criteria include decreases in newly identified COVID-19 cases, decreases in emergency department and/or outpatient visits for COVID-19-like illness, and the existence of minimum infrastructure for a robust testing program. As an example, to enter Phase 1 of reopening, a community would assess the gating criteria of decreases in newly identified cases and would need to determine whether there is a downward trajectory (or near-zero incidence) of documented cases over a 14-day period. Consideration between phases should be given to such factors as existing public health capacity based on certain measurable criteria, such as contact tracing and incidence relative to local public health resources. The guidance acknowledges some communities may progress sequentially through the reopening phases while other jurisdictions may end up moving backwards at certain points, based on an ongoing assessment of the gating criteria against the threshold for entering each phase.

Additional Guidance
The guidance also includes a proposed operational plan for surveillance of COVID-19 cases, health care system capacity surveillance, and guidance on infection control, contact tracing, and test usage.

Setting Specific Guidance
The CDC has included updated guidance to assist specific types of businesses as they begin to reopen, with a “menu” of safety measures contained within three steps that businesses may use as a reference as they “scale up” their operations. Businesses are free to choose the measures applicable to their operations and local community, as well as applicable state and local requirements. Mitigation efforts will continue to be necessary even at the highest step until a vaccine or therapeutic drug becomes widely available.

Employers with Workers at High-Risk
The guidance recommends that as workplaces begin to scale up activities towards pre-COVID-19 operating practices, they recognize some workers are at higher risk for severe illness from COVID-19. Such workers include individuals over age 65 and those with underlying medical conditions, such as chronic lung disease, hypertension, weakened immunity, or severe obesity. Workers at higher risk for severe illness should be encouraged to self-identify, and employers should avoid making unnecessary medical inquiries. Employers should consider carefully how to reduce workers’ risk of exposure to COVID-19 consistent with relevant Americans with Disabilities Act (ADA) and Age Discrimination in Employment Act (ADEA) regulations and EEOC guidance.

The recommended steps for scaling up are:

  • Step 1: Scale up only if business can ensure strict social distancing, proper cleaning and disinfecting requirements, and protection of their workers and customers; workers at higher risk for severe illness are recommended to shelter in place.
  • Step 2: Scale up only if business can ensure moderate social distancing, proper cleaning and disinfecting requirements, and protection of their workers and customers; workers at higher risk for severe illness are recommended to shelter in place.
  • Step 3: Scale up only if business can ensure limited social distancing, proper cleaning and disinfecting requirements, and protection of their workers and customers.

The CDC guidance further notes that employers should protect employees at higher risk for severe illness by considering accommodations, such as offering them options to work remotely and/or job duties that minimize contact with others.

Child Care Programs
The CDC guidance includes a gradual scale up of childcare programs towards pre-COVID-19 operating practices, because such programs are crucial to helping parents and guardians return to work. Because all jurisdictions may not implement the same plan, the CDC guidance notes that all decisions about following the recommendations should be made locally, in collaboration with local health officials who can help determine levels of COVID-19 community transmission and the capacities of the local public health system and health care systems.

The recommend steps for scaling up are:

  • Step 1: Restrict to children of essential workers.
  • Step 2: Expand to all children with enhanced social distancing measures.
  • Step 3: Remain open for all children with social distancing measures.

Schools and Day Camps
As communities scale up to pre-COVID-19 operating practices in K-12 schools and summer day camps, the CDC provides recommendations for keeping communities safe while resuming peer-to-peer learning and providing support for parents and guardians returning to work.

The recommended steps for scaling up are:

  • Step 1: Schools that are currently closed should remain closed. Distance learning should be provided for all students. School meal programs and other support services should be offered, as feasible. Camps should be restricted to children of essential workers and for children who live in the local geographic area only.
  • Step 2: Remain open with enhanced social distancing measures. Restrict attendance to children of essential workers and children who live in the local geographic area only.
  • Step 3: Remain open with distancing measures. Restrict attendance to children of essential workers and children from limited transmission areas (other Step 3 areas) only.

Restaurants and Bars
The guidance provides recommendations for how food service industry businesses can maintain operations and a safe and healthy work environment for employees, while reducing the risk of COVID-19 spread for both employees and customers.

The recommended steps for scaling up are:

  • Step 1: Bars remain closed and restaurant service should remain limited to drive-through, curbside take out, or delivery with strict social distancing.
  • Step 2: Bars may open with limited capacity; restaurants may open dining rooms with limited seating capacity that allows for social distancing.
  • Step 3: Bars may open with increased standing room occupancy that allows for social distancing; restaurants may operate while maintaining social distancing.

Mass Transit Administrators
Mass transit is critical for many individuals to commute to and from work and to access essential goods and services. The guidance provides recommendations for how mass transit administrators can maintain healthy business operations and a safe and healthy work environment for employees, while reducing the risk of COVID-19 spread for both employees and passengers.

The recommended steps for scaling up are:

  • Step 1: Restrict ridership to essential critical infrastructure workers in areas needing significant mitigation and maintain strict social distancing as much as possible.
  • Step 2: Maintain social distancing between transit riders and employees as much as possible.
  • Step 3: Encourage social distancing as much as possible

Finally, for all of these categories, the guidance also includes suggested safety actions, approaches for monitoring and preparing for cases, recommendations for promoting social distancing, staff training, and hygiene protocol, based on the specific setting The CDC indicates it will update the guidance as it learns more about COVID-19 and best practices to prevent its continued spread. 

Big FCRA Changes Ahead? HEROES Act Would Ban Reporting of Adverse Information During National Emergencies—But Is This Workable?
A1,815-page House bill has just been introduced that affords $3 trillion in relief to consumers and businesses impacted by COVID 19. The bill (official title: the Health and Economic Recovery Omnibus Emergency Solutions Act, or “HEROES Act”) addresses numerous topics, but I’d like to focus on one: amendments to the Fair Credit Reporting Act (“FCRA”) designed to prevent reporting of adverse information arising out of a national emergency. However well-intentioned these provisions may be, they work an extreme—some might say unworkable and crazy— shift to the credit reporting landscape. If implemented, these changes would have significant negative impact on the financial services industry and consumers’ ability to get credit at rates reflecting their true repayment risk. The House will vote on the bill this Friday but—unsurprisingly given the bill’s drawbacks— the odds of it passing the Senate and being signed by the President in its current form lie somewhere between very unlikely and a snowball’s chance in Hell. Below are a handful of the troublesome amendments to the FCRA proposed by the HEROES Act:

  • All Adverse Information Arising from “Major Disaster” Must Be Excluded from Consumer Reports. Under the HEROES Act, consumer reporting agencies (“CRAs”) are prohibited from including “an adverse item of information” (other than a felony conviction) that was the result of “any action or inaction that occurred” during a period declared to be a “major disaster” by the President. There is a similar prohibition on furnishers furnishing such adverse information to CRAs. Think about that. But when is an adverse fact “the result of” an action or inaction that occurred during an emergency? Some cases are easy—I’ve been in the hospital for two months with COVID-19, couldn’t work and so missed payments on my credit cards and mortgage. Fine. But if I’m a CRA and two years from now I want to include a bankruptcy in a consumer report, how could I possibly know if there was some action or inaction that took place during the pandemic such that the bankruptcy could be said to have “resulted” from such action or inaction? It’s an impossible standard.
  • A Catalog of Consumer Woe? HEROES Would Create CFPB Website to Track Consumers’ Economic Hardships. The HEROES Act requires the Consumer Financial Production Bureau (“CFPB”) to establish a website where consumers can report “economic hardship” as a result of a major disaster, including the current COVID-19 pandemic. It does not state that specified events resulting from such hardship (liens, bankruptcies, missed loan payments, etc.) are to be reported or otherwise elaborate on what constitutes an “economic hardship” for purposes of this website. It does, however, require the three credit bureaus and CRAs that qualify as “nationwide specialty consumer reporting agencies” to check this CFPB website weekly and delete from their databases “adverse items of information as soon as practicable after information that is reported appears in the database.” But how will a CRA know what to delete if consumers are not required to be specific about what events are a product of their “economic hardship”? Oh, and the HEROES Act prohibits the CFPB from requiring any consumer to produce any documentation substantiating their claim of economic hardship. Makes sense! Then there are the privacy implications of allowing/encouraging/requiring consumers to catalog their hardships in a centralized government database.
  • Guidance Regarding the Treatment of Missed Payments Is Insufficient. As noted above, the HEROES Act prohibits CRAs from reporting adverse items of information. That leads to some tricky situations. For instance, suppose a bank’s records show that in some months during the pandemic the consumer made payments on his outstanding credit card balance and in some months he did not. Under the HEROES Act, CRAs are not allowed to report the missed payments because they are “adverse items of information.” So the bank will furnish CRAs with payment history for only the months in which he made payments. How does the CRA then report that information without signaling that the consumer didn’t make the payment during the months not reported?
  • Debt Collection. Debt collectors routinely obtain consumer reports prior to attempting to collect a debt in order to confirm that debtors have not declared bankruptcy. If a consumer declares bankruptcy during a pandemic but CRAs can’t notify debt collectors of such bankruptcy, then debt collectors either run the risk of violating the law by attempting to collect debt from a bankrupt debtor or it has to stand up internal processes to check relevant sources to determine whether the debtor is bankrupt, adding significant cost to the collection effort. This will be an unfair burden for debt collectors and increase the cost of credit for consumers.
  • Making Credit More Expensive. While the HEREOES Act raises many questions regarding reporting adverse information during an emergency, one thing is clear—the cost of credit is going up if the HEREOES Act becomes law. When lenders have more information about consumers, they can make finer distinctions among consumers about their relative default risks, which leads to better terms for many consumers. This is the main driver behind the push towards “alternative credit data”: it allows lenders to identify potential borrowers that are a good credit risk in a pool of consumers that don’t have much of a footprint in the traditional credit universe because, g., they lease an apartment, do not use credit cards or don’t have checking accounts. To the extent regulatory prohibitions limit what data lenders are allowed to use in underwriting, the less lenders are able to offer loan terms that match a consumer’s true credit risk, making credit more expensive for everyone. This would undoubtedly happen if the HEROES Act were to pass in its current form.


State Developments

New York City Commission of Human Rights Published a FAQ for Pre-Employment Testing for Marijuana
Marijuana Testing in Employment as of May 10, 2020, covered employers are not permitted to test job candidates for marijuana or tetrahydrocannabinols (THC) as a condition of employment. There are several exceptions, discussed further below, where testing job applicants for marijuana or THC for specific kinds of jobs is still permitted.

Q. May an employer still test current employees for drug use, despite the prohibition on pre-employment testing for marijuana?
A. Yes. The law prohibits employers from testing job applicants for marijuana or THC, with some exceptions. However, it does not change employers’ ability to drug test current employees.

Q. May an employer discipline its employees for bringing drugs to the workplace or for coming to work under the influence of marijuana or THC?
A. Yes. The law does not limit employers’ ability to ensure that their workplaces remain drug-free through policies, discipline, and other measures.

There are some exceptions to this law. Employers may require tests for job applicants applying for specific types of jobs. Testing is permissible where:

  1. Required by the U.S. Department of Transportation under 49 C.F.R. Part 40 or related state and local rules (e.g., flight crew and train dispatchers);
  2. Required by the federal government as a condition of receiving a contract or grant;
  3. Required by federal or state law “for purposes of safety or security”;
  4. A collective bargaining agreement includes terms related to pre-employment drug testing of job applicants;
  5. The position falls into one of these categories:
    • Police officers
    • Peace officers
    • Law enforcement or investigative positions at the NYC Department of Investigation
    • Positions covered by New York City Building Code § 3321, which covers certain workers at building sites
    • Positions covered by New York Labor Law § 220-h, which covers certain workers at public work sites
    • Positions requiring a commercial driver’s license
    • Positions supervising or caring for children
    • Positions supervising medical patients
    • Positions supervising vulnerable persons

The Commission is finalizing rules that will expand the list of exceptions to include the following positions:

  • Positions that regularly work on active construction sites
  • Positions that regularly operate heavy machinery
  • Positions that regularly work on or near power or gas lines
  • Positions that drive motor vehicles on most work shifts
  • Positions that fuel an aircraft, provide information regarding aircraft weight and balance, or maintain or operate aircraft support equipment
  • Positions where drug impairment would pose an immediate risk of death or serious physical harm to the employee or to other people

For claims arising between May 10, 2020 and the date when the rules are finalized, the Commission will not be filing enforcement actions related to the above-listed positions.

If you believe you have been asked to undergo testing for marijuana or THC in violation of the law, we can help. Contact the NYC Commission on Human Rights by calling 311 or call the Commission’s Infoline directly at (212) 416-0197. For more information, visit

New York City Ban on Pre-Employment Drug Testing Takes Effect May 10, 2020
Starting May 10, 2020, New York City employers may not require prospective employees to submit to testing for the presence of marijuana or tetrahydrocannabinols (or THC, the main psychoactive component of marijuana) in an individual’s system as a condition of employment. Currently, neither New York state nor New York City have any general ban on drug testing during employment.

The long-awaited ban, which was passed in April 2019 and is included as an amendment to the New York City Human Rights Law, outlines several exceptions based on the employer’s industry and the prospective position. These include, for example, police or peace officers, positions requiring a commercial driver’s license or those governed by Department of Transportation regulations, positions subject to testing under federal or state regulations or grant conditions, and positions requiring the supervision or care of children, medical patients or vulnerable persons. The new law also exempts positions that will be subject to a collective bargaining agreement that already addresses pre-employment drug testing for those prospective employees. The amendment also includes an exception for positions with the potential to impact the health or safety of employees or the public as identified by the New York City Commission.

In March 2020, the New York City Human Rights Commission issued proposed rules, which include proposed categories for safety sensitive roles, including positions that require regularly working on an active construction site, or power or gas utility lines, positions regularly operating heavy machinery, positions in which an employee operates a motor vehicle on an approximately daily basis, or positions in which impairment would pose an immediate risk of death or serious physical harm to the employee or others. The public comment period for the proposed rules has passed, but the expected finalizations of these rules has been delayed as a result of the COVID-19 pandemic.

The amendment bans only pre-employment testing for marijuana; it does not address testing for any other substance or mid-employment marijuana testing. However, all New York state employers should be mindful of the potential application of the New York medical marijuana law and applicable employment-related protections, including its relation to disability protections and accommodations under antidiscrimination laws.

Failure to adhere to the new ban on pre-employment screening can result in civil penalties up to $250,000 as well as consequential and punitive damages and attorneys’ fees.

Employers in New York City should review their existing drug-testing policies to confirm that they are in compliance with the new law, as well as contact their testing vendors to ensure any pre-employment tests comply with the new law. We encourage clients to reach out to our HR Compliance, Training and Transactions team with any questions or to review any existing policies.

Suffolk County, NY; St. Louis, MO; and Waterloo, IA Are The Three Most Recent Localities to Enact Ban-the-Box Laws.
These laws restrict private employers’ ability to inquire into a job applicant’s criminal history. Suffolk County and St. Louis prohibit such inquiries until after an initial interview, while Waterloo prohibits such inquiries until after a conditional offer of employment has been made. St. Louis’ law will take effect on July 1, 2020, Suffolk County’s law will take effect August 25, 2020, and Waterloo’s law will take effect January 1, 2021. Click here for St. Louis, here for Suffolk County, and here for Waterloo.

Virginia Governor Signs Marijuana Decriminalization Law Containing Employment-Related Provisions
On May 21, 2020, Virginia Governor Ralph Northam signed legislation (HB 972/SB 2) to decriminalize simple marijuana possession and prohibit employers from requiring applicants to disclose information related to past criminal charges for such possession. The law will take effect July 1, 2020.

Currently, Virginia law allows individuals charged with marijuana possession to be fined and/or to be imprisoned for up to 30 days for a first offense. Subsequent offenses may be charged as Class 1 misdemeanors punishable by up to one year in jail and/or a fine of up to $2,500. The new law decriminalizes possession of up to one ounce of marijuana, punishable by a fine of no more than $25.

Additionally, the law provides that convictions for simple marijuana possession will not be reflected on a person’s criminal record. Records relating to prior charges for these minor offenses—including being arrested for, charged with, or convicted of such conduct—will generally no longer be open to public inspection and disclosure, with narrow law-enforcement-related exceptions (e.g., to determine eligibility to possess or purchase a firearm, to prepare a pretrial investigation report, and for certain employment opportunities with certain state agencies). If, however, a person is found to have possessed marijuana while operating a commercial motor vehicle, that violation will be reported to the state Department of Motor Vehicles and added to the person’s driving record. Employers (including state agencies and state and local governments) and educational institutions are prohibited from requiring applicants to disclose information relating to charges of simple marijuana possession in any application, interview, or during any other part of the hiring, admission, or licensing process. Anyone who willfully violates these provisions is guilty of a Class 1 misdemeanor for each violation. In addition, the law permits individuals whose simple marijuana possession charges are not pursued or otherwise dismissed, or who are acquitted of such charges, to file a petition requesting police and court records related to the charge be expunged.


Court Cases

TransUnion to Seek Supreme Court Review After Ninth Circuit Finds Class Members Had Standing and Partially Upholds Punitive Damages Award
A hotly contested ruling in a Fair Credit Reporting Act (“FCRA”) class action case will soon be appealed to the Supreme Court of the United States. The Ninth Circuit in Ramirez v. TransUnion LLC, Case No. 17-17244, recently granted the parties’ Joint Motion to Stay the Mandate, seeking to stay the Ninth Circuit’s mandate pending TransUnion’s filing of a petition for writ of certiorari in the Supreme Court. The Motion to Stay comes soon after the court denied TransUnion’s Petition for Rehearing or Rehearing En Banc regarding the Ninth Circuit’s decision in Ramirez v. TransUnion LLC, 951 F.3d 1008 (9th Cir. 2020).

In Ramirez, the Ninth Circuit held for the first time that every class member in a class action lawsuit needs “standing” to recover damages at the final judgment stage. The 8,185 member class alleged that TransUnion, knowing that its practice was unlawful, violated the FCRA by incorrectly placing terrorist alerts on the front page of consumers’ credit reports and later sending the consumers misleading and incomplete disclosures about the alerts and how to remove them. The court held that each class member was required to, and did, have standing, even though the credit reports of over 75% of the class were not actually disclosed to a third party because TransUnion’s alleged violation of the consumers’ statutory rights under the FCRA, by itself, constituted a concrete injury. The Ninth Circuit also found that the jury’s punitive damages award of 6.45 times the statutory damages award was unconstitutional and reduced it to 4 times the statutory damages award. The Ramirez decision is discussed in more detail here.

In its Petition for Rehearing, TransUnion claimed that the dissent had the correct view, and the majority’s decision “not only conflicts with Supreme Court teachings but puts the Ninth Circuit on the wrong side of a lopsided circuit split.” TransUnion argued that the class of consumers did not have standing for their FCRA claims unless their credit reports were disclosed to a third party. TransUnion further alleged that the class should have been decertified because Ramirez, the named plaintiff, “was radically atypical of the class he purported to represent” since there was no evidence that any other class member’s credit report was disseminated. Finally, TransUnion disputed the court’s punitive damages award because a reduction to 4 times the statutory damages award was not enough. According to TransUnion, the Supreme Court requires, at a maximum, a punitive damages award “equal to compensatory damages…when compensatory damages are substantial.”

TransUnion concluded its Petition for Rehearing by stating:

It is no exaggeration to say that, for many class members, the first indication that they were injured at all will be when they receive a $4,925.10 check in the mail. That absurd result is the product of ignoring basic requirements of Article III, Rule 23, and due process.

As of the date this article is published, TransUnion has not yet filed its petition for writ of certiorari in the Supreme Court.


International Developments

New Guideline on Consent Under the GDPR
Guidelines 05/2020 on consent under Regulation 2016/679 Version 1.0 was adopted on 4 May 2020.


Other Developments

Guidance for Employers Planning to Reopen in a COVID-19 World
With some areas of the country gearing up to reopen, employers are contemplating how to welcome employees and customers back safely. Employers are finding COVID-19 presents new legal considerations and a vast framework of guidance and regulations. Below we have provided a list of helpful resources and summaries identifying the relevant guidance to assist in a safe and successful re-opening of a business. Also provided are tips on developing a COVID-19 return to work plan, and the most effective way an employer can communicate to its employees, customers, vendors, and clients on the policies in place to ensure a safe and healthy business.

1. Review the Federal and Local Law
While the COVID-19 pandemic is responsible for a number of new laws, such as the Families First Coronavirus Relief Act (“FFCRA Act”) and the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), employers must also take steps to ensure that they comply with laws in place prior to COVID-19, such as the Americans with Disabilities Act (“ADA”). The coronavirus presents a conundrum for employers when it comes to providing a safe workplace free from recognized hazards that could cause death or serious physical harm because it is highly contagious and its effects on individuals range from none or minimal symptoms to death. Since the United States has not experienced a true pandemic in more than 100 years, many agencies have provided guidance to explain how the pandemic applies to current laws. Due to this uncertainty, employers should make substantial effort to review and follow the Federal guidelines. Below is a compiled and highly recommended list of federal resources:

Keep in mind, state and local agencies are also playing a critical role during the pandemic. Just like the federal government, state and local municipalities have enacted laws and regulations related to COVID-19. For example, Seattle recently passed an ordinance that prohibits commercial landlords from raising rents on small businesses, and requires landlords to establish payment plans for small businesses failing to make rent because of COVID-19.

For Washington businesses, here are a list of state resources: High Risk Employee Proclamation 20-46.

2. Developing a Reopening Plan
Every business is different, and even businesses within the same industry may have dramatically different reopening considerations, given variance in physical workplaces, workforce demographics, technology, and culture. Companies should draft reopening plans with three distinct goals: (1) compliance with federal and local laws and regulations; (2) observing best practices in order to reduce the spread of the virus; and (3) limiting liability in the event of a positive case. To achieve these goals, employers should evaluate each position and workstation in its organization in order to ensure there are no unnecessary risks of transmission. Some examples of practices that should be put in place include observing social distancing and hand washing; distributing masks to employees, visitors, and customers with the requirement that everyone wear masks while on company premises; and training managers on how to recognize and respond to an employee who may have been exposed to or is exhibiting potential symptoms of coronavirus. Taking these steps and being transparent will provide employees with the necessary confidence that they are returning to a safe working environment and that their employer had their best interest in mind when considering their specific work activities and surroundings prior to returning to operation. It is clear that efforts to reduce the spread of COVID-19 will pay hefty dividends in the form of a healthy and stable workforce and fewer work stoppages.

3. Communications with Employees, Clients, Visitors, and Customers
Some employees will be excited to return to work, while others may be reluctant. Clear and effective communication will help reduce any anxiety caused by returning to work during a pandemic. When drafting a COVID-19 policy employers should thoughtfully adopt simple guidelines that are understood by all employees and can quickly be implemented. Employers are encouraged not to overwhelm employees with COVID-19 information, but rather focus on the general steps that all employees can take to reduce COVID-19 transmissions and the specific changes to each employee’s job to reduce the risk of transmission. Furthermore, employers who have taken the time to consider every position and workstation in its operation will earn the confidence and trust of their employees faster than those who do not.

Businesses must also take into account potential COVID-19 risks with clients, visitors, and customers. First, the exposure of coronavirus and its potential deadly effects may create tortious liability against the business. Second, customers and clients may be uncomfortable with the new “normal,” resulting in them limiting public outings, or outright refusing to comply with the businesses’ COVID-19 mandates. Third, negligence claims related to virus transmissions against a business have been historically rare, but the plaintiff’s bar may take this opportunity to test these claims. Fourth, the economic circumstances may create financial incentive for customers to sue businesses related to COVID-19 transmissions.

To gain back business from customers, visitors, and clients, they must be able to trust that a business genuinely has their safety in mind. This trust will need more than documentation and operational changes. In other words, customers do not just want to be safe, they want to feel safe. Businesses may want to consider undertaking efforts to point out changes to customers, even when they are obvious. For example, a plastic barrier between a cashier and a customer will help reduce the transmission of the virus. However, a self-serving sticker on the barrier explaining that the company is using barriers to “Reduce the Spread” gives the impression that the company has engaged in extensive COVID-19 planning and may reduce the companies risk of becoming a target and has the added benefit of serving as a helpful exhibit should a matter proceed to litigation.

It is undeniable that during this unprecedented time, it is stressful to be a business owner. However, if you follow the above guidance and review the links to the federal and state materials, you will have the most up-to-date information to provide you with the confidence necessary to reopen your business knowing that you have taken all necessary steps to keep your employees, customers, and visitors safe.

A Checklist for the U.S. Food Retail Industry in Light of COVID-19 Re-openings
On April 24, 2020, Alaska became the first state to allow restaurants to reopen to dine-in customers (subject to certain precautions) since the COVID-19 pandemic began. On April 27, 2020, Georgia and Tennessee followed suit. Several other states have announced similar plans to reopen restaurants to dine-in customers throughout May.

Each state has its own requirements for re-opening, and many include some combination of the following restrictions: (1) workers must wear masks; (2) restaurants can only allow outdoor dining; (3) establishments can only be filled to a certain capacity (typically 25% or 50%); (4) reservation-only dining; and (5) hand sanitizer must be available at each table or at the restaurant’s entrance.

In light of these re-openings, we suggest that companies in the food retail industry consider the following, if they have not done so already:

  • Determine whether it is financially feasible to reopen if required to comply with the guidance set forth in the applicable order(s), or, if located in a state that has not yet provided rules for re-opening, consider which requirements would or would not be feasible.
  • Determine what supplies and goods will be required to reopen and develop a plan for sourcing the same.
  • Determine whether any physical modifications to the business will be required (i.e. barriers or screening between employees and customers and the spacing of payment terminal and cash registers).
  • Consider developing a process for providing temperature screening for employees who are showing signs of illness and review sick leave policies in order to encourage any employee that is feeling unwell to stay home.
  • Consider also requiring temperature screening of customers and develop a plan for the same, including how the customer will be informed of such requirement.
  • Determine, based on square footage, how many customers can be accommodated at any one time and develop a process for queuing customers outside of the business or a reservation process, if the business does not already have one.
  • Identify the measures that can be taken to continue to keep the workplace sanitized in line with CDC, FDA, and OHSA guidance documents. For example, the FDA released its Best Practices for Retail Food Stores, and Food Pick-Up/Delivery Services During the COVID-19 Pandemic, whereby it recommends that establishments do the following:
  • Manage employee health by, among other things, instructing employees to notify their supervisor if they know they have or have been exposed to COVID-19, and frequently disinfecting and cleaning workspaces and equipment;
  • Promote employee personal hygiene by, among other things, emphasizing washing hands for at least 20 seconds and requiring employees to use gloves to avoid direct bare hand contact with ready-to-eat foods; and
  • Manage operations by always following the four steps to food safety: clean, separate, cook, and chill.

Additionally, the OSHA released Guidance on Preparing Workplaces for Covid-19, which recommends that businesses:

  • Develop an infectious disease preparedness and response plan;
  • Prepare to implement basic infection prevention measures;
  • Develop policies and procedures for prompt identification and isolation of infected people, if applicable;
  • Develop, implement, and communicate about workplace flexibilities and protections; and
  • Implement workplace controls, such as installing high-efficiency air filters and plastic sneeze guards.

The OSHA also released its Guidance for Restaurants & Beverage Vendors Offering Takeout or Curbside Pickup, whereby the OSHA recommends that restaurants offering takeout or curbside pickup, among other things:

  • Avoid direct hand-off, when possible;
  • Display a door or sidewalk sign with the services available, instructions for pickup, and hours of operation;
  • Reserve parking spaces near the front door for curbside pickup only; and
  • Mark six-foot distances with floor tape in pickup lines, encourage customers to pay ahead of time by phone or online, temporarily move workstations to create more distance, and install plexiglass partitions, if feasible.
  • Evaluate how best to implement shift-staggering of employees.
  • Determine how to best implement the social distancing requirements.
  • Develop an enforcement mechanism for maintaining social distancing in the business, including what notices and strategies can be used to maintain separation between employees or customers.
  • Document each step of the process including the internal analysis and reasons and conclusions reached, the measures the company decides to implement, and the steps taken to execute the action plan.

Returning to the Workplace: Testing Employees for COVID-19
With the U.S. Equal Employment Opportunity Commission’s (EEOC) recent “green-light” to test employees for COVID-19 before permitting them to enter the workplace, more employers are considering incorporating testing as part of their return-to-work planning. In some instances, mandatory testing may be a reactive response to reports of employee(s) being symptomatic or testing positive. In other instances, testing may be seen as a prophylactic measure designed to both restore employee and customer confidence and mitigate against perceived litigation risk. At the same time, the federal government has not issued any mandatory guidance on testing, instead making recommendations that leave employer’s concerns to be sorted out at the state and local level, and potentially in the courthouse. Accordingly, with this alert, we explore the current “knowns” and “unknowns” associated with developing sound COVID-19 testing policies and protocols.

What We Know About Testing:

It may seem obvious, but we know that employer-mandated testing is permitted during this pandemic. As explained by the EEOC, as long as we are in a pandemic as determined by the World Health Organization (WHO), “an employer may choose to administer COVID-19 testing to employees before they enter the workplace to determine if they have the virus.” The EEOC has stated that any test must be “accurate and reliable,” and that employers can assess accuracy and reliability by consulting guidance from the U.S. Food and Drug Administration (FDA), the Centers for Disease Control and Prevention (CDC), and other public health authorities. Accordingly, the onus is on companies to ensure that whichever test they elect to administer has been deemed accurate and reliable.

We also know that employers should, according to the EEOC, “consider the incidence of false-positives and false-negatives associated with a particular test.” This means that employers cannot merely choose an approved testing method and call it a day. Rather, employers must also consider how that particular testing method’s false-positive and false-negative likelihoods may impact testing (and retesting) protocols. As discussed below, the EEOC has not elaborated as to what constitutes adequate “consideration” in this context. With that said, employers, at minimum, should mandate consistency in determining how they address the prospect of potential false positives and false negatives.

We know that an accurate COVID-19 diagnostic test only reveals whether the virus is currently present, and that a negative result does not mean that an employee will not contract the virus in the future. Accordingly, employers should be diligent regarding prevention policies in the workplace, even after testing all of their employees. Furthermore, employers should, if possible, consider administering several rounds of testing. Indeed, although not explicitly stated, the EEOC’s testing guidance tacitly condones multiple rounds of testing given the realities of virus contraction. It also discourages employers from adopting testing protocols that excuse individuals who test negative from future testing.

We know, that per the EEOC, testing is not a substitution for other infection control practices. If an employer mandates testing, it “should still require—to the greatest extent possible—that employees observe infection control practices (such as social distancing, regular handwashing, and other measures) in the workplace to prevent transmission of COVID-19.”

We know that, pursuant to longstanding EEOC guidance under the Americans with Disabilities Act (ADA), all medical information about employees should to be stored separately from their personnel file and access to this confidential information should be limited. The EEOC has also explained that employers may maintain COVID-19-related medical information in existing medical files. If an employee tests positive or has symptoms, an employer may inform persons with a need to know (e.g., that employee’s supervisor) that the employee is unable to work and is being placed on leave to quarantine and, if applicable, will be working from home. Still, and even as part of contact tracing, employers should not disclose the employee’s symptoms, test results, or health status to co-workers or other colleagues absent the employee’s consent.

We know that CDC guidance addresses how testing can play a critical role in determining whether individuals may discontinue self-isolation. For example, CDC guidance explains that a person who has demonstrated COVID-19 symptoms may discontinue isolation if the following has occurred: (i) resolution of fever without the use of fever-reducing medications; (ii) improvement in respiratory symptoms; and (iii) two consecutive nucleic-acid test results from specimens collected at least 24 hours apart have come back negative. Employers should consider consulting and incorporating this guidance from the CDC into any employee testing protocol.

Yet, we know that the EEOC’s new guidance does not require employers to test their employees for COVID-19. In fact, currently, no public health authority in the United States has instituted a mandatory testing regime. Even though employers are not required to subject their employees to COVID-19 testing, such testing, if feasible, is a method to demonstrate reasonability and provide employees and clients/customers with confidence in the business.

We know that new OSHA guidance requires employers to report confirmed cases of COVID-19 when the case is “work-related.” Under previous OSHA guidance, employers outside the healthcare/emergency responder fields were required to record positive cases of COVID-19 with OSHA only if there was objective evidence that the case was work related. However, recently issued guidance, effective on May 26, 2020, clarifies that COVID-19 is a recordable illness that must be reported on OSHA Form 300 if: (1) an employee has a confirmed case of COVID-19; (2) the employee was exposed to COVID-19 in the workplace; and (3) the case results in death, days away from work, restricted work, transfer to another job, or serious medical treatment. This new guidance specifies that merely recording an instance of COVID-19 does not mean that the employer violated any OSHA standard. It also provides employers with a list of considerations that OSHA will assess in determining whether an employer has properly reported a COVID-19 case as work-related. For example, OSHA will consider the reasonableness of the employer’s investigation into whether the infection was work-related. OSHA will also consider the evidence and information reasonably available to the employer when making the work-relatedness determination. As stated by OSHA, “[i]f, after the reasonable and good faith inquiry…, the employer cannot determine whether it is more likely than not that exposure in the workplace played a causal role with respect to a particular case of COVID-19, the employer does not need to record that COVID-19 illness.” In light of this new guidance, employers should consult with counsel to determine whether a positive COVID-19 case in the workplace should be reported to OSHA.

What We Still Don’t Know About Testing:

It is still unclear whether employers can test for COVID-19 antibodies, which indicate that a person previously had the virus. The EEOC’s permissive guidance applies to “a test to detect the presence of the COVID-19 virus.” As background, screening approaches for COVID-19 primarily include “diagnostic” tests for active infection with SARS-CoV-2 (the virus that causes COVID-19) and “immunoassays” that screen for past infection by detecting antibodies. If the language in the EEOC guidance is followed to the letter, it would appear to bar immunoassays test because they do not “detect the presence of the COVID-19 virus,” but rather indicate whether antibodies are present. Recognizing that we still do not know whether a person can be re-infected with COVID-19 (see below), it is not intuitive whether the EEOC would be permissive in viewing the purpose of immunoassays testing.

We still do not know much about the body’s immune response to the virus, including whether or not previously infected individuals develop immunity. Thus, even if employers are permitted to test employees for antibodies, knowledge that an employee previously had COVID-19 is of uncertain value. As of late April 2020, the WHO has opined there is no evidence that individuals who have recovered have immunity from the virus. Consequently, for the foreseeable future, employees that have recovered from COVID-19 and been cleared to return to work should be considered equally susceptible to the virus as other employees and should be tested accordingly.

We still have no guidance regarding the frequency of testing. In an ideal world, employers would have the ability to conduct daily testing of all employees at their discretion. At this point, however, the availability of testing kits makes that nearly impossible for most businesses, understanding that such mandatory testing could be an otherwise controversial practice. Until affordable tests are widely available, employers should remain diligent in enforcing the traditional methods of screening (e.g. temperature checks, self-monitoring, etc.) and employ testing whenever possible and in a manner likely to produce the most meaningful results.

The EEOC still has not clarified what it means to “consider” the incidence of false-positives and false-negatives associated with a COVID-19 test. Although the EEOC’s guidance counsels employers to consider false-positives and false-negatives, it offers very little in the way of practical application of this suggested “consideration.” Does that mean tests should be administered multiple times? Does it mean that some approved tests should be used in favor of other approved tests?

Considerations for Adopting a Sound Testing Protocol:
Given the variety of business environments, there is no “one-size-fits-all” approach to testing, and employers should adopt protocols that address their specific kinds of workplaces. Regardless the following considerations should form the basis of a sound testing protocol:

  • Testing for COVID-19 must be conducted on a nondiscriminatory basis, meaning that any testing protocol should be applied equally to all employees.
  • Any screening, testing, or inquiry that is broader than necessary to address the potential direct threat should be prohibited. Accordingly, employers should resist any urge to expand testing or screening beyond ascertaining the presence of COVID-19 through a diagnostics test, including being cautious about administering the antibody test given the present lack of clarity as to whether such tests are permitted.
  • It is possible that certain employees with a medical condition may request an accommodation, such as making available an alternative testing method.
  • Employers should consider how any requests to be excused from testing based on faith-based arguments will be handled. For example, an employee’s religious beliefs may prevent them from providing a blood sample for a test. In response, an employer should be prepared to seek alternative testing methods, such as through saliva or swabs.
  • Thoughtfully consider where and how testing will be conducted. If onsite, consider how to mandate maintain social distancing for employees waiting to be tested; provide PPE for persons conducting testing; and exit strategies from the physical workplace for persons who test positive.
  • Consider visitor and vendor screening if such third parties will be needed onsite to support the regular workforce’s return to the workplace.
  • Any testing protocol should be prepared to handle (consistently) an employee’s refusal to submit to testing.
  • Recognize that there may be an obligation under wage and hour laws to pay employees for time spent waiting to be tested, as well as time spent waiting for the results of the test, assuming the employee will not be admitted to the workplace until the employer has received testing results.
  • Require employees to consent in writing to the screening, and to a COVID-19 return to work policy that addresses testing.

Frequently Asked Questions When Taking Employee Temperatures as a COVID-19 Precaution in the United States
As retail, food service, and other industries continue to adapt to the ever-changing business environment, employers are implementing new screening programs to help ensure the safety of their workforce and customers during the COVID-19 crisis. Indeed, some form of employee screening is becoming mandatory in a number of cities and counties around the country.

Faced with the current outbreak, many employers—particularly those in food service or other customer-facing retail operations—are considering taking the temperatures of their employees before the employees are allowed to begin work. This bulletin seeks to answer some of the questions that employers, particularly retailers, might have when implementing such programs during the COVID-19 crisis. Note that the guidance is based on the current global pandemic and state of emergency related to COVID-19, and much of this guidance would not apply outside of that context.

1. Is it even legal to take an employee’s temperature, and to instruct employees to stay home if they have symptoms associated with COVID-19?
We covered this in our March 18, 2020 Bulletin, but, generally, the short answer is, “Yes, and Yes.” The Equal Employment Opportunity Commission recently clarified that in light of the current COVID-19 pandemic, employers may measure their employees’ body temperatures. The EEOC also says that employees with symptoms associated with COVID-19, including a fever, may be sent home from work.

2. Do any states require employers to take their employees’ temperatures?
Some states, Kentucky as an example, are now requiring businesses to conduct temperature checks for their employees. Others are encouraging employers to take the temperatures of their employees.

In addition, some cities and counties have issued orders that impose certain obligations on employers to implement a temperature check system. For instance, Tift County, Georgia, instructs employers to “make every effort to take the employee’s temperature and record the same.” Likewise, an order in Dallas County, Texas, instructs employers “to the greatest extent possible and when equipment becomes available” to take the temperatures of their employees. We expect other cities and counties to follow suit, particularly as part of the phase-in approach for business reopening plans.

3. If I want to take my employees’ temperatures, where do I begin?
Employees should be given notice that the company will be implementing a temperature-taking program. This can be done via an email to all employees or posting a notice inside the facility. The notice should say something to the effect of, “To ensure the safety of all of our employees and customers, starting on [DATE], we will begin to take the temperatures of all persons entering our facility. This will be done through a no-touch infrared scanner thermometer. Per the CDC guidelines, if your reading is 100.4 or above, we will not be allowing entry to our facility. We will provide instructions to you on next steps at that time.” By providing notice, you avoid surprising your employees and give them an opportunity to raise any concerns that they may have. Further, some jurisdictions require employers to provide such a notice in order to comply with state privacy laws.

4. I don’t have an infrared scanning thermometer. Will a minimal touch forehead thermometer work?
There is currently no guidance from the Centers for Disease Control and Prevention as to the type of thermometer that an employer should use when taking its employees’ temperatures. The CDC says only, “Employers should measure the employee’s temperature and assess symptoms prior to them [sic] starting work.” Although minimal contact forehead thermometers may work, touchless infrared scanning thermometers are relatively inexpensive and preferred. No matter what type of thermometer is used, the individual conducting the screening should follow the manufacturer’s sanitization protocol between uses and should be trained on its use so that the results can be comfortably relied upon.

There is no need to conduct multiple tests of the same employee or otherwise question the results of the thermometer so long as the individual conducting the test understands what he or she is doing.

5. Who should conduct the screening?
Ideally a qualified third party would perform this screening, but, where not possible or practicable, we recommend the temperature checks be administered by management personnel or, if possible based on the device being used, self-administered.

6. Besides a thermometer, what else do I need in order to conduct the screening?
You will need to obtain hand sanitizer and personal protective equipment for the individual performing the screening. Such PPE may include disposable gloves, masks, and any other supplies needed to sanitize or operate the thermometer according to the manufacturer’s specifications. Employees being checked should also wear masks if available.

7. Where do I conduct the temperature checks?
You should make every effort to perform the testing before employees access the main areas of the facility. Ideally, the location would offer the individuals some privacy so that others (colleagues or customers) would not be able to observe or hear the results of the temperature check. The location should, if possible, allow individuals to remain six feet apart from one another. If your facility is relatively small, consider staggering start times to minimize the chance that lines will form and employees will congregate in a confined area.

8. At what temperature should an employee be sent home?
The CDC currently recommends that if an individual has a temperature of 100.4 degrees or higher, he or she should not leave the home (and therefore should be sent home after the test). Dallas County requires that a worker with a temperature above 99.6 degrees be sent home. Unless your jurisdiction instructs otherwise, defaulting to the CDC recommendation is advised. Note, however, that a fever does not mean that an individual has COVID-19, and the absence of a fever does not mean a person does NOT have COVID-19. As such, you should make sure employees don’t relax other good practices, such as proper and frequent handwashing, social distancing, etc., in reliance on temperature checks.

9. What records should I maintain and who should have access to them?
Generally, unless your jurisdiction requires it, you are under no obligation to maintain a record of employee temperatures or even document that temperature checks were performed. If you do choose to record and maintain the data, you will need to do that in a way that complies with the confidentiality requirements of the Americans with Disabilities Act, and confidentiality and privacy considerations under applicable state and local laws. In addition, if the temperature checks are performed by a physician, nurse, or other health care personnel or technician, OSHA record-keeping requirements may be triggered.

10. What should I do if an employee’s temperature registers at or above 100.4 degrees (or the established CDC threshold)?
The employee should be sent home for the day, at least, and your policies or local requirements may require you to exclude individuals with COVID-19 symptoms for longer. The employer has discretion to determine whether to require that the employee provide a doctor’s note before returning to work, but, again, you should have a policy that you consistently follow and ensure your policy is consistent with any federal, state or local requirements.

11. What if an employee refuses to have his or her temperature taken?
If you are unable to reach a satisfactory resolution with the employee, you should send him or her home if your policy or practice is that all employees must be tested prior to starting a shift.

12. Can I ask the employee about other symptoms?
Yes. In fact, some jurisdictions are requiring that employers “screen” employees by asking about their symptoms, recent travel, and/or whether the individual has been exposed to COVID-19.

13. If an employee informs me that he or she has been exposed to COVID-19, am I required to send that person home?
That depends. Presently, the CDC advises that critical infrastructure workers may be permitted to continue work following potential exposure to COVID-19, provided that they remain asymptomatic and that additional precautions are implemented to protect them and the community. That being said, different states and localities may, depending upon the circumstances, require the individual to self-quarantine for 14 days or more following exposure, and employers may adopt, and many are adopting, quarantine requirements, consistent with general obligations to provide a clean and safe work environment for all employees. We would also recommend not requiring an individual to work if a health care provider or governmental agency has instructed the individual to quarantine, as is true in many instances when an individual has been in close contact with a confirmed COVID-19 case.

14. Must I compensate my employees who administer the tests, or for employees’ time spent being screened?
Based on the Fair Labor Standards Act, we recommend compensating employees who are not FLSA-exempt at their normal hourly rate for time spent administering the testing, as that is time spent performing an assigned task for the benefit of the employer. Of course, if the employee administering the temperature check is an exempt manager, then the time would be compensated by the manager’s regular salary. The compensability of the time spent by the employee having his or her temperature taken is a more difficult issue, and arguments can be made both ways as to whether this time must be compensated. The conservative approach would be to treat the time as compensable; however, an employer with a greater risk tolerance could take the position that the time it takes to have your temperature taken is not compensable, or if it is, the amount of time involved is so small as to be de minimis. Ultimately, this is a decision each employer must make based on its own facts and circumstances and risk tolerance.

Further, you should also consider whether any “call-in” or “reporting pay” laws or predictive scheduling laws are applicable in the jurisdictions where you are operating, including whether those laws require any compensation in this situation. The same is true for more restrictive state minimum wage laws that may define “hours worked” more aggressively.

15. Can I require employees to take their own temperatures before coming to work?
So long as your jurisdiction does not require otherwise, employers may ask employees to take their own temperature before reporting to work. This may be an option for those businesses that lack the physical space, personnel, or equipment to conduct on-site temperature taking; however, we should note that availability of equipment for employees may also be a barrier for some employees, which may affect the overall consistency and effectiveness of this approach. Employers should adhere to the concepts outlined above if they decide to collect or document employee self-temperature checks that are performed at the employee’s home.

16. How long should I plan to be taking employee temperatures?
No one knows precisely how long the pandemic will last. Further complicating matters is the fact that some states and localities continue to be “hot spots” while evidence suggests that others might be moving on from the worst the virus has to offer.

As certain states begin to reopen, most are adopting a phased approach as they relax the restrictions imposed upon businesses. Employers should follow the guidance of the state or county where their stores and employees are located. Attention should also be focused on changing guidance from the EEOC. Although the EEOC has clearly stated that the taking of employee temperatures is a permissible response to the current global pandemic, at some point in the future the EEOC may change course on this guidance based on the continued evolution of the pandemic. Outside the context of a pandemic, employers are generally limited to conducting medical inquiries and exams that are job-related and consistent with business necessity.

Is Continuous Screening The Key To A Complete Return-To-Work Safety Plan Amid COVID-19?

With companies across the nation beginning the precarious process of re-opening amid the COVID-19 pandemic, everyone is wondering what needs to be done to get employees back to work safely. It is easy to focus only on the health risks, which may be mitigated with a solid testing program, but employers who want to design a comprehensive plan will need to consider the role of background screening as well.

Here’s why: In the past two months, we have seen massive court closures and stay-at-home orders. During that time, crime has continued and, in some cases, increased, as is the case with domestic violence. Employers must now not only struggle with health concerns, but also with what their employees have been doing during their time away. And there’s a dilemma: crime continued, arrests continued, but unfortunately, trials did not. Court houses closed, meaning trials were postponed. This means no results when and if you were to run a background check on your employees for infractions that occurred during the pandemic.

So, what can you do to protect your workforce and ensure your company policies are being enforced? You can’t always rely on the employee to volunteer information about their arrest to your HR department. The answer potentially lies in continuous background screening. Adding an ongoing monitoring program will enable you to keep up-to-date on criminal records, once cases are decided and records begin to populate again. This provides a clear line of sight, without human intervention, to incidents as they are recorded in the courts, allowing your HR team to make more informed hiring decisions.

Continuous screening can include criminal convictions (felonies and misdemeanors), global sanctions, and entry onto various watch lists, sex offender registries, and more. The best part? With the right provider, continuous background screening is cost effective and quick to engage. Plus, in addition to workplace safety benefits, it could help your company save money by avoiding costly negligent hiring litigation.

If you are interested in developing a solid COVID-19 return-to-work safety plan, ask your background screening provider about adding ongoing monitoring to your program. ClearStar offers a comprehensive solution, with antibody/diagnostic testing and ongoing monitoring, along with a virtual badge that can be issued based on the results of either. This is for the record.

For The Public Record is a monthly blog featuring thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process. Click here to subscribe.

Pre-Employment Screening and Onboarding Workers During the COVID-19 Emergency

While the health and wellbeing of employees is certainly top of mind for human resources teams due to the COVID-19 nationwide emergency, questions linger about many aspects of hiring and workforce management. The Department of Labor Occupational Safety and Health Administration has issued quite a few guidelines for social distancing, teleworking, and maintaining a healthy workforce during this time, but what does HR need to know specifically about pre-employment screening and onboarding protocols?


What to Know About Pre-Employment Screening During COVID-19


Employers must continue to adhere to the guidelines of the Americans with Disabilities Act but, during a pandemic, the Equal Employment Opportunity Commission provides updated information about ADA applications. The Pandemic Preparedness in the Workplace and the Americans with Disabilities Act publication has been updated to clarify some common questions related to COVID-19.


  • Job applicants may be screened for COVID-19 after a conditional job offer is made and as long as all new hires for the same type of job are also screened. Disability status is not a factor for this type of medical screening.
  • Temperature taking is considered an acceptable part of a pre-employment medical screening but, as with all pre-employment medical screenings, it is permitted as part of a post-offer exam only.
  • Employers may delay an applicant’s start date if they have COVID-19 or its symptoms.
  • Employers may withdraw a job offer if an applicant needs to start immediately but has tested positive for COVID-19.
  • Employers may not postpone a start date or withdraw a job offer if an applicant is in a high-risk category for COVID-19 complications. Although, applicants in these categories can choose to accept accommodations like a later start date or a teleworking option.


Additional details about these and other guidelines are included in the Pandemic Preparedness in the Workplace publication. Follow the link for information and additional resources related to hiring and workforce management during COVID-19.


What to Know About Onboarding New Hires Remotely During COVID-19


Office closures and social distancing have had a direct effect on the identity verification of new employees. Fortunately, some temporary accommodations have been made for remote hiring and deadline extensions.


  • Form I-9 typically requires an in-person inspection of documents, but the Department of Homeland Security has waived that requirement temporarily. DHS suggests viewing the documents via video conference, fax, email, etc. before obtaining copies and completing Section 2. Once normal business operations resume, though, there must be a physical inspection of the same documents and additional information added to the form. Visit for more details about this temporary change to Form I-9 requirements. E-Verify has also issued a temporary policy on expired List B identity documents.
  • E-Verify has extended the time allowed to take action for resolution of Tentative Nonconfirmations (TNCs) that will be delayed due to government office closures. Employers are still required to create a case in E-Verify within three business days from the employee’s date of hire. To claim the delay, select “Other” from the dropdown list and enter “COVID-19” as the reason. Additional info about delayed action for resolution of TNCs is available at


 In Sickness and Health, We’re Here to Help


Ask ClearStar how our tech solutions can help your HR team manage and expedite new hire identification verifications, background checks, and medical screenings throughout this complicated time and far into the future.

CBD, THC, and DOT Policy Changes

The availability­–and use–of cannabis and cannabis-derived products has become more ubiquitous than poppy seed muffins, leading to a lot of uncertainties for businesses and their employees. And while positive drug screen results after eating the aforementioned muffin was a bit more urban myth than real concern, testing positive for marijuana after using cannabis-derived products has become a real and complicated concern.


How are THC, CBD, Hemp, Cannabis, and Marijuana-Related?


For those who aren’t up to speed on the current state of cannabis products and terminology, what’s the difference between them all and why does the terminology matter?


The origin of THC, CBD, hemp, and marijuana products is Cannabis, a plant with a variety of species that are cultivated for thousands of uses. Cannabis derivatives are broken down into


  • Tetrahydrocannabinol (THC) – a psychoactive chemical compound found in the Cannabis plant.
  • CBD–or Cannabidiol–a non-psychoactive chemical compound found in the Cannabis plant.
  • Hemp – a general term for the sterilized seeds, stems, stalks, and roots of a Cannabis plant with a THC level of less than 0.3%. Hemp is typically used to make textiles, food products, and other consumer goods.
  • Marijuana – the viable seeds, leaves, and flowers of a Cannabis plant with a THC level of more than 0.3%. Marijuana serves as a mind-altering substance when it is smoked, vaped, or ingested.


CBD and Safety-Sensitive Employees


Unlike THC, which binds to brain receptors creating a “high,” CBD binds to brain receptors creating a feeling of well-being, easing physical pain, and, in some cases, treating medical conditions like childhood epilepsy. There’s still a lot of research being done into the medicinal uses of THC and CBD, but the FDA has approved of its use for a variety of reasons. This is where employer concerns have arisen.


The US Department of Transportation recently updated its policy on drug and alcohol compliance and removed hemp from its definition of marijuana. This change in policy directly affects safety-sensitive employees who are subject to drug testing–pilots, school bus drivers, truck drivers, train engineers, transit vehicle operators, aircraft maintenance personnel, fire-armed transit security personnel, ship captains, pipeline emergency response personnel, and others.


In a nutshell, the above employees may use hemp-derived products like CBD without legal ramifications but, should a drug test confirm THC levels of more than 0.3% in the bloodstream, medical use cannot be claimed as a legitimate explanation. Because there is currently no FDA oversight of THC levels in CBD products, safety-sensitive employees who use CBD products are responsible for monitoring their own intoxication levels regardless of the claims on a CBD product label (which are sometimes above legal limits).


Drug Screening for Your Safety-Sensitive Employees

Trustworthy and efficient drug screening tools and support are available for pre-employment screening and/or ongoing monitoring through ClearStar. Explore our exceptional candidate care, mobile apps, and services for local, national, and international teams. Ask ClearStar to streamline your drug screening protocols today.

What Info is Included in a Background Check?

Background checks can include a lot of information about a job candidate. They’re no longer just about criminal histories and resume verifications. The information that can potentially be revealed by a background check can vary according to job requirements, industry regulations, location of the employer, etc. A couple of areas of concern for many candidates are drug screens and social media.


What Does a Drug Screen Include?


Drug screens can be cursory or somewhat in-depth, depending on applicable laws and the needs of the employer. For the purposes of a pre-employment drug screen or drug test, employers are generally looking for proof of illegal drug use or use of alcohol or other legal substances to an extent that it may diminish a job candidate’s abilities to perform the duties of a job.


As laws loosen restrictions on recreational marijuana use and medical marijuana prescriptions become more common, drug screening is getting more complicated for both job candidates and employers. It’s particularly hazy as there is no accurate measurement for marijuana levels in the bloodstream. In a recent Drug Screening 101 webinar, ClearStar’s Executive Vice President of Medical Information Services provides more details about our drug screening processes, terminology, and myths.


Do Background Checks Include Social Media?


Yes, they can! A background check of internet behavior and social media use must be performed with care by a neutral party who can properly assess an area that offers overwhelming opportunities for misunderstandings and discrimination. A lot of social media activity is benign, but we all know it can ruffle feathers.


Unfortunately, “ruffled feathers” isn’t reason enough to pass on a qualified job candidate. When ClearStar performs social media screenings, we make our findings actionable by reporting back only behavior that presents a legal foundation for concern. Examples of racism, illegal activity, violence, and sharing of sexually explicit material will be included in our reports.


How to Get Background Checks Right


Changing laws, industry regulations, medical allowances, and privacy issues are more than enough to cause concern for employers who are just looking to hire the best candidates from their applicant pools.


ClearStar has all the tools and trained staff to help your HR team feel certain that every applicant is on a legally compliant and level playing field when it comes time for background checks. Plus, our unique attention to candidate care gives your potential hires added confidence in your company. Ask ClearStar about what kinds of background checks we can provide for your needs.

April 2020 Screening Compliance Update

Federal Developments

DOT and FMCSA Guidance for Managing Disruptions to Regulated Drug and Alcohol Testing Due to COVID-19
On March 23, the Department of Transportation (“DOT”) issued guidance for conducting DOT-required drug and alcohol testing in safety-sensitive transportation fields (aviation, trucking, mass transit, railroads) in light of concerns that disruptions caused by COVID-19 were interfering with, and even preventing, compliance with testing requirements. The next day, the Federal Motor Carrier Safety Administration (“FMCSA”) issued its own guidance, effective through June 30, 2020, clarifying how motor carriers and employees should manage any disruptions to testing. The FMCSA offers the following guidance for motor carriers unable to conduct required testing due to the unavailability of program resources (collection sites, breath alcohol technicians, medical review officers, etc.), COVID-19-related supply shortages, facility closures, state or local government quarantine, stay-at-home, or social distancing requirements, and other impediments:

  1. Random testing: 49 C.F.R. § 382.305(k) requires motor carriers to ensure that dates for random alcohol and drug tests are spread reasonably throughout the calendar year. Random testing must be performed at rates of 50% (drug) and 10% (alcohol). The FMCSA suggests it be done quarterly. If COVID-19-related disruptions prevent a motor carrier from performing random selections and tests sufficient to meet the 50%/10% rate, the carrier should: (1) make up the tests by the end of the year; and (2) document in writing the reasons why tests could not be performed and the actions taken to locate alternative collection sites or other testing resources.
  2. Pre-employment testing: Unless the exception in 49 C.F.R. § 382.301(b) applies (participation in a prior testing program within the previous 30 days), a motor carrier that is unable to conduct a pre-employment drug test in accordance with 49 C.F.R. § 382.301(a) cannot allow the subject prospective employee to perform any DOT safety-sensitive functions until a negative pre-work test result is received.
  3. Post-accident testing: 49 C.F.R. § 382.303 requires motor carriers to test each accident-involved driver for drugs and alcohol as soon as practicable following an accident. If due to COVID-19-related disruptions a motor carrier cannot administer an alcohol test within 8 hours, or a drug test within 32 hours, the motor carrier must document in writing the specific reasons why the test could not be conducted.
  4. Reasonable suspicion testing: Under 49 C.F.R. § 382.307, motor carriers who reasonably suspect that a driver has violated drug or alcohol prohibitions must require that driver to submit to testing. In addition to documenting the contemporaneous observations that led to the test (i.e., the driver’s appearance, behavior, speech, or odors), a motor carrier who is unable to obtain testing should document the specific reasons why testing could not be obtained (including efforts made to find alternative collection sites) and follow the rules in Section 382.307(e).
  5. Return-to-duty testing after drug/alcohol treatment: In accordance with 49 C.F.R. § 40.305(a), motor carriers must not allow a driver to perform safety-sensitive functions until return-to-duty testing is conducted and a negative result is obtained.Follow-up testing after return-to-duty process: If testing cannot be completed, the motor carrier should: (1) document why testing could not be completed in accordance with the testing plan, including efforts made to mitigate the effect of any COVID-19-related disruption; and (2) conduct the test as soon as practicable.

The FMCSA encourages motor carriers and employers to respond to employee concerns regarding the safety of obtaining drug and alcohol testing in the current environment in a sensitive and respectful way. The responsibility for evaluating the circumstances of what constitutes an employee’s refusal to test, and to determine whether the employee’s actions or stated objections should be considered a refusal to test under 49 C.F.R. § 40.355(i), belongs to the motor carrier.

DOL Publishes Additional FAQs, Making Clear That Employees on Furlough or Layoff Are Not Eligible for FFCRA Paid Sick Leave or Expanded FMLA
The Department of Labor issued additional FAQs on Thursday March 26. They now offer 37 FAQs on how the paid sick leave and expanded FMLA leave under the Families First Coronavirus Response Act will apply. The leave obligations begin April 1, 2020. As more and more employers are required to shutdown due to state orders or layoff employees due to business concerns, a frequently asked question is whether the employees impacted by these closures and layoffs will still be eligible for paid sick leave and paid FMLA leave under the FFCRA. According to the FAQs issued by the DOL, they will not:

24. If my employer closes my worksite on or after April 1, 2020 (the effective date of the FFCRA), but before I go out on leave, can I still get paid sick leave and/or expanded family and medical leave?
No. If your employer closes after the FFCRA’s effective date (even if you requested leave prior to the closure), you will not get paid sick leave or expanded family and medical leave but you may be eligible for unemployment insurance benefits. This is true whether your employer closes your worksite for lack of business or because it was required to close pursuant to a Federal, State or local directive. You should contact your State workforce agency or State unemployment insurance office for specific questions about your eligibility. ***

26. If my employer is open, but furloughs me on or after April 1, 2020 (the effective date of the FFCRA), can I receive paid sick leave or expanded family and medical leave?
No. If your employer furloughs you because it does not have enough work or business for you, you are not entitled to then take paid sick leave or expanded family and medical leave. However, you may be eligible for unemployment insurance benefits. You should contact your State workforce agency or State unemployment insurance office for specific questions about your eligibility.

For additional information, please refer to In addition to several FAQs on the impact of layoffs and furloughs, the FAQs also address what documentation employers should request, whether the paid sick leave and paid FMLA can be used intermittently and whether other employer-offered paid leave can be used concurrently with that required by FFCRA.

CFPB Issues Credit Reporting Guidance During COVID-19 Pandemic
On April 1, the Consumer Financial Protection Bureau (CFPB) issued a policy statement addressing credit reporting issues faced by consumers and credit furnishers in light of the COVID-19 pandemic. The purpose of the policy statement is to highlight furnishers’ responsibilities under the recently enacted CARES Act and inform consumer reporting agencies and furnishers of the Bureau’s flexible supervisory and enforcement approach regarding compliance with the Fair Credit Reporting Act (FCRA) and Regulation V. A separate alert on the provisions of the CARES Act amending FCRA is available here. The CFPB notes this policy statement is not a formal, binding rule-making but instead is a non-binding general statement of policy articulating considerations relevant to the Bureau’s exercise of its supervisory and enforcement authorities. The CFPB acknowledges in the policy statement that flexibility is necessary given the impact of the pandemic on the more than 10,000 credit furnishers in the United States. The Bureau notes that while credit furnishing is not legally required, the CFPB encourages furnishers to continue furnishing information to the credit reporting agencies. The CFPB also reiterates prior guidance encouraging financial institutions to work constructively with borrowers during the crisis. A separate alert addressing that guidance is available here.
In the Policy Statement, the Bureau sets forth specific circumstances in which it intends to be flexible:

  • While the CFPB expects furnishers to comply with the CARES Act’s amendments to FCRA regarding not reporting as delinquent virus-related accommodations to borrowers, if furnishers make other, voluntary payment accommodations, the CFPB does not intend to cite in examinations or take enforcement actions if the furnished reports accurately reflect the payment relief measures taken by the furnisher.
  • Although FCRA requires consumer reporting agencies and furnishers to investigate disputes within 30 to 45 days from receipt of the dispute, the CFPB will consider individual circumstances when evaluating compliance with these timeframes given difficulties furnishers may face in completing timely investigations. The CFPB does not intend to cite in examinations or take enforcement actions against consumer reporting agencies or furnishers that exceed the required timeframe to investigate disputes, but who do make good faith efforts to investigate disputes as quickly as possible.
  • Furnishers and consumer reporting agencies may avail themselves of statutory and regulatory provisions eliminating the obligation to investigate disputes submitted by credit repair organizations and disputes they reasonably determine to be frivolous or irrelevant. The CFPB will consider constraints to resources caused by the pandemic in assessing if such a determination is reasonable.

FTC Guidance on AI: Don’t Surprise Consumers – Or Yourself
FTC Bureau of Consumer Protection Director Andrew Smith this week published some helpful pointers for companies that are developing or using AI to support consumer-facing services. These pointers are drawn from past FTC enforcement actions, reports, and workshops. They boil down to one overarching message: Companies shouldn’t surprise consumers – or themselves – in how they develop or use AI.

Taking care with AI can bring benefits beyond helping to avoid FTC scrutiny. It can also help avoid frayed relationships with consumers and business partners. In addition, paying attention to AI now may leave companies better prepared to deal with future regulations, such as the profiling and automated decision-making provisions of the California Privacy Rights Act ballot initiative, aka CCPA 2.0.

Director Smith’s recommendations fall under four main categories:

  • Be transparent;
  • Explain your decision to the consumer;
  • Ensure that your decisions are fair; and
  • Ensure that your data and models are robust and empirically sound.

Although many of these messages relate to sector-specific laws that the FTC enforces, such as the Fair Credit Reporting Act (FCRA) and Equal Credit Opportunity Act (ECOA), they have broader applicability. This post takes a closer look at some of the wider implications of the FTC’s AI guidance.

Keep an Eye on Sectoral Privacy Lines. Long-established laws such as the FCRA, ECOA, and Title VII of the Civil Rights Act of 1964 apply to uses of AI in the areas of consumer reporting; consumer credit; and voting, education, and the offering of public accommodations, respectively. Meeting the obligations of these laws depends on recognizing whether and when they apply. However, the laws discussed in the FTC’s blog post are far from exhaustive. One important law to add to those flagged in the blog post: HIPAA. Although it is usually clear when an entity is acting as a healthcare provider, insurer, or clearinghouse, it may be more challenging to determine when a company becomes a “business associate” of a covered entity. The response to COVID-19 has accelerated the race to develop health-related AI applications, which makes it more urgent for companies to recognize when they are acting as business associates and to understand their responsibilities under HIPAA.

Comprehensively Evaluate Data and AI Models. According to the blog post, the FTC has developed legal and economic criteria for evaluating the presence of illegal discrimination in AI systems – at least in the ECOA context. Specifically, the agency will look at inputs to determine whether they include “ethnically-based factors, or proxies for such factors, such as census tract” as well as outcomes, “such as the price consumers pay for credit, to determine whether a model appears to have a disparate impact on people in a protected class.”

The post strongly suggests that the FTC’s attention to potential discrimination through uses of AI is not so limited: “Companies using AI and algorithmic tools should consider whether they should engage in self-testing of AI outcomes, to manage the consumer protection risks inherent in such models” (emphasis added). The FTC, however, does not offer a framework for these evaluations, nor has it indicated more generally what kinds of AI discrimination risks might be actionable under Section 5. Still, making good-faith efforts to identify and mitigate such risks could help companies to stay ahead of the enforcement curve.

Conduct Due Diligence on Vendors, and Constrain Downstream Users. A another theme that runs throughout the FTC’s AI guidance (as well as its privacy, data security, telemarketing, and other areas of FTC consumer protection policy): companies should carefully assess how upstream providers of AI-related data and analytics comply with their legal obligations, and they should impose appropriate constraints to prevent their own customers from using AI services in inappropriate or illegal ways. Although the FTC focuses on upstream and downstream requirements under FCRA and ECOA, these considerations are equally important when Section 5 is the main consideration and staying out of more highly regulated activities is the intent. Conducting due diligence before entering into an AI-related business relationship, requiring contract terms that spell out permissible uses of AI systems and data inputs, and monitoring the performance of business partners are all critical to achieving these ends.


State Developments

Equal Pay Day 2020: Seyfarth’s Release of Equal Pay Resources
Equal Pay Day is always a day of deep reflection and connection for our Pay Equity Group. The day is filled with webinars, phone calls and interviews, flights, in-person meetings and hallway greetings. This year, instead of flying around the country, we are working from homes, preparing final materials in make-shift home offices between “homeschooling” sessions. At least one of our planning calls was interrupted by a new “co-worker” roller-skating down the hallway. But putting the final touches on our communications in the quiet of the morning, we reflect on the way the global pandemic has had a way of clarifying and crystalizing the core of what is important. As Kori Carew, Seyfarth’s Chief Inclusion & Diversity Officer, wisely stated that “Our need for connection and belonging likely hasn’t been greater for most of our lifetimes.” So even though we have made the decision to move our webinar until later in the year, we wanted to share these reference materials. We are grateful that we can support the efforts of so many employers who are proactively working to ensure equal pay on a daily basis. As we offer these resources to you today, we plan to hold a substantive webinar in the summer when we can collectively focus on the legal issues, trends and practices that propel our combined work and focus on ensuring equal pay for all. As we are looking back at 2019 and forward to the new world that 2020 and beyond presents, we see three key trends:

The Continued Passage of Pay Laws: Since the beginning of 2019, we saw new pay laws enacted or strengthened in eleven states. Alabama, which was one of only two states without any state pay equity laws, passed an equal pay law and also enacted a quasi-salary history ban. Colorado passed a law that will require employers, beginning in January 2021 to include the pay scale on job postings. Nebraska passed a wage transparency law. There are new or amended salary history bans in Illinois, Maine, New Jersey, New York, and Washington state. There are also new equal pay laws or increased penalties for violations of equal pay laws in Illinois, Maryland, Nevada, New York, and Wyoming. The Fourth Annual 50-State Pay Equity Desktop Reference outlines many of these changes at the state-level.

  • Increased Pay Litigation: Over the years, we have seen an increase in litigation under the federal Equal Pay Act and analogous state laws with noticeable focus on state law claims. With over 300 pure “pay” cases filed in the last two years, we see a concentration of cases in California, Florida, and Texas. Those cases are already generating new and intriguing legal issues that have the potential to reshape the landscape of pay equity litigation, including whether and how those claims can be maintained as collective or class actions. The 2020 edition of the Developments in Pay Litigation Report, authored by our colleague Matt Gagnon, outlines these cases and trends.
  • A Global Focus on Pay Equity: In 2019, we saw employers continue to focus on global pay equity issues, to be more transparent about pay along with an increased appetite for additional data and metrics. As our global workforces are impacted by COVID-19, we believe that the desire to connect, to demonstrate belonging will be even more important in 2020.

Oakland County, Michigan Orders Employers of Critical Infrastructure Workers and Essential Employees to Implement Screening and Social Distancing Measures
Under Michigan’s Stay Home, Stay Safe Executive Order effective March 24, 2020, only essential businesses or operations that employ critical infrastructure workers are allowed to continue in-person operations.1 The Order, which remains in effect until April 13, 2020, also allows non-essential businesses to designate employees as essential if their in-person presence is “strictly necessary” to maintain the value of inventory and equipment, to care for animals, to ensure security, to process transactions, or to help other employees work remotely.

On March 25, 2020, the Oakland County Health Division issued an amended emergency order requiring employers of critical infrastructure workers at open businesses and operations, and employers of employees designated as essential for carrying out minimum business operations, to develop and implement a daily screening program for all such employees.2 The screening criteria must include these questions:

  1. Whether the employee has had a fever, cough, shortness of breath, sore throat, or diarrhea. If a touchless thermometer is available, a temperature check is “strongly recommended” in lieu asking the employee if they have had a fever.
  2. Whether the employee has had any close contact in the previous 14 days with someone diagnosed with COVID-19.
  3. Whether the employee has travelled outside of Michigan in the previous 14 days.

If the employee responds “yes” to question 1, the employer must exclude the employee from work until the employee has had no fever for at least 72 hours AND their other symptoms have improved AND at least 7 days have passed since their symptoms first appeared. If the employee responds “yes” to question 2, the employer must exclude the employee from work until 14 days after the close contact. If the employee responds “yes” to question 3, the employer must exclude the employee from work until 14 days after the travel unless the travel was associated with the employee commuting between their home outside of Michigan and their place of employment in Michigan. The Health Division has created a Staff Screening Checklist for Businesses to help employers comply with the Emergency Order. Exempted from the Order are healthcare organizations with an infection control program in place.

The Emergency Order, which remains in effect until April 13, 2020, also requires employers of critical infrastructure workers at open businesses and operations, and employers of employees designated as essential for conducting minimum business operations, to develop and implement a plan to maintain social distancing of at least six feet between employees working alongside each other and customers waiting in lines inside or outside of the business. Where necessary to meet this requirement, employers must limit the number of employees and customers allowed inside their facilities at any one time, use visual markings and signage, limit the number of entrances, and establish specialized hours. Employers are also required to post the Executive Order at each entrance and publish the order to “members of the public at large by all reasonable means available.” The Order offers no guidance on how employers can comply with the latter requirement if they are not a public entity with the ability to send an email, alert, or some other form of electronic communication to the general public.

The California Department of Fair Employment and Housing Issues COVID-19 Guidance
As California cases of COVID-19 began to rise in early March, several California administrative agencies released information on COVID-19 employment issues, such as administration of paid sick leave, disability benefits, and unemployment insurance. Yet, the Department of Fair Employment and Housing (DFEH)—the agency charged with enforcement of California’s Fair Employment and Housing Act (FEHA), which, among other things, prohibits discrimination, harassment, and retaliation in the workplace—remained silent. Earlier this week, the DFEH released its own guidance in response to the COVID-19 pandemic. The DFEH’s guidance, styled in the form of Frequently Asked Questions, answers many questions that have arisen as COVID-19 workplace concerns have become ubiquitous, including whether employers may take employees’ temperatures, how much information an employer may reveal about employees who come in contact with the virus, how much employers may ask about an employee’s absence from work, and whether employers may require employees to wear personal protective equipment. The DFEH’s guidance confirms that an employee may use leave under the California Family Rights Act (CFRA) if the employee is ill with COVID-19 or is caring for a family member with COVID-19. The guidance also discusses whether employers should require medical documentation for leaves and accommodations for COVID-19 related disabilities given practical limitations on employees’ abilities to obtain medical documentation. Most of the DFEH’s guidance mirrors guidance previously issued by federal agencies. The U.S. Equal Employment Opportunity Commission (EEOC) previously released its own guidance for COVID-19 response in the workplace, including whether employers could perform employee temperature checks and how much information an employer could request from employees calling in sick. However, because the EEOC only administers federal law, before the DFEH issued its guidance, it was unclear whether the same direction would apply under California’s stricter FEHA.

Indiana Revises Law on Employment of Minors
The Indiana General Assembly has enacted changes in how and when minors are allowed to work in the state. The new provisions go into effect April 1, 2020.

A minor who is at least 14 years old and younger than 16 (14- and 15-year old employees) could not work before 7:00 a.m. or after 7:00 p.m. on a day that precedes a school day or after 10:00 p.m. on a day that does not precede a school day. In other words, a 14- or 15-year-old employee could not start work before 7:00 a.m. and could work only until 7:00 p.m., except for Friday and Saturday nights, when they could may work until 10:00 p.m.

Employees who are 16 years old could not work more than 8 hours per day, more than 30 hours per week, or more than 6 days per week. However, if the child’s parent gave written permission, the employee could work up to 40 hours during a school week, up to 9 hours per day, and 48 hours per week in a non-school week. These employees also could not begin any workday before 6:00 a.m., and they could work until 11:00 p.m. on a night that preceded a school day as long as the child’s parent gave written permission.

Employees who are 17 years old could not work for more than 8 hours per day, more than 30 hours per week, or more than 6 days per week. However, if the child’s parent gave written permission, the employee could work up to 40 hours during a school week, up to 9 hours per day, and 48 hours per week in a non-school week. These employees also could not start work before 6:00 a.m. if it was a school day. They were also permitted to work until 11:30 p.m. on nights that preceded a school day or until 1:00 a.m. with written permission from the minor’s parent.

With the goal of simplifying these rules, the Indiana General Assembly has amended the law to provide that employees aged 14 and 15 may not work before 7:00 a.m. or after 7:00 p.m. From June 1 through Labor Day, these employees may work as late as 9:00 p.m., except on a day that precedes a school day. On those days, they are allowed to work only until 7:00 p.m.

Employees who are aged 16 and 17 may not work more than 9 hours in a day, more than 40 hours in a school week, more than 48 hours in a non-school week, or more than 6 days per week. These employees may not start work before 6:00 a.m., but they may work until as late as 10:00 p.m. on a night that precedes a school day. This does not apply if the minor is working in an occupation deemed by the Commissioner of Labor to be: “(1) dangerous to life or limb; or (2) injurious to health or morals.” If a parent gives written permission, these employees may work until 11:00 p.m. on a night that precedes a school day. This written permission must be kept on file by the employer.

One rule regarding hours of employment has stayed the same: employees under the age of 18 may not work after 10:00 p.m. or before 6:00 a.m. in an establishment that is open to the public after 10:00 p.m. or before 6:00 a.m., unless another employee, who is at least 18 years old, also works with the minor.

The new law also removes several key provisions regarding the employment of minors. Employers are no longer required to provide additional rest breaks for an employee who is under 18. However, the law allows the Indiana Department of Labor to establish recommendations for rest breaks for minors.

Minors also are no longer required to present a written exception from their school allowing them to work between 7:30 a.m. and 3:30 p.m. on school days. However, employees who are under 16 may not be employed or permitted to work during school hours.

The new law also places additional requirements on employers. Significantly, an employer that employs at least 5 individuals 14 to 17 of age must register with the Department of Labor. The Department of Labor has until July 1, 2021, to develop a database that is open to the public, showing which businesses employ minors.

Additionally, employers are no longer allowed to pay minors below the federal minimum wage during the first 90 days of employment.


Court Cases

Ninth Circuit Holds That Background Check Disclosures Should Not Contain Any Extraneous Information
In March 2017, the plaintiff applied for a job with a supermarket. As part of the hiring process, the store presented the plaintiff with several disclosure and acknowledgement forms, including two documents concerning an investigation of his background. One of the documents was a “Disclosure Regarding Consumer Reports and Investigative Consumer Reports” (the disclosure), which advised the plaintiff of the store’s intent to order his background check. The second document was an “Authorization Regarding Consumer Reports and Investigative Consumer Reports,” which sought the plaintiff’s consent for the background check. A few weeks later, the store sent to the plaintiff a pre-adverse action notice, which included a copy of his background check report and advised him of, among other things, the right to dispute the accuracy or completeness of the report with the consumer reporting agency (“CRA”) that prepared the report. Nothing in the letter advised the plaintiff that he could discuss the report directly with the store. Five business days later, the CRA sent to the plaintiff an adverse action notice, which advised of the store’s decision not to continue his employment. The plaintiff filed a putative class action alleging the store violated the FCRA by: (1) providing an unclear disclosure form with extraneous text and (2) failing to notify the plaintiff in the pre-adverse action notice that he could discuss the report directly with the store. The district court granted the store’s motion to dismiss both claims.

Disclosure Claim
The FCRA requires employers who obtain a background check report on a job applicant to first provide the applicant with a “clear and conspicuous disclosure” that the employee may obtain such a report. The Ninth Circuit previously held in Syed v. M-I, LLC, 853 F.3d 492 (9th Cir. 2017), that this language requires the disclosure to consist “solely” of the disclosure. In other words, according to Syed, the FCRA’s disclosure requirements do not allow for the inclusion of extraneous information in the disclosure, even if the information is related to the disclosure. It is against this backdrop that the Ninth Circuit in Walker v. Fred Meyer, Inc., No. 18-35592 (9th Cir. March 20, 2020), addressed “as a matter of first impression what qualifies as part of “the disclosure.

In reversing the district court’s dismissal of the disclosure claim, the Court rejected the employer’s argument that “some additional information” may be included in the disclosure so long as the information is “closely related” to the disclosure and “focuses the applicant’s attention on the FCRA disclosure rather than detracting from it.” In doing so, the Court noted that its recent decision in Gilberg v. Cal. Check Cashing Stores, LLC, had foreclosed the possibility of the inclusion of information that is simply “closely related” to the disclosure.

The Ninth Circuit concluded by making it clear that “a disclosure form violates the FCRA’s standalone requirement if it contains any extraneous information beyond the disclosure required by the FCRA.” It then addressed what qualifies as part of the disclosure, noting that beyond a plain statement disclosing “that a consumer report may be obtained for employment purposes,” some concise explanation of what the phrase means may be included. The Court provided examples of information that would further the purpose of the disclosure by helping the applicant understand the document, including that an employer “could briefly describe what a ‘consumer report’ entails, how it will be ‘obtained,’ and for which type of ‘employment purposes’ it may be used.” The Court rejected the plaintiff’s argument that the disclosure was not standalone because it referenced “investigative consumer reports,” concluding that such reports are “a subcategory or specific type of consumer report.” Thus, the Court reasoned, “[a]s long as the information about investigative reports is limited to disclosing that such reports may be obtained for employment purposes, and providing a very brief description of what that means,” the inclusion of such information in the disclosure “does not run afoul of the standalone requirement.”

The Court’s opinion is particularly instructive because it reviewed the text of the entire disclosure at issue to determine whether it contained extraneous information in violation of the FCRA. After quoting the disclosure in its entirety, the Court focused on the following text, which it found to be problematic and, thus, unlawful:

You may inspect [CRA’s] files about you (in person, by mail, or by phone) by providing identification to [CRA]. If you do, [CRA] will provide you help to understand the files, including communication with trained personnel and an explanation of any codes. Another person may accompany you by providing identification.

If [CRA] obtains any information by interview, you have the right o obtain a complete and accurate disclosure of the scope and nature of the investigation performed.

While the Ninth Circuit recognized that these two paragraphs were a good faith effort to provide information that an applicant might find useful, it found the language “extraneous” because it might “pull[ ] the applicant’s attention away from his privacy rights protected by the FCRA by calling his attention to the rights” the applicant has to inspect the CRA’s files. Instead of including the two paragraphs in the disclosure, the Court said the employer should have provided the information in a separate document “because the information cannot reasonably be deemed part of a ‘disclosure … that a consumer report will be obtained for employment purposes.’” Because the district court did not address whether the text of the disclosure violated the FCRA’s requirement that the disclosure also be “clear and conspicuous,” the Court remanded that issue to the district court.

Pre-Adverse Action Claim
With respect to the plaintiff’s pre-adverse action notice claim, the Ninth Circuit affirmed dismissal, holding that the FCRA’s requirement that an applicant or employee be provided the right to dispute inaccurate information in a consumer report does not also require employers to provide applicants or employees with an opportunity to discuss their reports directly with the employer. Rather, according to the Court, the employer need only provide, in a pre-adverse action notice to the applicant or employee, a description of the individual’s right to dispute with the background check company the completeness or accuracy of any item of information in the applicant or employee’s file with the background check company. Having done that, the Court agreed that the employer complied with the FCRA’s pre-adverse action requirement.

Ninth Circuit Holds Employers May Provide a Standalone Background Check Disclosure Concurrently with Other Documents
On April 24, 2020, the Ninth Circuit held that the Fair Credit Reporting Act (FCRA) permits an employer to provide job applicants with a background check disclosure document at the same time the employer provides job applicants with other documents, so long as the background check disclosure is presented in a “standalone” document.1 In so holding, the Ninth Circuit declined to extend its prior trio of rulings (SyedGilberg and Walker) that adopted a formalistic interpretation of the FCRA’s standalone disclosure rule.

This is the Ninth Circuit’s fourth decision since 2017 regarding an employer’s obligation to disclose its intent to order a background report “in a document consisting solely of the disclosure,” commonly referred to as the “standalone” requirement. In its prior trio of decisions, the Ninth Circuit interpreted the barebones language in the FCRA – “a document consisting solely of the disclosure” – quite literally, reasoning that the word “solely” means “alone, singly” or “entirely, exclusively” so that “FCRA precludes the inclusion of any terms besides a disclosure and an exempted authorization.” In its latest decision, the Ninth Circuit rejected the plaintiff’s argument that a single-page, two-sentence document entitled “Fair Credit Reporting Act Disclosure Statement” was not “standalone” because the employer presented it contemporaneously with a separate multi-page document with notices, waivers, and agreements unrelated to the background check. The Ninth Circuit held that an employer may provide a standalone FCRA disclosure contemporaneously with other documents. The court held that the employer’s disclosure document satisfied the “standalone” requirement because that single-page document included nothing beyond disclosing an intent to obtain a background report, the employer’s logo, and a signature block.

Takeaways for Employers
The Ninth Circuit is the only federal appellate court to interpret the “standalone” disclosure requirement to date. Whether other courts will follow the Ninth Circuit’s hyper-technical reading of the statute remains to be seen. In the meantime, it is prudent for employers to continue to intensively scrutinize the text and presentation of the background check disclosure document to candidates in hard copy and electronic format. The number of class action lawsuits against employers continue to spike. Relatedly, employers should be mindful of compliance with the growing list of state and local laws that govern background check disclosures and inquiries into and the use of criminal history and credit history information.

Is the Government Immune from FCRA Suits?
As of 2018, the Department of Education had issued $1.5 trillion in student loans. As the United States’ top student-loan lender, it is one of the largest furnishers of credit data in the country. That’s right, the Government as a furnisher. Who would have thought? Does that mean a borrower can sue the Department of Education if it violates the Fair Credit Reporting Act (“FCRA”)? If the borrower lives in the Seventh Circuit, he or she can. Currently, there is a Circuit split on whether the general civil enforcement provisions of the FCRA, 15 U. S. C. §§1681n–1681o, waive the Federal Government’s sovereign immunity for FCRA civil enforcement suits. Just this week, in Anthony Robison v. Department of Education, 590 U.S. ___ (2020), the Supreme Court denied Mr. Robinson’s writ of certiorari, leaving the split, well split. This means borrowers in Seventh Circuit states have a cause of action against the Department of Education while borrowers with same types of loans in Ninth and Fourth Circuit states are barred from suit. At least for now.

But this was not a unanimous Supreme Court denial. Justice Thomas, with whom Justice Kavanaugh joined, dissented because they believed that the question concerned a “matter of great importance” that has divided the Circuits making it ripe for Supreme Court intervention. Their primary concern is the potential litigation exposure the Department of Education faces, where a “waiver of sovereign immunity would thus have a significant impact on the public fisc.” Id. at 4. In short, with trillions of dollars in loans, potential plaintiffs could riddle the department with time-consuming and costly litigation at a great expense to the American people.

So what is the split? The split turns on the definition of “person” under the FCRA and “whether the inclusion of ‘governmental . . . agency’ in the FCRA’s definition of ‘person’ constitutes an unequivocal waiver of the federal government’s immunity from money damages and subjects the United States to the various provisions directed at ‘any person’ who violates the law.” Daniel v. Nat’l Park Serv., 891 F.3d 762, 769 (9th Cir. 2018). The statute defines person as “any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.” 15 U.S.C. §1681a(b)(emphasis added).

But even though “government” is plainly in the statutory definition of “person”, both the Fourth and Ninth Circuits held that the statute text is not “unambiguous and unequivocal” to amount to a waiver of sovereign immunity, especially when the statutory framework is considered as a whole. See Robinson v. United States Dep’t of Educ., 917 F.3d 799 (4th Cir. 2019); see also Daniel v. Nat’l Park Serv., 891 F.3d 762 (9th Cir. 2018).

On the other hand, the Seventh Circuit held that the government is a person within the plain reading of the statute and thereby sovereign immunity is waived because “[t]he United States is a government. One would suppose that the end of the inquiry. By authorizing monetary relief against every kind of government, the United States has waived its sovereign immunity. And so we conclude.” Bormes v. United States, 759 F.3d 793, 795 (7th Cir. 2014). And there you have it.

So, who is going to fix this? The Circuits or Congress – or maybe a very large judgment against the Government that peaks the Supreme Court’s interest again. Indeed, the Supreme Court has found the government immune under other consumer privacy statutes like the TCPA. See, e.g., Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663, 672 (2016)(noting that “[t]he United States and its agencies, it is undisputed, are not subject to the TCPA’s prohibitions because no statute lifts their immunity”, but the immunity did not pass-through to the federal subcontractor in Cambell). So, no matter how this split is to be resolved, this is one to watch and we will keep you posted.

District Court Holds CRAs Not Obligated To Determine Legal Status of Debt
Earlier this month, in Davis v. Carrington Mortgage Services, LLC, et al., the United States District Court for the District of Nevada held that consumer reporting agencies are not obligated to determine the legal status of debts. The Court also reinforced the plausible pleading standard for Fair Credit Reporting Act cases, while providing an overview of CRAs’ obligations under the act. Plaintiff Cheryl Davis alleged that a national CRA violated sections 1681e and 1681i of the FCRA by reporting inaccurate credit information and failing to follow reasonable procedures to verify the accuracy of the information that it reported. Specifically, Davis claimed that following her discharge from Chapter 13 bankruptcy, the CRA inaccurately reported her mortgage account with a $0 balance and a notation that the account was discharged in bankruptcy. Davis claimed that this reporting was inaccurate, as the account was excepted from her discharge and she had continued to make timely payments. Davis claimed to have disputed the reporting by letter to the CRA, but alleged that the inaccurate reporting continued. Davis alleged that the “suppression of her positive payment history” caused her credit injuries, emotional harm, and actual damages. The CRA moved to dismiss the complaint, arguing that Davis lacked standing and had failed to state a claim under the FCRA. The Court quickly rejected the CRA’s argument that Davis’s “broad generalizations” regarding the impact of lower FICO scores on lending decisions did not support a concrete and particularized injury. Instead, the Court found that Davis plausibly alleged that the reporting could have resulted in less favorable refinance terms. Accordingly, the Court held that Davis had Article III standing.

Next, the Court summarized what a plaintiff must plausibly allege to support a claim under sections 1681e and 1681i of the FCRA, including the threshold requirement under both sections – that a consumer first make a prima facie showing of inaccurate reporting. The Court explained that “[r]eporting can be inaccurate if it is patently incorrect or ‘misleading in such a way and to such an extent that it can be expected to adversely affect credit decisions.’” Furthermore, to state a claim under Section 1681e(b), a plaintiff also is required to plausibly allege that the CRA failed to follow reasonable procedures in obtaining a plaintiff’s credit information. To state a claim under Section 1681i(a), a plaintiff must plausibly show: (1) plaintiff “notified the CRA of the inaccuracy;” (2) “the dispute was not frivolous or irrelevant;” (3) “the CRA failed to respond to the dispute;” and (4) the “failure caused plaintiff to suffer actual damages.” The Court found that Davis’s claims failed, as she did not plausibly allege that the CRA’s procedures were unreasonable. In the dispute letter before the Court, Davis asked only that the CRA include her positive payment information on her credit report. In response, the CRA obtained verification from Davis’s mortgage company verifying that the account was included in her bankruptcy. Subsequently, the CRA continued to report the purportedly inaccurate information – that Davis’s mortgage account was included in her Chapter 13 discharge.

Accordingly, the Court held that the CRA was not obligated to reinvestigate the accuracy of whether Davis’s mortgage account was discharged in bankruptcy, as “CRAs are neither qualified nor obligated to determine the legal status of a plaintiff’s debt.” Further, the Court held that it was reasonable for the CRA to report the mortgage as included in bankruptcy when “there is a bankruptcy on record and no contrary information to indicate that her account was excepted from discharge.” While decided based on Davis’s failure to plausibly state a claim, this decision demonstrates a continuing trend of courts shielding CRAs from liability under the FCRA when faced with determining the legal status of a consumer’s debt obligation.


Other Developments

EEOC Issues Technical Assistance on COVID-19 Workplace Issues
The Equal Employment Opportunity Commission (EEOC) has issued updated technical assistance to help employers address a number of workplace issues relating to COVID-19, and to reconcile guidance from the Center for Disease Control (CDC) and state and local public health authorities with employer obligations under EEO laws. Here are the key highlights.

COVID-19 Pandemic Medical Inquiries and Exams
Consistent with recommendations from the CDC about how to avoid further spread of the disease, the updated guidance clarifies that employers have discretion to inquire about COVID-19-related medical conditions and to take steps that ordinarily would not be allowed.

Specifically, employers may now:

  • Ask employees who call in sick if they are experiencing symptoms identified as associated with COVID-19 by the CDC, other reputable medical sources;
  • Take the temperatures of employees (e.g., at the beginning of each workday or shift);
  • Require employees who are experiencing COVID-19 symptoms to leave the workplace; or
  • Require a doctor’s note certifying fitness for duty after an employee returns to work after exhibiting COVID-19 symptoms. Other types of certifications may also suffice (e.g., a form or email certifying that the individual does not have COVID-19.)

Employers that collect and retain medical information related to COVID-19 must maintain that the information is in compliance with the ADA (in a medical file, stored separately from an employer’s personnel file).

Reasonable Accommodation
Employers are reminded that low-cost solutions are often available to provide protection against exposure to COVID-19 in the workplace, especially for employees with pre-existing conditions that may put them at higher risk from COVID-19. Among other things, employers should consider designating one-way aisles in stores or facilities, or using plexiglass, tables, or other barriers to ensure minimum distances between customers and coworkers whenever feasible.

Employers should consider accommodations such as a temporary job restructuring, temporary transfer to a different position, or work schedule modification.

Other advice includes:

  • In the event of urgent requests for accommodation or limited time to explore requests for accommodation, employers may choose to forego or shorten the interactive process by granting a temporary or interim accommodation and set an end date at which time the accommodation can be re-evaluated.
  • To prepare for future accommodations, employers may ask employees with disabilities to request accommodations and begin the interactive process for accommodations that employees believe they may need when the workplace re-opens.
  • In deciding whether a particular accommodation amounts an “undue hardship,” the sudden loss of income stream because of the pandemic is appropriate. But employers cannot simply reject accommodations because they will result in some costs; the employer must still weigh costs against capabilities and work with the employee to explore alternatives.

The guidance recommends proactive measures to prevent discrimination and harassment, starting with explicit communication to the workforce that fear of the pandemic should not be misdirected toward individuals on the basis of national origin, race, or other prohibited basis. The guidance also directs employers to its anti-harassment policy tips and guides on harassment prevention.

The guidance provides no specific guidance regarding COVID-19-related furloughs and layoffs, but reminds employers that special rules apply when offering employee severance packages in exchange for a general release of all discrimination claims and provides a link to other EEOC technical assistance guidance.

As government stay-at-homes orders are lifted, the guidance reaffirms that the ADA permits employers to make disability-related inquiries and conduct medical exams if job-related and consistent with business necessity. Inquiries and reliable medical exams meet this standard if they are necessary to exclude employees with a medical condition that would pose a direct threat to health or safety.

Because guidance from the CDC and public health authorities has deemed COVID-19 a direct threat to health and safety, employers act consistently with the ADA as long as any screening implemented is consistent with advice from the CDC and public health authorities for that type of workplace at that time and they do not engage in unlawful disparate treatment based on any protected characteristic.

While the EEOC’s guidance reminds employers that all of the EEO laws it enforces remain in effect during the COVID-19 pandemic, it also emphasizes that those laws do not interfere with or prevent employers from following guidelines made by the CDC or state and local public health authorities regarding COVID-19. Because its guidance permits employers increased discretion and flexibility to respond to the pandemic crisis and maintain workplace safety, it is critical that employers remain up to date on all EEOC updates to ensure they are meeting their obligations under rapidly changing conditions.

COVID-19, Your Employees and the Law

Essential businesses that have remained open during COVID-19 safer-at-home ordinances, and those that are opening again as some states loosen restrictions, have had some entirely new concerns about the laws that may affect important but previously unpracticed daily protocols. It’s certainly important to establish the safest possible environment for your employees, customers, and clients. But, if your business is doing temperature checks on the team or offering virtual medical appointments during the workday, are you responsible for adhering to healthcare privacy laws or other regulations?


Employment and Civil Rights Protections During COVID-19


It’s always of utmost importance to protect the civil rights of everyone employed by your business, but awareness and mitigation of potential violations must be heightened during a public health emergency of this magnitude.


Suspicions can run high when employees are afraid, but it’s important to maintain a safe environment for anyone on the receiving end of the rumor mill. Some of the ways employers can help reduce both anxiety and worker discrimination can be found on the CDC Reducing Stigma webpage. Additional information about civil rights protections can be found in Mar. 28, 2020 Bulletin from the Department of Health and Human Services (HHS).


HIPAA Privacy Protections for Employees During COVID-19


In its summary of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rule, HHS writes:


“The Privacy Rule protects all “individually identifiable health information” held or transmitted by a covered entity or its business associate, in any form or media, whether electronic, paper or oral. The Privacy Rule calls this information “protected health information (PHI).”


A temperature check is considered a medical examination and would generally fall under this rule, but allowances for the procedure have been made by the CDC and/or local health authorities because of the health emergency. In other words, the HIPAA Privacy Rule may not apply to employers in this context of workplace COVID-19 screening. But, in its Interim Guidance for Businesses and Employers to Plan and Respond to Coronavirus Disease 2019 (COVID-19), the CDC says:


“If an employee is confirmed to have COVID-19, employers should inform fellow employees of their possible exposure to COVID-19 in the workplace but maintain confidentiality as required by the Americans with Disabilities Act (ADA).”


Employee Protections Will Be a Balancing Act


Taking the above guidance into consideration, you and every employer that’s outside the healthcare industry will have to manage a difficult balancing act during this unprecedented health emergency. Everyone is on a learning curve and while there is surely room for error, it is important to make a good faith effort to adhere to the regulations that are in place. Talk to your legal counsel and communicate with your local health authorities to gain clarity. This may the most important time in the life of your business to be overly cautious and overly informed about the laws that affect you and your team.

For more in-depth information about how COVID-19 affects privacy and your business, visit this recent blog by Nicolas Dufour, our EVP and General Counsel. ClearStar is here to provide background screening and other HR solutions for your business. Contact us to learn more about how our team works for you while offering protections like up-to-the-minute compliance with changing employment, data, and privacy laws.

Online ID Verification Needs are Booming Due to COVID-19 Workplace Changes

Physical distancing regulations around the world have forced many businesses to recalibrate quickly. And while COVID-19 has relegated some businesses to irrelevance–temporarily, we hope–it’s also pushed many to begin providing virtual services instead.


The switch can be a win-win. Virtual services and storefronts maintain income for the business while keeping employees and customers coronavirus-free. The biggest drawback, though, can be the sudden need for foolproof online security protocols, especially when it comes to identification.


COVID-19 is Driving the Need for Virtual Healthcare


Most specifically, the highly contagious nature of COVID-19 has stressed many hospitals, clinics, and doctors’ offices with an influx of patients and forced remaining healthcare providers to work overtime in hopes of maintaining virus-free facilities. The only way many providers can continue to see patients safely is through virtual appointments via a mobile device, desktop or laptop computer.


Virtual patient appointments have become such an urgent need, that the federal government recently loosened its restrictions on virtual consults for Medicare recipients, and private insurance providers are encouraging them for as many medical concerns as possible.


Additionally, businesses in a variety of industries are still functioning, providing essential services and employing large teams on-site. And, the nature of sharing a workplace means­–even while 6’ apart and with every precaution in place–essential workers are at risk. So, many of these businesses have partnered with virtual healthcare providers for help with diagnosing COVID-19 infections at their workplaces. For these employers, a virtual medical appointment for employees during the workday needs to be as easy as student visits to the school nurse during a school day.


Mobile Solutions for Secure Virtual Services


Whether a workplace is in the business of providing the virtual healthcare or accepting it for workers, every bit of communication regarding an individual’s health–whether between patient and provider, among the provider’s staff or within the workplace–must be secure. That kind of security starts with verifiable personal identification.


From comprehensive mobile background screening like ClearID to Remote-Controlled Badging like VirtualBadge®, ClearStar offers stand-alone tools and integrated solutions for managing workforces. Ask ClearStar how our knowledge of the industry-, location-, and data-specific regulatory compliance makes our tools an especially valuable solution for healthcare industry-related security needs.

Using Arrest and Conviction Records in Employment Decisions

When conducting background checks for employment purposes, it is sometimes difficult for an employer to know what should or shouldn’t be considered when making a hiring decision.  While in the process of filling an open position, you may discover that an applicant has a criminal record.  How do you consider an individual’s record when making hiring or other employment decisions?

The FCRA, state and local legislation and best practice policies of screening companies typically dictate what information can be reported to an employer.  However, there are additional factors such as the Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., Title VII of the Civil Rights Act, state or local legislation and others that provide guidance and/or impose limitations to employers when using arrest and/or conviction records in making a hiring determination.  There are also further guidelines and specific requirements for hiring in certain industries such as healthcare, financial and educational institutions, etc.

We’ll go through some of the most common guidelines recommended by the EEOC here.


EEOC Guidelines

The EEOC offers the following guidance on using criminal records:

  • Treat applicants with similar criminal records consistently
  • Avoid using a policy that excludes individuals with certain criminal records if the policy significantly disadvantages a particular group, race, national origin, etc. and does not accurately predict who will be a responsible, reliable or safe employee.
  • If you must ask about an applicant’s criminal history, wait until later in the hiring process
  • Determine how the applicant’s criminal history relates to the job
  • Treat arrest records differently than convictions. The fact that someone has been arrested does not mean they have committed a criminal act
  • Review the accuracy and relevance of a conviction record before taking action
  • Give applicants an opportunity to explain their criminal history.

The EEOC also recommends that an employer conduct an individualized assessment and a review of the criminal records and provides an opportunity for the applicant to demonstrate that they should not be excluded from the position applied for.  The individual can include such information as:

  • Not being correctly identified in the background report
  • The facts and/or circumstances surrounding the offense
  • The number of offenses in which the individual was convicted
  • Older age at the time of conviction or release from incarceration
  • Evidence of successfully performing similar work for other companies post-conviction/release
  • The length and consistency of employment prior to and after the offense
  • Rehabilitation efforts and/or additional education or training
  • Employment and character references
  • Whether the individual is bonded under a federal, state or local bonding program

If an individual does not respond to an employer’s attempts to obtain additional information, the employer may make a decision without the information.

Additionally, legislation and regulations may impose additional responsibilities and/or restrictions on your hiring practices.

The Fair Credit Reporting Act (FCRA) requires you to take certain steps before you can conduct a background check (Disclosure and Written Authorization) and additional responsibilities you must follow before taking any adverse action (Pre-Adverse and Adverse Action Letters).

There are also “Ban-the-Box” legislation, regulations and ordinances that usually prohibit employers from asking about an applicant’s criminal history information on the initial job application. However, in the last few years, “Ban-the-Box” legislation, regulations and ordinances are much more comprehensive than simply removing the criminal history question from the application and generally impose material additional limitations on employers.


For a recent published list of states, cities, and counties with Ban the Box Regulations, please see:


Depending on the location where the job is located and where the applicant resides, having a compliant program can be complicated and we recommend that you consult with your legal counsel to develop a consistent, compliant screening and hiring program to ensure federal, state and local guidelines are followed.


During these uncertain times, ClearStar understands the impact COVID-19 is having on your business and your screening needs. We are here to support you and will continue to provide you with all the screening services you need to keep your business moving forward. Contact ClearStar and let us know how we can help you recruit and hire the best talent, especially under current circumstances. This is for the record.

For The Public Record is a monthly blog featuring thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process. Click here to subscribe.

Real Tips for Better Virtual Onboarding

If you’re an HR person, it’s very likely you sought out your career because you thrive on the “human” part of the business. You’re a people person! And, you are the face of your company, warmly welcoming new hires, touring them around the workplace, introducing them to their coworkers, and getting them on board with all of the tools and processes they need for success at work.


As we experience COVID-19 quarantines and safer-at-home restrictions for the first time, well, ever, you now have to be that same warm and enthusiastic face to your new hires through a computer screen instead of in person. Your training folders and photocopies, tours, and meetings all have to be digital now. How do you effectively transition your well-honed onboarding processes from the physical realm to the virtual one?


Embrace Efficiency

Virtual onboarding is an opportunity for improved efficiency. Streamlining processes is key. The face-to-face video conference is your starting point. You can rely on scheduling software and project management tools to drive the onboarding process from there.


  • Block time for digital paperwork and set each document as a task. Setting the completion of onboarding documents as tasks–with deadlines–on your new hire’s calendar or to-do list, creates clarity and sets an expectation. It also ensures nothing gets overlooked.
  • Pre-schedule video training sessions and one-on-ones with managers and key co-workers. Be on those calls to do introductions and facilitate conversation. You won’t be able to knock on doors or camp out next to desks in order to keep things moving, so team calendars can do the job of keeping everyone on time.
  • Include managers in the workflows when needed. If virtual onboarding is new to them, too, team project management tools can keep them on task when a signature is required, or a live training session is needed.
  • Don’t hesitate to follow up with your new hire and your managers at pre-determined points in the onboarding process to ensure accountability and gain insight into the effectiveness of the workflow.


Be Available

During virtual onboarding, remember your new hire can’t just pop into an office or quickly ask a coworker, “What’s next?” and that can leave them feeling disconnected. Let them know you’re available for questions and provide them with a variety of communication channels through which they can reach you easily. Make sure that you and/or an experienced point person are available to them at any time during the way day via email, instant chat, text, or the good ol’ telephone call, to answer urgent questions or kickstart a stalled process.

The need for 100% virtual onboarding won’t last forever, but COVID-19 is certainly driving process improvements and discoveries that may streamline onboarding when your workplace returns to the real world.


If your business could benefit from outside help with remote human resources needs, ask ClearStar about our commitment to candidate care throughout your virtual recruiting, screening, and HR management processes.

Online Resources to Help HR Managers Navigate COVID-19 Issues

We are all trying our best to maintain some normalcy in our daily lives under a barrage of information about COVID-19 that becomes more and more overwhelming, confusing, and disheartening every day.


LinkedIn feeds are heavily weighted towards updates about job losses while social media channels are filled with posts about personal fears, opinions about nearly everything, game requests, line graphs, memes and so much more.


It’s heavy for everyone as we sort through fact from fiction. But, when you’re a go-to person for workplace leadership­, and your co-workers are looking to you for guidance, how can you be sure you’ve been informed by the best sources­? COVID-19 is uncharted waters for absolutely everyone and ClearStar would like to offer a little help to employers.


COVID-19 Resources Specifically for HR

Navigating life during a global pandemic is mystifying enough as the medical community tries to reverse engineer it for healthcare purposes, but it’s all the more confusing when local, federal, and business sector directives seem to change minute-by-minute.


SHRM (the Society for Human Resource Management) has organized a comprehensive set of resources just for employers. Some of the resources are for SHRM members only, but the following links are available to everyone.



SHRM also offers advance search tools and free access to a limited number of timely articles related to our current concerns. There’s great information on their site; no membership required.


General New Resources for COVID-19

In addition to work-related resources, it can be helpful to have general news resources at hand for updates about local and global affairs related to COVID-19.


The U.S. is home to two of the oldest independent wire services (aka news agencies) in the world. Wire services–which are established to be non-biased news reporting and distribution services–are excellent resources for journalistic reporting on a variety of topics. They excel at delivering breaking news.


  • The Associated Press (AP) is a non-profit agency founded in 1846 and remains the largest wire service in North America. AP publishes print, audio, and video news 24/7 via the web, social media, email, blogs, RSS feeds, and smartphone apps. Start with front-page news at or go straight pieces on the topic of COVID-19.


  • United Press International (UPI), founded in 1907, also published new 24/7 on the web and via its social media channels, email newsletters, RSS feeds, and a smartphone app. Start with front-page news at or go straight to articles on the topic of COVID-19.


Whatever your role in your workplace, we hope you’ll find some reassurance in these information sources.


We know your workforce is changing drastically and unpredictably right now. Please contact ClearStar if you feel your business could benefit from some outside help for recruiting, screening, and/or managing employees. Not only do we have expertise in compliance, security, data management and more, we understand the importance of providing candidate care throughout our efforts.

March 2020 Screening Compliance Update

Federal Developments

DOT Releases Guidance Related to COVID-19.

On March 23, DOT released guidance related to COVID-19 that can be retrieved at:

EEOC Updates 2009 Pandemic Preparedness Guidance

The EEOC issued more guidance! On March 19, 2020, the Equal Employment Opportunity Commission updated its 2009 Pandemic Preparedness Guidance to address questions concerning the COVID-19 pandemic. The document is entitled, “What You Should Know About the ADA, the Rehabilitation Act, and COVID-19.” This COVID-19 communication repeatedly references the EEOC’s 2009 pandemic guidance, which was originally released in connection with the H1NI outbreak.

The EEOC’s revised pandemic guidance states that the COVID-19 pandemic meets the direct threat standard based on the guidance of the CDC and public health authorities. This statement affects the analysis of many of the questions and answers posed in pandemic guidance. Employers should read the revised guidance thoroughly and consult counsel, however, as the EEOC’s guidance does not address state-specific concerns or provide comprehensive information about other legal requirements related to employee privacy, compensation, etc.

Many of the significant additions are included below, with COVID-19 updates in bold (quoted verbatim):


  • May an ADA-covered employer send employees home if they display influenza-like symptoms during a pandemic?


Yes. The CDC states that employees who become ill with symptoms of influenza-like illness at work during a pandemic should leave the workplace. Advising such workers to go home is not a disability-related action if the illness is akin to seasonal influenza or the 2009 spring/summer H1N1 virus. Additionally, the action would be permitted under the ADA if the illness were serious enough to pose a direct threat. Applying this principle to current CDC guidance on COVID-19, this means an employer can send home an employee with COVID-19 or symptoms associated with it.


  • During a pandemic, how much information may an ADA-covered employer request from employees who report feeling ill at work or who call in sick


ADA-covered employers may ask such employees if they are experiencing influenza-like symptoms, such as fever or chills and a cough or sore throat. Employers must maintain all information about employee illness as a confidential medical record in compliance with the ADA.

If pandemic influenza is like seasonal influenza or spring/summer 2009 H1N1, these inquiries are not disability-related. If pandemic influenza becomes severe, the inquiries, even if disability-related, are justified by a reasonable belief based on objective evidence that the severe form of pandemic influenza poses a direct threat.

Applying this principle to current CDC guidance on COVID-19, employers may ask employees who report feeling ill at work, or who call in sick, questions about their symptoms to determine if they have or may have COVID-19. Currently, these symptoms include, for example, fever, chills, cough, shortness of breath, or sore throat.


  • During a pandemic, may an ADA-covered employer take its employees’ temperatures to determine whether they have a fever?


Generally, measuring an employee’s body temperature is a medical examination. If pandemic influenza symptoms become more severe than the seasonal flu or the H1N1 virus in the spring/summer of 2009, or if pandemic influenza becomes widespread in the community as assessed by state or local health authorities or the CDC, then employers may measure employees’ body temperature.

However, employers should be aware that some people with influenza, including the 2009 H1N1 virus or COVID-19, do not have a fever.

Because the CDC and state/local health authorities have acknowledged community spread of COVID-19 and issued attendant precautions as of March 2020, employers may measure employees’ body temperature. As with all medical information, the fact that an employee had a fever or other symptoms would be subject to ADA confidentiality requirements.


  • When an employee returns from travel during a pandemic, must an employer wait until the employee develops influenza symptoms to ask questions about exposure to pandemic influenza during the trip?


No. These would not be disability-related inquiries. If the CDC or state or local public health officials recommend that people who visit specified locations remain at home for several days until it is clear they do not have pandemic influenza symptoms, an employer may ask whether employees are returning from these locations, even if the travel was personal.

Similarly, with respect to the current COVID-19 pandemic, employers may follow the advice of the CDC and state/local public health authorities regarding the information needed to permit an employee’s return to the workplace after visiting a specified location, whether for business or personal reasons.


  • May an employer covered by the ADA and Title VII of the Civil Rights Act of 1964 compel all of its employees to take the influenza vaccine regardless of their medical conditions or their religious beliefs during a pandemic?


No. An employee may be entitled to an exemption from a mandatory vaccination requirement based on an ADA disability that prevents him from taking the influenza vaccine. This would be a reasonable accommodation barring undue hardship (significant difficulty or expense). Similarly, under Title VII of the Civil Rights Act of 1964, once an employer receives notice that an employee’s sincerely held religious belief, practice, or observance prevents him from taking the influenza vaccine, the employer must provide a reasonable accommodation unless it would pose an undue hardship as defined by Title VII (“more than de minimis cost” to the operation of the employer’s business, which is a lower standard than under the ADA).

Generally, ADA-covered employers should consider simply encouraging employees to get the influenza vaccine rather than requiring them to take it. As of the date, this document is being issued, there is no vaccine available for COVID-19.


  • During a pandemic, must an employer continue to provide reasonable accommodations for employees with known disabilities that are unrelated to the pandemic, barring undue hardship?


Yes. An employer’s ADA responsibilities to individuals with disabilities continue during an influenza pandemic. Only when an employer can demonstrate that a person with a disability poses a direct threat, even after reasonable accommodation, can it lawfully exclude him from employment or employment-related activities.

If an employee with a disability needs the same reasonable accommodation at a telework site that he had at the workplace, the employer should provide that accommodation, absent undue hardship. In the event of undue hardship, the employer and employee should cooperate to identify an alternative reasonable accommodation.

The rapid spread of COVID-19 has disrupted normal work routines and may have resulted in unexpected or increased requests for reasonable accommodation. Although employers and employees should address these requests as soon as possible, the extraordinary circumstances of the COVID-19 pandemic may result in a delay in discussing requests and in providing accommodation where warranted. Employers and employees are encouraged to use interim solutions to enable employees to keep working as much as possible.


  • If an employer is hiring, may it screen applicants for symptoms of COVID-19?


Yes. An employer may screen job applicants for symptoms of COVID-19 after making a conditional job offer, as long as it does so for all entering employees in the same type of job. An employer may screen job applicants for symptoms of COVID-19 after making a conditional job offer, as long as it does so for all entering employees in the same type of job. This ADA rule allowing post-offer (but not pre-offer) medical inquiries and exams apply to all applicants, whether or not the applicant has a disability.


  • May an employer take an applicant’s temperature as part of a post-offer, pre-employment medical exam?


Yes. Any medical exams are permitted after an employer has made a conditional offer of employment. However, employers should be aware that some people with COVID-19 do not have a fever.


  • May an employer delay the start date of an applicant who has COVID-19 or symptoms associated with it?


Yes. According to current CDC guidance, an individual who has COVID-19 or symptoms associated with it should not be in the workplace.

CDC has issued guidance applicable to all workplaces generally but also has issued more specific guidance for particular types of workplaces (e.g. health care employees). Guidance from public health authorities is likely to change as the COVID-19 pandemic evolves. Therefore, employers should continue to follow the most current information on maintaining workplace safety. To repeat: the ADA does not interfere with employers following recommendations of the CDC or public health authorities, and employers should feel free to do so.


  • May an employer withdraw a job offer when it needs the applicant to start immediately but the individual has COVID-19 or symptoms of it?


Based on current CDC guidance, this individual cannot safely enter the workplace, and therefore the employer may withdraw the job offer.

Finally, it is noteworthy that the EEOC prefaced its updated pandemic preparedness guidance by stating “[e]mployers and employees should follow guidance from the Centers for Disease Control and Prevention (CDC) as well as state/local public health authorities on how best to slow the spread of this disease and protect workers, customers, clients, and the general public. The ADA and the Rehabilitation Act do not interfere with employers following advice from the CDC and other public health authorities on appropriate steps to take relating to the workplace.”

Please be aware that substantial changes in the governmental guidance and even in the underlying laws are occurring on almost a daily basis, which will impact the analysis of the legal issues related to COVID-19.

The Department of Homeland Security (DHS) announced that it will defer the in-person requirement associated with the Form I-9.

Employers with employees taking social distancing precautions due to COVID-19 will not be required to review the employee’s identity and employment authorization documents in the employee’s physical presence. This policy will remain in effect for a period of 60 days beginning March 20th or until three business days after the termination of the National Emergency, whichever is first. Once normal operations resume, all employers who were onboarded during this time must report to their employer within three business days for in-person verification of the document(s) presented for section 2 of the Form I-9. And, it is important for employers to understand that although the in-person requirement is waived, the Form I-9 must still be completed within three business days of hire. Click here to read more and click here for a full overview of COVID-19 related guidance issued by DHS addressing Form I-9 and E-Verify compliance.


In response to COVID-19, U.S. Citizenship and Immigration Services (USCIS) has suspended routine in-person services until at least April 1st.

USCIS staff will continue to perform duties that do not involve contact with the public and will continue to provide emergency services in limited situations. This means that the service centers will continue to process nonimmigrant petitions such as H-1B and L petitions. It also means that the H-1B random lottery will take place later this month. Click here and here to read more.


Get Familiar with OSHA’S Guidance on Preparing Workplaces for COVID-19

OSHA released it updated Guidance, Preparing Workplaces for COVID-19 last week. ( The guidance does not create new legal obligations for employers but, rather provides practical advice on measures we can take to limit the risk of exposure and infection for our employees and how to respond if an employee does become ill.

The Guidance identifies a range of levels of risk exposure: Very High – for those employees with a high potential for exposure, such as doctors or healthcare personnel who have direct contact with COVID-19 patients – to Lower Exposure Risk – workplaces which do not involve frequent contact with the public or COVID-19 patients. For each level of risk exposure, the Guidance details the steps we can implement to best manage the risk of exposure. As a starting point, OSHA recommends that all employers develop an infectious disease preparedness and response plan that complies with the latest Guidance. This will include encouraging employees to use proper hygiene practices and encouraging (requiring) sick employees to remain at home. The Guidance is not the law or mandatory, but it is a useful tool to use in navigating through this pandemic.


State Developments

Alabama Senate Passes Medical Marijuana Bill, Legislation Now Moves to the Alabama House

A bill that would legalize medical marijuana in Alabama cleared yet another hurdle late last week when it passed the Alabama Senate by a vote of 22 to 11. The bill now heads to the Alabama House, where it likely faces steeper opposition than in the Senate. The medical marijuana bill passed by the Senate, SB165, provides a regulatory framework similar to that imposed by other states’ legislation. For a more detailed description of the bill, please see our previous articles here and here. The version of SB165 the Senate passed differs from the version that was passed out of the Senate Judiciary Committee in several key ways:


  • Applicants for cultivation and processing licenses must have worked full time in either commercial horticulture or agronomic production for the eight years preceding their application;
  • 20-25% of all licenses granted by the Medical Cannabis Commission must be awarded to minority-owned businesses;
  • The power to add qualifying conditions now rests solely with the state legislature — all rule-making power in this area previously granted to the Medical Cannabis Commission is revoked;
  • Menopause and premenstrual syndrome are added as qualifying conditions; and
  • A consumption cap of 75mg a day for all users is imposed, and the bill restricts minors’ consumption to cannabis containing a maximum of 3% THC.


New Jersey Division on Civil Rights Releases Enforcement Guidance on State Equal Pay Act

The New Jersey Division on Civil Rights (DCR) has released 25-page guidance explaining its enforcement policies with respect to the state’s equal pay law. The guidance provides much-needed direction to companies navigating the pitfalls associated with compensation systems and policies. The guidance addresses questions ranging from multistate employees to affirmative defenses to the role of employer self-evaluations in the agency process. Furthermore, the DCR offers a guide to employer self-evaluations; however, it also cautions that such self-evaluation “is not, in and of itself, an affirmative defense to a claim brought under the Diane B. Allen Equal Pay Act.”

Overview of the Law

The guidance’s overview section includes a general explanation of the terms of the Equal Pay Act and the key differences between the state law and its federal counterpart. For example, the state law applies to all protected traits under the New Jersey Law Against Discrimination (LAD), which include traits not covered by federal law, such as military status. The state law also prohibits pay disparities for substantially similar work, as opposed to equal work under the federal law.

The DCR references figures from the U.S. Bureau of Labor Statistics, which show that Hispanic women earn only 62 percent of the compensation of white men, for example. The agency states that it intends to enforce the Equal Pay Act to address any such unlawful disparities that may exist.

Additionally, the DCR explains the Act contains a six-year lookback period for damages, rather than a six-year statute of limitations. The guidance makes clear that the Act allows “an employee who establishes discrimination in compensation to recover up to six years of back pay as long as the discrimination was continuous and the most recent violation occurred within the LAD’s two-year statute of limitations.”

The guidance concludes the overview section with discussions on anti-retaliation, remedies, and reporting requirements. Significantly, the DCR explains the anti-retaliation provisions apply to all employee actions concerning requests for information or legal counsel “related to a job title or compensation of employees or former employees, as well as the ‘gender, race, ethnicity, military status, or national origin’ of those employees, even if the employee’s action is unrelated to a claim for equal pay” (emphasis added). The DCR also explains that while a jury must award treble damages in the event of a violation, the DCR may award treble damages in the event of a violation.

The guidance’s Frequently Asked Questions (FAQs) section is key. It explains that:


  • The Act applies to out-of-state companies if the company maintains employees with a primary workplace in New Jersey.
  • Out-of-state employees may bring claims under the Act if they have a primary workplace in New Jersey. The DCR explains, by way of example, “an employee who lives in Pennsylvania but works in New Jersey several days a week is protected by the Equal Pay Act” (emphasis added).
  • Compensation under the Act includes not only the obvious (e.g., base wages, commissions, overtime pay, bonus pay, merit pay, and stock options), but such non-cash benefits as insurance, vacation time, and retirement funding.
  • Positions may meet the substantially similar threshold despite minor differences in skill, effort, and responsibility.
  • Skills not necessary to perform the functions of a particular job are irrelevant to the determination of whether positions are substantially similar (e.g., if an employee possesses a degree not relevant to the job performed).
  • Positions with separate functions may meet the substantially similar threshold. The DCR provides two examples of apparently different responsibilities that may meet the threshold: (1) contract review attorneys and litigators; and (2) janitors and food service employees.
  • The DCR will not rely solely on position descriptions and job titles in any enforcement matter; however, “they may be relevant to assessing whether two jobs require a similar degree of skill, effort, and responsibility.”


Significantly, on whether geographic differences constitute a bona fide reason for a pay disparity, the DCR answers in the affirmative. However, it cautions, if a company’s pay disparity stems from cost-of-living or demand differences, for example, the company also must demonstrate: (1) cost-of-living or demand are not based on and do not perpetuate an unlawful pay differential; (2) the factors were applied reasonably; (3) the factors account for the entire differential; and (4) the factors are job-related and based on business necessity. The DCR also notes that objective matters such as “sales numbers” constitute a bona fide reason for pay disparities.

Finally, while not expressly prohibiting ad hoc compensation decisions, the FAQs discuss the hallmarks of a seniority or merit system a company may rely on in defense against claims under the Act as being “predetermined or predefined by the employer” and uniformly applied without regard to employee membership in a protected class. The guidance cautions that individual determinations regarding an employee’s “worth” do not satisfy the requirement for a defense under the Act.

The DCR directs companies to the New Jersey Civil Service Commission’s “Guide to Self-Evaluations for Public Sector Employers,” which provides basic instructions on the steps involved in self-evaluation. However, the DCR cautions that any self-evaluation, or actions taken to address a pay disparity, do not constitute an affirmative defense to a claim under the Equal Pay Act.

Indeed, the only affirmative defenses under the Act are those in the statute: the differential must be based on a seniority or merit system or the disparity is:


  • Based on a legitimate factor other than the protected trait (e.g., training, education, experience, or productivity);
  • The legitimate factor is not based on or does not perpetuate a compensation differential based on a protected trait;
  • Each factor is applied reasonably;
  • One or more factors account for the entire wage differential; and
  • The factors are job-related with respect to the position and based on business necessity.


The DCR, however, will not consider any adjustments to compensation as an admission as to liability in any proceedings before the agency.

Key takeaways for companies from the DCR guidance include:


  • Revisit position descriptions to accurately capture skill, effort, and responsibility. Differences in anticipated physical exertion, mental exertion, supervisory responsibilities, credentials required to perform the functions of the position, and so on should be captured in the description.
  • An employee census focused on the location of work (rather than any reporting structure) is the most important factor inapplicability of the Act.
  • To the extent demand or geography requires pay differentials, ensure that a uniform disparity explains the gap.
  • Do not rely on a self-evaluation as an affirmative defense. While self-evaluations are recommended to limit any potential liability, any back pay does not shield an employer from legal action.


The guidance serves as a useful direction to employers seeking to ensure compliance efforts meet requirements under the Act. Please contact a Jackson Lewis attorney with any questions about the Act or the guidance.

Pre-Employment Testing for Marijuana in NYC?
In May 2019, Section 8-107 of title 8 of the NYC admin code was amended to make it unlawful for an employer and others to test for marijuana or THC as a condition of employment. This law becomes effective on May 10, 2020. The NYC Commission on Human Rights is promulgating rules for the implementation of this law. There was a public hearing on Jan. 9, 2020 concerning potential exceptions to the general prohibition on pre-employment testing to which written testimony by interested parties was submitted. There will be another opportunity for public comment if proposed rules are published, so keep an eye out for further notice from the commission. In the meantime, only the following exceptions which have been written into the law apply, such that pre-employment drug testing for marijuana or THC is permitted for the following jobs:


  • As police officers or peace officers, or in a position with law enforcement or investigative function at the department of investigation
  • Construction workers
  • Operators of vehicles requiring a commercial driver’s license
  • In any position requiring the supervision or care of children, medical patients or vulnerable persons
  • Or in any position with the potential to significantly impact the health or safety of employees or members of the public, as determined by: (i) the commissioner of citywide administrative services for the classified service of the city of New York, and identified on the website of the department of citywide administrative services or (ii) the chairperson, and identified in regulations promulgated by the commission

The legislation also permits pre-employment drug testing for marijuana and THC if required pursuant to:


  • Federal, state, or city department of transportation regulations or rules
  • Any federal contract or grant
  • Any federal or state statute, regulation, or order that requires drug testing of prospective employees for purposes of safety or security
  • a valid collective bargaining agreement that specifically addresses the pre-employment drug testing of such applicants

Utah State Legislature Clarifies: Private Employers Not Required to Accommodate Use of Medical Cannabis; Public Employers Held to Different Standard
Utah’s medical cannabis program officially launched this month, and the Utah State Legislature timely enacted Senate Bill 121, which amends and clarifies various provisions of Utah’s medical cannabis laws, including a pronouncement that private employers are not required to accommodate the use of medical cannabis.

The Utah Medical Cannabis Act (the “Act”) passed in 2018 contained, among other things, antidiscrimination provisions protecting public employees. Under the Act, state and political subdivision employees cannot be discriminated against on the basis of their use of medical cannabis, as long as they are otherwise in compliance with the law. The law was, however, previously silent as to whether private employers would also be obligated to accommodate or tolerate medical cannabis use by applicants or employees.

Senate Bill 121, signed into law by Governor Gary Herbert on February 28, 2020, amends the law to make it clear that private employers are not required to accommodate the use of medical cannabis. The new provision states: Nothing in this section requires a private employer to accommodate the use of medical cannabis or affects the ability of a private employer to have policies restricting the use of medical cannabis by applicants or employees. According to the Utah Department of Health, this means that “Private employees are subject to their employers’ policies, which may include zero-tolerance for cannabis and/or drug testing.” Senate Bill 121 also amended the law to amend the scope of the protections for public sector marijuana users. The law now provides that “[a] state or political subdivision employee who has a valid medical cannabis card is not subject to adverse action … for failing a drug test due to marijuana or tetrahydrocannabinol without evidence that the employee was impaired or otherwise adversely affected in the employee’s job performance due to the use of medical cannabis.” However, the protection for public employees does not apply where the use of medical cannabis would jeopardize federal funding, a federal security clearance, or any other federal background determination required for the employee’s position, or if the employee’s position is dependent on a license that is subject to federal regulations.

The obligation for public employers to accommodate the use of medical cannabis in Utah differs from current federal law. Although the Americans with Disabilities Act (ADA) requires employers to make reasonable accommodations for qualified employees with a disability, the ADA does not protect or require accommodation of illegal drug use. Although the ADA protects status-based discrimination against drug-dependent individuals in recovery, marijuana is still an illegal drug under federal law with no exception for medical use recognized under the ADA.

Key Takeaways

Private employers in Utah now definitively know that they are under no legal obligation to accommodate employee use of medical cannabis, either at the workplace or away from work. Employers that do not intend to accommodate the use of medical marijuana are advised to clearly communicate their policies so employees are aware that the use of marijuana, medical or otherwise, violates company policy. Be aware that employees who ask about medical cannabis may also have underlying disabilities that may qualify them for reasonable accommodations in addition to or other than the ability to use marijuana and marijuana products. Regardless of the choice each employer makes, managers and HR professionals should be prepared to answer questions about the company policy on medical marijuana and to engage in the interactive process with employees who raise questions about the policy due to a disability. Employers are encouraged to consult with counsel in drafting and implementing these policies and procedures.


City of San Francisco to Provide Paid Sick Leave for Private Sector Workers Impacted by COVID-19

On March 16, 2020, San Francisco Mayor London Breed announced the Workers and Families First Program, which will provide paid sick leave to private-sector workers who have been impacted by the COVID-19 pandemic. The plan includes $10 million in public funding that will provide businesses and nonprofits with financial assistance to provide an additional five days of sick leave pay to workers beyond their existing policies.

All San Francisco businesses will be eligible, with up to 20% of funds reserved for small businesses with 50 or fewer employees. The City will contribute up to one week (40 hours) at the city’s minimum wage of $15.59 per hour per employee, or $623 per employee. The employer will be responsible for paying the difference between the minimum wage and an employee’s hourly wage.

This program will provide funds if 1) the employee has exhausted his or her currently available sick leave, 2) the employee has exhausted or is not eligible for federal or state supplemental sick leave, and 3) the employer agrees to extend sick leave beyond current benefits. The program is available pursuant to San Francisco’s Paid Sick Leave Ordinance and the guidance issued by San Francisco’s Office of Labor Standards Enforcement (OLSE) on March 9, 2020, or any subsequent guidance released by OLSE, including when employees are:


  • Sick,
  • Self-quarantined to prevent spread,
  • Caring for a sick family member,
  • Home because of a temporary work closure in response to a public official’s recommendation, or
  • Caring for a child who is home because of school/daycare closures in response to a public official’s recommendation.


The news release from the Office of the Mayor can be found here: Office of the Mayor of San Francisco


A coalition of businesses has asked the California Attorney General to delay enforcement of the California Consumer Privacy Act (CCPA) in light of the strain that COVID-19 is putting on businesses.

The CCPA, which took effect on January 1, 2020, allows the Attorney General to begin enforcement actions on July 1, 2020. The coalition urges the Attorney General to delay the enforcement date arguing that “[d]eveloping innovative business procedures to comply with brand-new legal requirements is a formidable undertaking on its own, but it is an especially tall order when there is no dedicated, on-site staff available to build and test necessary new systems and processes.” The coalition also points to the ongoing revisions to the draft regulations which complicate compliance efforts even further. Click here to read more.


Court Cases

The Ninth Circuit Has Spoken, Again: Salary History Cannot Be Used to Justify Pay Differentials

Just as it did in 2018, the Ninth Circuit disagreed with the county’s position, holding that prior salary alone or in combination with other factors cannot justify a wage differential. On April 9, 2018, the eve of Equal Pay Day, the United States Court of Appeals for the Ninth Circuit in Rizo v. Fresno County Office of Education held that under the Equal Pay Act, prior rate of pay is not a “factor other than sex” and only job-related factors may serve as affirmative defenses to Equal Pay Act claims. However, in late February 2019, the United States Supreme Court vacated that decision and directed the Ninth Circuit to reconsider the issue because the opinion had been published days after the death of its author, the late Judge Stephen Reinhardt. On February 27, 2020, nearly two years after the Ninth Circuit’s initial decision in Rizo, and almost one year to the date of the Supreme Court vacating the decision and remanding the case, the Ninth Circuit reached the same conclusion again.

Case Background

Aileen Rizo was hired as a math consultant by the Fresno County Office of Education in 2009. Rizo’s salary upon joining the county was determined in accordance with the county’s Standard Operating Procedure 1440 (SOP 1440), which dictates that a new hire’s salary is determined by adding 5 percent to their previous salary. Fresno County did not take experience into consideration.

In 2012, Rizo learned that her male colleagues subsequently had been hired in the same position at higher salaries. Rizo complained about the disparity and was told by the county that all salaries had been set in accordance with SOP 1440. Rizo filed suit, alleging that such a system violates the Equal Pay Act.

The county argued it was justified in paying Rizo less than comparable male employees for the same work because the discrepancy was based on her prior salary. In relevant part, the Equal Pay Act provides that employers can pay men and women differently for the same work only if such a payment is made pursuant to (i) a seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity, quality or production; or (iv) a differential based on any factor other than sex. The county contended that an employee’s prior salary constitutes a “factor other than sex.”

The Court’s Decision

Just as it did in 2018, the Ninth Circuit disagreed with the county’s position, holding that prior salary alone or in combination with other factors cannot justify a wage differential. Instead, the court concluded again that “’ any factor other than sex” is limited to legitimate, job-related factors such as a prospective employee’s experience, educational background, ability or prior job performance.

In the Ninth Circuit’s most recent decision, the majority acknowledged that prior pay could potentially be viewed “as a proxy” for job-related factors such as education, skills or experience related to an employee’s prior job and that prior pay can be a function of factors related to an employee’s prior job. The court held, however, that “prior pay itself is not a factor related to the work an employee is currently performing, nor is it probative of whether sex played any role in establishing an employee’s pay.”

The court explained: “The express purpose of the act was to eradicate the practice of paying women less simply because they are women. Allowing employers to escape liability by relying on employees’ prior pay would defeat the purpose of the act and perpetuate the very discrimination the EPA aims to eliminate.”

Two judges partially dissented, arguing that prior salary was a business reality and could be used in certain circumstances, but ultimately agreed that solely relying on prior pay to justify salary differentials violates the Equal Pay Act.

Implications for Employers

The Second, Eighth, Tenth and Eleventh Circuits all have reached similar conclusions that prior salary alone cannot justify a compensation disparity―consistent with the view of the dissenting judges in the Ninth Circuit’s most recent decision in Rizo. However, the Ninth Circuit’s decision has taken it a step further in its holding that prior salary alone, or in combination with other factors, cannot justify a wage differential. This holding, which ultimately would preclude employers from even considering past pay as a factor in setting initial wages, is directly at odds with the Seventh Circuit, which has held that prior salary is always a “factor other than sex.” While employers may have gotten a brief reprieve after the Supreme Court vacated the Ninth Circuit’s initial decision in early 2019, this case shows that state and federal courts in California continue the trend line of cases that construe longstanding practices in public and private sector employment as unlawful when viewed through a 2020 lens. Coupled with the various salary history ban laws that have been instituted across the country (e.g.New York City, Washington state, DelawareCaliforniaPhiladelphiaSan FranciscoMassachusetts, and Oregon), this decision emphasizes the importance of relying on job-related factors other than an individual’s past salary when determining their new pay. The decision also serves as a reminder that employers should conduct pay equity audits to ensure that any differentials have been lawfully made, are currently supportable and are lawful under the Equal Pay Act and state and local law equivalents. In conducting pay equity reviews, employers may want to work with counsel so that their review may be conducted under attorney-client privilege.

9th Circ. Pares Damages in $60M TransUnion FCRA Verdict

A Ninth Circuit panel found Thursday that a California federal jury’s $60 million awards were too high for a class of consumers who say TransUnion violated the Fair Credit Reporting Act by confusing their names with those of people on a terrorist watch list, reducing the per-member payout by about one-third.

In a published, partially split decision, the majority affirmed much of the jury’s and lower court’s findings, but knocked punitive damages from $6,353.08 per class member down to $3,936.88 per class member, noting that the 6.45-to-1 ratio between punitive damages and statutory damages was higher than the 4-to-1 benchmark. And given the high statutory award, this ratio couldn’t be justified, the panel said.
“Although TransUnion’s conduct was egregious … the jury’s compensatory award was substantial — near the high end of the statutory range,” the majority said. “Moreover, when viewed in the aggregate, $8 million in statutory damages is quite substantial.” Based on the 8,185-member class size, and the per-member reduction, the panel’s finding should knock about $20 million off the roughly $52 million punitive awards while preserving the whole of the $8 million statutory awards. The panel vacated the punitive damages, remanding it to the lower court with instructions to reduce them to $3,936.88 per member.
“This litigation has already spanned a number of years, and we do not think a new trial would bring to light any new evidence that might permit a ratio higher than 4 to 1,” the panel said. TransUnion has argued that there was no proof individual class members were injured in the same manner as named plaintiff Sergio L. Ramirez and that the award was “untethered” to the evidence. But the panel majority shot this down, despite a partial dissent from U.S. Circuit Judge M. Margaret McKeown. The jury handed up an award of $8.1 million in statutory damages and $52 million in punitive damages in June 2017 after finding TransUnion had willfully violated the FCRA by linking law-abiding consumers to similarly named criminals and terrorists in the U.S. Department of the Treasury‘s Office of Foreign Assets Control database. In the suit filed in February 2012, Ramirez said he was prevented from buying a car in 2011 because TransUnion told lenders he potentially matched two entries on the OFAC list. Ramirez said that when he tried to get off of the credit reporting agency’s list, the company’s customer service agents gave him “the runaround” and didn’t explain how the error could be corrected. The class argued that TransUnion didn’t ensure accuracy as required by the FCRA by cross-checking OFAC name hits with other results, such as birth dates. TransUnion has said there was no evidence to support the damages, arguing Ramirez was eventually able to buy the car and that 80% of the class members did not claim damages at all. The company also argued the FCRA violations weren’t willful, saying it reformed its practices after facing similar litigation over the OFAC practice. While affirming the jury’s findings as to the reasonable procedures claim, the Ninth Circuit panel found that TransUnion’s actions created risk for class members. “TransUnion — one of the nation’s largest consumer reporting agencies — made all class members’ reports available to potential creditors or employers at a moment’s notice, even without the consumers’ knowledge in some instances,” the majority said. And this is where Judge McKeown dissented, noting that such a possibility of injury doesn’t amount to material risk. “Because no evidence in the record establishes a serious likelihood of disclosure, we cannot simply presume a material risk of concrete harm,” she said. Judge McKeown spent much of the dissent noted that at trial plaintiffs’ counsel focused on Ramirez and his “unique circumstances.” “The story of the absent class members, in contrast, went largely untold,” she said. “The jury learned class members requested a credit report from TransUnion and were sent separate mailings. The trial featured no evidence that absent class members received, opened, or read the mailings, nor that they were confused, distressed, or relied on the information in any way.” Perhaps they were, she said, but no evidence was presented tying their experiences to those of Ramirez, leaving the jury to assume that the injury was the same. “Trial attorneys understand the importance of a narrative, and ‘the story of Mr. Ramirez’ has all the compelling elements: a sympathetic protagonist, a corporate antihero, and thousands of unseen victims,” she said. “The purpose of a trial, however, is to evaluate evidence, not produce a satisfying plot.”. The case is Sergio L. Ramirez v. TransUnion LLC, case number 17-17244, in the U.S. Court of Appeals for the Ninth Circuit.

Federal Circuit Courts’ Differing Interpretations of Scope and Application of Article III Standing after Spokeo Leaves Defendants with Uncertainty
In Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016), the Supreme Court held that Article III requires plaintiffs to establish a “concrete and particularized” injury-in-fact, “even in the context of a statutory violation.” Although the Supreme Court noted that “intangible” injuries, including the “violation of a procedural right”, can be sufficient in some circumstances, the Supreme Court made clear that “a bare procedural violation, divorced from any concrete harm” to the plaintiff cannot satisfy the injury-in-fact requirement. Given the limited guidance provided by the Supreme Court, the circuit courts have taken differing approaches to what constitutes an injury-in-fact that satisfies Article III standing. In particular, courts are wrestling with whether a bare violation of a statute constitutes a concrete injury under Article III. Courts have taken different approaches when looking at whether a statute itself creates a protected interest that relieves the need to show any additional harm or injury. The differing approaches make it difficult for defendants to predict whether a plaintiff’s lawsuit may survive a Rule 12 attack.

No Article III Standing with Bare Statutory Violation: The Sixth, Seventh, and Eleventh Circuits have found that bare violations of certain consumer protection statutes did not constitute injuries under Article III. In Huff v. Telecheck Services, Inc., the plaintiff filed a putative class action alleging violation of the Fair Credit Reporting Act (“FCRA”) because Telecheck provided him an incomplete report of its records about his check-writing history and accounts. 923 F.3d 458, 461-62 (6th Cir. 2019). In that case, the Sixth Circuit held that the plaintiff could not satisfy his Article III standing requirement because the alleged statutory violation did not harm the plaintiff’s interests under FCRA since there were no adverse consequences. Id. at 466. The Court reasoned that “Congress cannot conjure standing by declaring something harmful that is not, by saying anything causes injury because the legislature says it causes injury.” Id. at 465.

Similarly, in Casillas v. Madison Avenue Associates, Inc., the Seventh Circuit found that the plaintiff had not satisfied her Article III standing requirements with a Fair Debt Collection Practices Act (“FDCPA”) claim. 926 F.3d 329, 331 (7th Cir. 2019). There, the plaintiff brought a putative class action predicated on allegations that the debt-collection letter violated the FDCPA because it failed to disclose that the plaintiff “had to communicate in writing to trigger the statutory protections” to verify her debt. The Seventh Circuit held that because the plaintiff did not allege that “she tried to dispute or verify her debt orally and therefore lost or risked losing the statutory protections,” the defendant’s “mistake didn’t put [plaintiff] in harm’s way, [so] it was nothing more than a ‘bare procedural violation.’” Id. at 334. This was not sufficient to establish Article III standing.

Along similar lines, in Salcedo v. Hannathe plaintiff filed a putative class action under the Telephone Consumer Protection Act (“TCPA”) based upon receipt of a single unsolicited text message. 936 F.3d 1162, 1165 (11th Cir. 2019). The Eleventh Circuit found that single unsolicited text message did not satisfy Article III’s injury-in-fact requirement, noting that “an act of Congress that creates a statutory right and a private right of action to sue does not automatically create standing.” Id. at 1167.

Article III Standing with Bare Statutory Violation: The Second, Third, Fourth, and Ninth Circuits have taken a different approach, and have found Article III standing can be satisfied even with bare procedural violations by focusing on the underlying language in the statute created a protected interest. The Ninth Circuit initially led the charge in Van Patten v. Vertical Fitness Group, LLCfinding that a violation of the TCPA, standing alone, categorically causes concrete injury sufficient for Article III standing. 847 F.3d 1037, 1043 (9th Cir. 2017). This conclusion was based on the finding that “Congress identified unsolicited contact [under the TCPA] as concrete harm.” Id. at 1043.

The Third Circuit followed suit. In Susinno v. Work Out World Inc., the Third Circuit found that a “single prerecorded telephone call” under the TCPA was sufficient to confer Article III standing. 862 F.3d 346, 351-52 (3d Cir. 2017). Then, the Second Circuit adopted both Van Patten and Susinno. In Melito v. Experian Marketing Solutions, Inc., the Court concluded that the “receipt of the unsolicited text messages [under the TCPA], sans any other injury”, was sufficiently concrete to establish standing. 923 F.3d 85, 88 (2d Cir. 2019).

Finally and most recently in Krakauer v. Dish Network, L.L.C.the Fourth Circuit again considered whether a bare violation of the TCPA’s private right of action in a putative class action satisfies Article III’s standing requirement. 925 F.3d 643 (4th Cir. 2019). Consistent with the Second, Third, and Ninth Circuits, the Fourth Circuit concluded that the TCPA’s private right of action, by itself, “plainly satisfies the demands of Article III.” Id. at 653. It reasoned that receipt of a call on a residential line that the called party “previously took steps to avoid,” (i.e. by listing it on the Do Not Call Registry) imposes a “concrete burden on his privacy” that is sufficient to confer standing.

On December 16, 2019, the Supreme Court denied Dish Network’s petition for certiorari. By declining the take, the appeal, the Supreme Court leaves unresolved for now this growing circuit split on whether a bare procedural violation under various consumer protection statutes constitutes an injury-in-fact under Article III. Until this split is resolved, defendants should stay vigilant in assessing Article III standing, and consider which circuit the case arises in to determine whether a bare violation of a particular statute is sufficient for Article III standing.


New Jersey Medical Marijuana User May Proceed with Discrimination Claim

The New Jersey Supreme Court affirmed an appellate court ruling allowing a medical marijuana user to proceed with his disability discrimination claim under the New Jersey Law Against Discrimination (“LAD”). Wild v. Carriage Funeral Holdings, Inc., No. 082836 (Mar. 10, 2020).

The plaintiff, a cancer patient and lawful user of medical marijuana, was involved in a motor vehicle accident while at work. He told a hospital physician that he possessed a license to use medical marijuana; however, the physician decided not to order a drug test because “it was clear” that the plaintiff was not under the influence of marijuana at that time. The plaintiff subsequently was required to submit to drug testing by his employer before returning to work. The employer claimed it terminated the plaintiff’s employment due to his failure to disclose his lawful use of marijuana, not the positive drug test result.

The plaintiff filed a suit alleging disability discrimination and failure to accommodate under the LAD. At that time, the state medical marijuana law (Compassionate Use Medical Marijuana Act, “CUMMA”) did not provide employment protections to users of medical marijuana.

The trial court granted the employer’s motion to dismiss after determining that the CUMMA “does not contain employment-related protections for licensed users of medical marijuana.” But the Appellate Division reversed, as we discussed in our earlier blog post, Medical Marijuana Users May Not Be Discriminated Against In New Jersey. After that decision, the CUMMA was amended expressly to prohibit employers from taking adverse employment actions against a medical marijuana user if that adverse employment action is “based solely on the employee’s status” as a medical marijuana patient. See our article on the amendment, New Jersey Amends Medical Marijuana Law to Provide Job Protections, Include Drug Testing Procedures.

The New Jersey Supreme Court affirmed the Appellate Division’s ruling, concluding that the plaintiff stated a LAD claim that was sufficient to survive a motion to dismiss. Specifically, the plaintiff’s discrimination claims “derived in part from [the plaintiff’s] assertion that, outside the workplace, he lawfully used medical marijuana” for medical reasons, that is, to treat the symptoms of his cancer. Moreover, there is no conflict between the CUMMA and the LAD, although there are two provisions of the CUMMA that could affect a plaintiff’s claim in certain settings, specifically: (1) the CUMMA does not require an employer to accommodate an employee’s use of medical marijuana in the workplace; and (2) CUMMA does not require an employer to permit any person to “operate, navigate or be in actual physical control of any vehicle, aircraft, railroad train, stationary heavy equipment or vessel while under the influence of marijuana.”

The Court’s decision reminds employers to ensure company policies and protocols regarding medical marijuana meet the requirements in the CUMMA (now known as the Jake Honig Compassionate Use Medical Cannabis Act). More importantly, this case serves as a caution to employers that regardless of the language in a state’s medical marijuana statute, a plaintiff may assert a disability discrimination claim in connection with their disability and related use of medical marijuana. Proper policies, compliant protocols, and training for management and human resources professionals are recommended to avoid potential claims.


International Developments

Countries and regions have enacted extensive travel restrictions in an effort to curb the spread of COVID-19. 

The European Union (EU) has banned all nonessential travel into Europe for at least 30 days. There are exemptions for long-term residents of the EU, health care workers, and the transport of goods. Meanwhile, the U.S. State Department has issued a Level 4 travel advisory that advises U.S. citizens to avoid all international travel and asks U.S. citizens abroad to arrange for an immediate return to the U.S. or risk being forced to remain outside the United States for an indefinite timeframe. And, the United States has reached agreements with both Canada and Mexico to limit travel across their respective borders to “essential travel.” Click here and here and here to read more.

Countries are using location data collected from individuals’ mobile phones to monitor the spread of COVID-19. 

Israel, China, and South Korea are all using mobile data to track the movements of individuals who have tested positive for the coronavirus and to monitor those with whom they have been in contact. In what appears to be a more privacy-conscious approach, the U.S. government is in talks with Facebook, Google, and other tech companies to use aggregated anonymized location information to help health authorities determine the impact of social distancing, without sharing data about any individual’s location, movement, or contacts. Click here and click here to read more.


Other Developments

Coronavirus: An Employer’s Action Guide

As the coronavirus continues to spread, employers should continually evaluate whether their prevention and response efforts are sufficient and appropriately tailored based on the latest information on the virus and their own business considerations. Here is our latest guidance, which may further inform your own response plan.

This is a follow up to our posts on March 4, 2020 and February 14, 2020. Our full Employer’s Action Guide can be found here.

What degree of coronavirus exposure should cause employers to send employees home or deny visitors access to our worksite, and for how long should site access restrictions remain in place?

This is very much a judgment call. The nearly limitless variety of scenarios that may occur makes it difficult to establish clear and objective rules to follow in assessing reported situations.

Exposure may occur due to personal contact or through surface contamination, although the CDC advises that close personal contact is the greatest risk. In either case, exposure may be firsthand or of a second or third-degree — i.e., via contact with a person who had recent close personal contact with someone diagnosed with coronavirus, or with a person who has had recent contact with another person diagnosed with coronavirus, etc.

Some employers are requiring employees and visitors with up to second-degree exposures to remain offsite until the transmission threat is mitigated. We have seen few employers sending people home with lesser degrees of exposure. If the only known exposure is via potential surface contamination, employers often restrict worksite access only if the exposure was firsthand.

Much depends on how disruptive it is to operations if high numbers of employees may work only remotely, if at all. Some businesses can manage under such an arrangement, but others such as manufacturers, health care providers, and warehouse operations require a mostly-onsite workforce to function. For them, the primary strategy is likely to be mitigation (reducing exposure risks for workers onsite) rather than containment (removing known and even potential exposure sources from the worksite).

Employers adopting a mitigation strategy for business reasons are focusing more and more on sending home only employees with symptoms consistent with coronavirus, such as fever of 100.4 degrees or more, coughing or shortness of breath, and possibly also those with recent Level 3 country or cruise ship travel.

As to the period of time to require someone to remain offsite, the latest Centers for Disease Control and Prevention (CDC) guidance indicates that symptoms may not appear for two to 14 days after exposure, so many employers are following the more conservative 14-day time frame.

Can a company ask its employees to submit health declaration forms that provide personal data — for instance, whether they are experiencing symptoms and have traveled to, or been in close contact with persons who have traveled to, regions affected by the novel coronavirus?

Yes, those specific questions are permissible given the level of threat (severity and apparent ease of transmission) of this particular virus. For symptoms, it should be limited to asking if they are experiencing any of the symptoms associated with COVID-19, i.e., coughing, fever of 100.4 degrees or above or shortness of breath. (That is based on the CDC’s latest guidance, which should be monitored for potential updating). We recommend limiting the inquiry to activities or symptoms within the last 14 days, which seems to be the best available information about when transmission may occur. Medical inquiries that go beyond this should be further reviewed to determine whether they are permissible under the Americans with Disabilities Act (ADA). Under the California Consumer Privacy Act (CCPA), those employees residing in California should be provided notice, explaining the categories of personal information collected and the purposes for which the information was collected.

Can employers force employees to come to work, even if there is a known exposure-potential situation?

Currently, yes, employers can generally require employees to continue working their scheduled hours as assigned, onsite, as a condition of continued employment, with absences addressed under the applicable attendance policy. If the employee cites a medical impairment that could qualify as a disability as the reason for the reluctance to come to work, the employer should follow the ADA’s interactive process to determine whether a remote work arrangement or some time off work in hopes that the risk level will soon be alleviated would be a reasonable form of accommodation.

Before issuing an ultimatum, however, we recommend communication to employees about what the employer is doing to mitigate the risk to the extent reasonably possible. This may allay fears enough that the employee will be willing to meet attendance expectations.

In situations of known potential exposure, can employers require employees to be tested for coronavirus?

No. Only health care providers can order testing, and with tests still in short supply, even individuals with symptoms consistent with coronavirus may not be tested if, based on age and medical condition, it is unlikely they would suffer severe effects even if infected.

Based on CDC advice that older people, as well as those with serious chronic medical conditions, stay home as much as possible if coronavirus is spreading in their communities, should employers require all employees age 60 or older to work remotely (if at all) in areas where coronavirus cases are being reported?

We do not recommend taking that action based on federal, state and local protections against age discrimination as well as disability discrimination laws intended to provide equal employment opportunities to the disabled. These disability discrimination laws generally do not allow employers to remove employees from situations based on a medical condition for preventive purposes unless and until the situation poses a direct that to the employee’s health and safety that cannot be effectively alleviated through other measures. Circumstances could conceivably rise to that level at some point, but as things stand now, presence in most workplaces would not rise to that “direct threat” standard.

May and should employers revise paid sick time policies to allow for “quarantine” situations?

Many employers are offering relaxed and/or additional paid leave benefits in response to the current situation. Most common is allowing the use of paid sick time to cover time off work due to restrictions against coming onsite for coronavirus prevention purposes. Paid sick time may also be allowed for other coronavirus-related reasons for absence, such as the need to care for children whose schools are closed — and keep in mind that some states, such as New York, require a minimum amount of paid time off each year that may be used for such a purpose. Some employers are simply paying for “quarantine time” separately from any existing paid time off policies, but that is not always feasible, especially given the uncertainty about the potential total cost at a time when revenues may be down. Some employers are considering adopting “leave-sharing” programs to allow employees to donate a portion of their paid time off to coworkers who are off work for extended periods due to the coronavirus. Because leave-sharing programs can be complex to administer, and if not properly designed, donor employees may be subject to payroll taxes on donated leave, we advise consulting benefits counsel before adopting such a program.

How may employers incentivize employees who are working long hours to cover for absent colleagues?

We are seeing a variety of incentives including some “bonus” paid time off to be used once the absence rate is back to normal, and monetary incentives such as a certain dollar amount or percent of pay for people working over a certain number of hours in a workweek. Do keep in mind that monetary incentives paid to non-exempt employees should be taken into account in calculating the regular rate for purposes of calculating overtime payments due, per requirements of the Fair Labor Standards Act. State law requirements may also apply.

If an employee contracts coronavirus through exposure at work, would that be treated as a workers’ compensation claim?

Likely not. Typically, workers’ compensation covers occupational diseases that are contracted or aggravated due to the nature of a particular kind of work — for example, a hospital worker who gets stuck by a needle and contracts a disease. Illnesses transmitted among workers would generally not be covered. State workers’ compensation laws differ, however, so it is a good idea to consult your workers’ compensation insurance carrier for guidance.

COVID-19: DOL Reminds Employers of Their Duties Under the FMLA, ADA, and FLSA

In addition to guidance given to employers by the Occupational Health and Safety Administration, the U.S. Department of Labor’s Wage & Hour Division (WHD) issued several reminders to employers regarding their duties under the Family and Medical Leave Act (FMLA), Americans with Disabilities Act (ADA), and Fair Labor Standards Act (FLSA) in the wake of the COVID-19 pandemic outbreak, addressing topics such as:


  • Circumstances in which FMLA coverage and protection would be available for employees who have contracted COVID-19 or who are caring for family members that have contracted COVID-19;
  • Whether employees can use FMLA leave to avoid exposure to COVID-19. Even if they cannot, be attuned to potential ADA obligations;
  • Use of paid sick leave when available;
  • Revising paid sick leave policies to address work shortages or financial issues;
  • Preventing abuse of leave;
  • Whether employers can require employees who are out sick with COVID-19 to provide a doctor’s note, submit to a medical exam, or perform a self-quarantine;
  • The use of “volunteers” or temporary employees in the event a business has a shortage of workers;
  • Whether employers can require salaried, exempt employees to take a vacation or unpaid leave during an office closure resulting from the COVID-19 pandemic without impacting the employees’ exempt status;
  • Use of teleworking and FLSA-related issues; and
  • An employer’s FLSA-related obligations to employees under government-imposed quarantine.


More information is available on the WHD’s website:

Additionally, the World Health Organization (WHO) has declared COVID-19 to be a global pandemic. That declaration reflects the spread of the disease, not its severity. However, it is a first step toward allowing employers greater flexibility in monitoring employees for symptoms of COVID-19. Equal Employment Opportunity Commission guidance states that when a pandemic is declared by WHO and the Centers for Disease Control and Prevention, employers in areas of a widespread outbreak may take additional measures, such as taking employees’ temperatures, in order to reduce the spread of the disease in the workplace.


Will traditional business insurance policies apply to claims related to the Coronavirus?

In the coming weeks and months, we expect to see a lot of discussions, and ultimately litigation, concerning the interpretation of insurance policy provisions and whether Coronavirus-related claims will be covered. We expect to see both first-party claims and third-party claims. A number of publications have recently suggested that it is unlikely that coverage will apply under many traditional policies. Nonetheless, insureds should not assume that suggestion to be true for their policies and should not make any statements concerning the possible inapplicability of coverage. Ultimately, determinations will likely be made in the courtroom if coverage is denied by the insurer. It is important to analyze your policies closely because the language within policies can differ, the interpretation of policy language is usually controlled by state law (which can vary widely), and coverage is often fact-dependent.

First-Party Policies

First-party policies concern losses suffered by your business. Sometimes these are described as commercial property or all-risk policies, depending on the scope of coverage. They are mostly known for covering damage to your property, but can also include coverage for additional losses, which might be relevant to the Coronavirus outbreak. These policies might include the following relevant coverages:

Business Interruption

Business Interruption provides coverage for lost income and extra expenses incurred in attempting to continue your business operation following a covered loss. Many policies require the interruption to be caused by a direct physical loss or damage to your property. For instance, if your business cannot operate because a fire destroyed your property, you might be afforded coverage for lost income while you rebuild.

Litigation under these policy provisions is likely to turn on whether (1) the Coronavirus has caused a physical loss or damage to your property and (2) whether such physical loss or damage is a direct cause of your business’s interruption.

Perhaps a hotel or restaurant that is contaminated with the virus might meet the test for having physical loss or damage to its property and receive coverage for the short period of time while disinfecting takes place, but the fact that most businesses are currently experiencing a downturn while customers practice social-distancing is unlikely to trigger coverage.

Experts seem to think that the most prominent argument will be that insureds’ HVAC systems were “damaged” by the presence and spread of respiratory droplets containing the virus.

Contingent Business Interruption and Supply Chain

Contingent Business Interruption and Supply Chain provide coverage for lost income and extra expenses when a supplier or customer experiences a loss that disrupts their supply chain. Many Contingent Business Interruption policies will limit coverage to instances where a direct customer or supplier has suffered a physical loss or damage to its property within a specific geographic area. Supply Chain policies can be a variation of CBI by covering specific products or specific suppliers during certain events, such as a pandemic or civil action.

Ingress and Egress

Ingress/Egress provides coverage for the business interruption that arises when you cannot come and go from your property. Imagine, for example, that the only road to your warehouse is closed. This type of policy may contain a mileage limit. The policy language may or may not require damage to your property. If current government bans expand in scope, this type of coverage may gain importance for Coronavirus claims.

Civil Authority

Civil Authority provides coverage for the business interruption that arises from “civil authority” orders. This coverage typically requires government action that impairs or prevents access to an insured’s property as a result of physical damage to property at or nearby the insured’s location. Although recent government orders have shut down restaurants and bars, it is unlikely that those orders will trigger this coverage without satisfying the property damage element.

Event Cancellation

Event Cancellation is designed to protect against expenses and lost revenue from the cancellation of an event that is beyond the insured’s control, such as hurricanes, terrorism, labor strikes, or the non-appearance of a celebrity. These policies can be written to cover all events during a policy period or specific events. Some policies permit optional coverage for an additional expense to cover communicable/infectious diseases. Reports indicate that there was a growth in the purchase of this type of coverage following the SARs outbreak, but it has declined recently.

Liability (Third-Party) Policies

Commercial General Liability Policies (“CGL”)

CGL policies cover claims for bodily injury or property damage brought by a third-party. Importantly, they often include coverage for costs to defend claims, including attorneys’ fees. Therefore, these may be the first line of defense against Coronavirus claims if a third-party alleges that a business’s negligence caused them bodily injury. We have already seen the filing of at least one lawsuit claiming a million dollars in damage due to a cruise ship company’s negligence in dealing with the Coronavirus outbreak.

Coverage will depend on whether contracting the Coronavirus is considered an “occurrence” within the policy. An occurrence is usually defined as an accident. The question has been argued in courts for decades with various results. With respect to the Coronavirus, the answer will likely turn on whether the insured foresaw that the claimant would contract the virus — which could be hard to defend against if certain businesses remained open after the recent government guidance and forced closures to prevent the spread of the virus. Notably, some of these policies are written on a “claims made” or “claims made and reported” basis, which seek to impose limitations on when and how many claims may be asserted. In addition, the scope of coverage can depend on whether the policy is written to allow claims “because of” or “for” bodily injury/property damage.

It is important for companies to make sure that they comply with all notice requirements and other conditions within their policy so as to not waive coverage.

Directors & Officers Liability Policies

As described, these policies are designed to protect against claims concerning how directors and officers acted or failed to act. Potential claims against directors and officers are expected to vary widely concerning the Coronavirus, but will likely include suits brought by shareholders alleging that these individuals failed to act reasonably in anticipating and/or responding to the impacts of the Coronavirus. Such claims might be made based on a business’s decision to remain open, inadequate precautions, reporting errors, inaccurate or inadequate disclosures, or failure to comply with government orders.

Errors & Omissions Liability Policies

These policies typically cover claims alleging that professionals made errors and/or omissions in rendering services. Illegal acts and purposeful wrongdoing are typically excluded. These claims might come into the discussion concerning how medical professionals, accountants, and universities responded to the Coronavirus.


It is important to note that coverage may be disclaimed under some or all of these policy provisions based on specific policy language. Some policies contain exclusions under general terms, such as for losses caused by viruses, communicable/infectious diseases, bacteria, mold, fungi, spores, any microorganism that causes harm to human health, contamination, pollution, government quarantine, and pandemics. Some policies contain exclusions on a more specific basis, such as for losses caused by SARs, Ebola, or Zika. We may see disputes as to whether there is a difference between bacteria-borne illnesses and viral infections under exclusion language. It is important to review your policy language.

Other Considerations

It has recently been reported that certain legislative bodies are seeking to enact legislation to retroactively apply insurance coverage to Coronavirus claims, despite exclusions for viruses. Whether such legislation will become law and whether it will ultimately be challenged by insurers in court remain to be seen.


  1. Do not assume that coverage will be disclaimed under your policies.
  2. Do not make statements concerning the inapplicability of coverage.
  3. Review your policy language for coverage and exclusions.
  4. Provide timely notices to your insurer and fulfill all conditions of your policies to prevent a waiver of coverage.
  5. Document your losses, such as lost profit.


New Partnership is First Facilities Management Contract for ClearStar

More than ever, businesses need to boost their processes and streamline operations, but it must be achieved without sacrificing the safety and security of their efforts­ or the privacy of their people, especially in the world of healthcare. To this end, a large facilities management company recently asked ClearStar to apply our proven solutions in background screening to roll out a new element of their healthcare facilities management operations.


The private client handles facilities management for more than 120,000 locations and across a variety of industries. In February, ClearStar was contracted to provide solutions specific to their healthcare facilities in support of a new security measure which will require service providers to clear background screens and carry virtual IDs for facility access. The tightened security protocols will be rolled out this year.


Though this particular contract–worth more than $400,000 per year–is the first partnership between ClearStar and a facilities management organization, the services ClearStar provides are well vetted. The healthcare industry, naturally, requires stiff compliance with employment, security, and privacy regulations in all aspects of its operations. Our experience in all of these areas, along with our special attention to candidate care, makes ClearStar uniquely qualified to streamline this important element of our new client partner’s operations.


From ongoing efforts serving clients in the home healthcare arena to the provision of general occupational health screening services for employers in all industries all around the world, ClearStar has developed a deep understanding of what’s important to this very personal, always changing business sector on which all of our lives ultimately depend.


If you’re a healthcare or healthcare-related business, ask ClearStar how we can apply the same accuracy, attention to detail, and customer service to your hiring, security, and personnel management needs.

Trends in HR: Tobacco Use Policies & Employee Rights

Smoking bans started becoming the norm in the United States more than 25 years ago when California first banned smoking in all enclosed workplaces on Jan. 1, 1995. Today, except for the occasional bar, casino, or private venue, no one expects to find anyone smoking tobacco indoors­–or even in the vicinity of a building’s sidewalks or main doors.


In fact, smoking bans have been in effect long enough that designated smoking areas have become a film and TV cliché. [Cut to an outdoor shot of workers on a smoke break, huddling near the receiving platform conversing.] But even that now-classic scene may be on its way to the cutting room floor forever as employers launch nicotine-free hiring policies where the law says they can.


Why Does Off-the-Clock Tobacco Use Matter?


Obviously, banning smoking on-the-clock­–or even during the workday–encourages worker productivity and workplace safety. But what’s the benefit of refusing to hire smokers who smoke on their own time, away from their workplaces?


It’s simply about the bottom line. Increasing productivity and cutting costs make that line stronger. Employees who are non-smokers tend to be healthier than those who smoke. Healthier employees not only produce more work, but they also command lower healthcare premiums and, ideally, lower healthcare costs throughout their tenures as employees.


Employee Rights and Tobacco Use Policies

Tobacco users are not a protected class under any federal anti-discrimination laws. So, if an employer’s state and local jurisdictions don’t consider smokers as a protected class either, it’s welcome to adopt a nicotine-free hiring policy.

Some areas do have laws protecting tobacco use as “lawful” and forbidding discrimination based on it. But questions do come in to play in jurisdictions where privacy laws may prevent employers from making inquiries about tobacco use. Of course, it’s perfectly legal to encourage employees toward making healthier choices. Incentivizing employees to break their nicotine habits may lead to similar results with an added bonus­–a stronger employer/employee relationship that’s based on care rather than rules.

Regardless of how your business may wish to curb tobacco use, Ask ClearStar how we can help you recruit and hire the best candidates for your needs with our fast, easy, and comprehensive tools like ScreenMeNow and ClearMD–mobile applications for screening a modern workforce.

Ban the Box Signed into Law at the Federal Level

The Ban the Box civil rights campaign that began in the 1990s finally broke through at the federal level when President Trump signed The Fair Chance Act into law as part of the National Defense Authorization Act for Fiscal Year 2020 on December 20, 2019. When the Act goes into effect December 20, 2021, it will become illegal for the federal government and its contractors to request disclosure of past criminal convictions by potential employees on their job applications or otherwise seeking out that information prior to a conditional offer of employment–except for certain instances.

Most employers and recruiters should already be aware of the laws that affect, or could soon affect, their specific hiring processes because at the time the Act was signed, 35 states and more than 150 cities/counties had already passed Ban the Box laws of some kind. Plus, in 2015, President Barack Obama mandated the Office of Personnel Management to “ban the box” from all federal job applications. In essence, the Act now makes that mandate into law and lengthens its reach to include federal contractors, too.

Exceptions to Federal Ban the Box Regulations

Of course, there are some circumstances under which it makes sense that the Act will not apply. Requests for criminal history disclosures can still be made:

  • Where the law requires criminal background checks;
  • Where “an individual hired under the contract to access classified information or to have sensitive law enforcement or national security duties”; and
  • Other regulations to be identified and issued by the Office of Personnel Management no later than April 2021.

The Fair Chance Act as Law

Prior to the Act going into effect, the Office of Personnel Management will have established a formal complaint process for job applicants who experience violations of the law as well as penalties for violators. Businesses need to be ahead of the law and prepared to comply in their background screens, application, interviews and other processes well before the Act become law.

In order to ensure compliance with any and all Ban the Box laws currently–or soon to be–in effect, employers and recruiters can Ask ClearStar to manage their hiring processes. ClearStar teams stay on top of these ever-changing regulations so businesses can have confidence that their hires are unquestionably the best available and the most qualified after a fair and legal application process.

Privacy Considerations for US Employers Dealing with COVID-19

Employers are currently working to protect their workforces against COVID-19. Efforts might include employee and visitor screening activities including taking vital signs or body temperature through a hand-held thermometer or a scan for temperature. Are those screening activities lawful under applicable privacy and confidentiality laws in the US and are there obligations to inform other employees or health authorities?

HIPAA & Covered Entity Disclosure
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) imposes restrictions on disclosures of protected health information on the workforce of a covered entity (health care providers, health plans and health care clearinghouses in the United State) and their services providers (business associates). HIPAA’s Privacy Rule does not apply to the collection, use, or disclosures of individually identifiable health information made by an employer in the context of worksite COVID-19 screening activities that is paid by the employer.

The Office for Civil Rights of the US Department of Health and Human Services, which enforces HIPAA, has released helpful guidance on COVID-19-related uses and disclosures (See ). Under HIPAA, Covered Entity health care providers may disclose PHI about individuals who are suspected of having contracted COVID-19 to public health authorities that are authorized by law to receive such information for preventing or controlling the spread of disease. “Public health authorities” include agencies or authorities of the United States government, a State, a territory, a political subdivision of a State or territory, or Indian tribe that is responsible for public health matters as part of its official mandate, as well as a person or entity acting under a grant of authority from, or under a contract with, a public health agency. Under HIPAA, health care providers may also, at the direction of a public health authority, disclose PHI to a foreign government agency. Some states have mandatory legal requirements to report infectious disease cases, such as COVID-19, to state or local public health authorities.

Generic State Medical Confidentiality Laws
Several states have enacted generic medical confidentiality laws; however, those laws generally do not restrict worksite screening activities. For example, in California, the Confidentiality of Medical Records Act generally restricts the disclosure of medical information without first obtaining authorization, which is subject to numerous statutory exceptions. However, an employer performing worksite screening activities generally falls outside the scope of the definition of medical information under the Act. Another example is the state of Texas where the Medical Record Privacy Act imposes similar restrictions on medical information. However, the Act specifically exempts an “employer” from its scope.

The Illinois Biometric Information Privacy Act (BIPA) restricts the collection, use, or other processing of biometric identifiers by entities, unless certain requirements are met. In the context of an employer performing COVID-19 worksite screening activities seeking to obtain body temperature through a hand-held thermometer or a scan for temperature, BIPA should not apply because the term “biometric identifier” generally refers to “retina or iris scan, fingerprint, voiceprint, or scan of hand or face geometry.”

Except under limited circumstances, employers should not disclose the identity of an employee suspected of having or diagnosed with coronavirus. Under the Americans with Disabilities Act, 42 USC § 12101 et seq. (ADA), employee medical information must be kept confidential and may only be shared in very limited circumstances. Information could be confidential even if it contains no medical diagnosis or treatment course, and even if it is not generated by a health care professional. For example, an employee’s request for a reasonable accommodation for COVID-19 treatment or recovery may be considered medical information subject to the ADA’s confidentiality requirements.
In an employment context, the employer should make every effort to protect the medical confidentiality of the individual while still providing sufficient information to the workplace for them to take appropriate steps. In almost every case, this can be done without sharing the name of the person who was infected.
In a company-wide notice, an employer should:

• Send a general communication reporting that there has been a suspected/confirmed case of coronavirus in the workplace and urging employees to be vigilant in observing for symptoms and stay away from the office if symptoms occur and consult with a medical provider.
• Note how the company is taking all appropriate steps to manage the situation in accordance with official guidance.
• Refer employees to guidance materials provided by public health agencies, including the Centers for Disease Control and Prevention (CDC).
• Designate individuals and provide contact information for employees to direct questions/concerns (preferably HR or a similar role).

ADA places restrictions on the inquiries that an employer can make into an employee’s medical status, and the EEOC considers taking an employee’s temperature to be a “medical examination” under the ADA (see ). The ADA prohibits employers from requiring medical examinations and making disability-related inquiries unless (1) the employer can show that the inquiry or exam is job-related and consistent with business necessity, or (2) the employer has a reasonable belief that the employee poses a “direct threat” to the health or safety of the individual or others that cannot otherwise be eliminated or reduced by reasonable accommodation.
Taking an employee’s temperature may be unlawful if it is not job-related and consistent with business necessity. The inquiry and evaluation into whether taking a temperature is job-related and consistent with business necessity is fact-specific and will vary among employers and situations. The EEOC’s position during a pandemic is that employers should rely on the latest CDC and state or local public health assessments to determine whether the pandemic rises to the level of a “direct threat” (see The assessment by the CDC as to the severity of COVID-19 will provide the objective evidence needed for a medical examination. If COVID-19 coronavirus becomes widespread in the community, as determined by state or local health authorities or the CDC, then employers may take an employee’s temperature at work. However, as a practical matter, an employee may be infected with the COVID-19 coronavirus without exhibiting recognized symptoms such as a fever, so temperature checks may not be the most effective method for protecting your workforce. The extent and frequency of any medical examinations in the context of COVID-19 worksite screening, and the mandatory or voluntary nature of those activities should carefully be discussed with legal counsel.

Regulatory Guidance for Employers
In an Interim Guidance for Businesses and Employers, The Centers for Disease Control and Prevention states that: “If an employee is confirmed to have COVID-19, employers should inform fellow employees of their possible exposure to COVID-19 in the workplace but maintain confidentiality as required by the Americans with Disabilities Act (ADA).” The CDC recommends that employers take the following steps at the workplace:

• Separate sick employees. If upon arrival to work, an employee becomes sick, separate that employee from others, and send them home immediately. This includes visitors and other non-employees.
• Actively encourage sick employees to stay home, and not return to the workplace until they are free of fever (100.4° F [37.8° C] or greater using an oral thermometer), signs of a fever, and any other symptoms for at least 24 hours, without the use of fever-reducing or other symptom-altering medicines (e.g. cough suppressants).
• Do not require a healthcare provider’s note for employees who are sick with acute respiratory illness to validate their illness or to return to work. This is because healthcare provider offices and medical facilities may be extremely busy, and unavailable to provide documentation in a timely way.
• Review and be prepared to follow a “Business Infectious Disease Outbreak Response Plan” based on the present condition in each worksite.
• Coordinating with state and local health officials is strongly encouraged. Since the intensity of an outbreak may differ according to geographic location, local health officials will be issuing guidance specific to their communities.

For more information on the Interim Guidance for Businesses and Employers issued by the CDC, please see This is for the record.


For The Public Record is a monthly blog featuring thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process. Click here to subscribe.

SAP® SuccessFactors® Recruiting + ClearStar Background Check Integration Continues to Deliver a Better Candidate Experience, Lighten Workload for Recruiters

Our partnership with SAP SuccessFactors improves the recruiting and onboarding process for recruiters, candidates, and data teams alike.


A year into our partnership with SAP® SuccessFactors® Recruiting, ClearStar Background Check integration continues to serve thousands of clients around the globe with streamlined processes and unmatched candidate care.


Historically, employee recruiting efforts are labor-intensive for agencies, human resources departments, and department managers. In 2019, to give the industry its first “touchless” digital tool for recruiting and onboarding processes, ClearStar and SAP combined efforts with the goal of relieving recruiters of common repetitive tasks. And, we did it without depersonalizing the experience for candidates.


The marriage of SAP® SuccessFactors® Recruiting with ScreenMeNow and ClearID by ClearStar offloads many person-to-person touchpoints from recruiters and puts the power of screening task management directly into the hands of the candidates via highly secure and personalized email and mobile communications. Paperwork and time investments are reduced for recruiters and candidates alike and both parties receive actionable digital updates, guidance, and results every step of the way. Employers and candidates are never left in the dark about the next steps. The next steps don’t get dropped or lost in the shuffle. And everyone benefits from an efficient hiring experience.


Benefits Beyond a Better Workload


Everyone benefits greatly from fewer day-to-day tasks, but ClearStar offers more than automation. As an industry leader for background screens, ClearStar boasts an international team that’s always on top of the latest governmental and industry compliance requirements. We also know just how to access the most complete and up-to-date data on candidates from nearly anywhere in the world. Businesses that use SAP® SuccessFactors® Recruiting with ClearStar Background check integration never have to worry about breaking data privacy laws, connecting to old data providers, or missing out on background information they didn’t know was available.


If your HR team is ready to boost efficiency and get access to the world-class knowledge base, ask ClearStar how our partnership with SAP can add convenience, security, and results to your recruiting efforts.

ClearStar Boosts Client Success by Integrating SAP Technology with Mobile Solutions, Qualifies for 2020 Innovation Awards

Thanks to our SAP partnership and ongoing success as a leading provider of technology-based services for background and medical screening, ClearStar has become the first background screening company to qualify for the SAP Innovation Awards. Now in their seventh year, the SAP Innovation Awards celebrates the companies and individuals who are using SAP products to transform business and drive innovation.


Intelligent Integrations for Efficiency, Accuracy, and Cost Reductions


By integrating SAP intelligent technologies with our applicant background check software solutions, ClearStar has improved time-to-hire for global job applicants at our client companies in the retail sector­–a business category known for the costly problem of high employee turnover. With the initial goal of boosting the efficiency of tasks related to applicant background screening and employee onboarding, ClearStar applied SAP SuccessFactors Recruiting intelligence to our mobile ScreenMeNow app and reduced time-to-hire processing by 50% for our client companies. And that’s not the only result of our combined efforts.


The SuccessFactors and ScreenMeNow integration also . . .

  • reduced client costs by consolidating global background screen vendors.
  • improved accuracy by ensuring the correct country forms are delivered to each applicant.
  • maintained global legal and GDPR compliance through AI and robotic process automation of records requests.
  • eliminated ongoing client IT involvement by establishing a single data integration point.
  • optimized the applicant experience with uniform branding throughout the screening process.


Ask ClearStar how our innovative background screening solutions can simplify HR processes for your team. And watch for the SAP Innovation Awards 2020 winners to be announced Mar. 18, 2020.

February 2020 Screening Compliance Update

Federal Developments

DOT Office of Drug and Alcohol Policy and Compliance Notice
The Agricultural Improvement Act of 2018, Pub. L. 115-334, (Farm Bill) removed hemp from the definition of marijuana under the Controlled Substances Act.  Under the Farm Bill, hemp-derived products containing a concentration of up to 0.3% tetrahydrocannabinol (THC) are not controlled substances.  THC is the primary psychoactive component of marijuana.  Any product, including “Cannabidiol” (CBD) products, with a concentration of more than 0.3% THC remains classified as marijuana, a Schedule I drug under the Controlled Substances Act. We have had inquiries about whether the Department of Transportation-regulated safety-sensitive employees can use CBD products.  Safety-sensitive employees who are subject to drug testing specified under 49 CFR part 40 (Part 40) include pilots, school bus drivers, truck drivers, train engineers, transit vehicle operators, aircraft maintenance personnel, fire-armed transit security personnel, ship captains, and pipeline emergency response personnel, among others.  It is important for all employers and safety-sensitive employees to know:


  1. The Department of Transportation requires testing for marijuana and not CBD.
  2. The labeling of many CBD products may be misleading because the products could contain higher levels of THC than the product label states. The Food and Drug Administration (FDA) does not currently certify the levels of THC in CBD products, so there is no federal oversight to ensure that the labels are accurate. The FDA has cautioned the public that: “Consumers should beware purchasing and using any [CBD] products.”  The FDA has stated: “It is currently illegal to market CBD by adding it to a food or labeling it as a dietary supplement.”  Also, the FDA has issued several warning letters to companies because their products contained more CBD than indicated on the product label.
  3. The Department of Transportation’s Drug and Alcohol Testing Regulation, Part 40, does not authorize the use of Schedule I drugs, including marijuana, for any reason. Furthermore, CBD use is not a legitimate medical explanation for a laboratory-confirmed marijuana positive result. Therefore, Medical Review Officers will verify a drug test confirmed at the appropriate cutoffs as positive, even if an employee claims they only used a CBD product.


It remains unacceptable for any safety-sensitive employee subject to the Department of Transportation’s drug testing regulations to use marijuana.  Since the use of CBD products could lead to a positive drug test result, the Department of Transportation-regulated safety-sensitive employees should exercise caution when considering whether to use CBD products.



U.S. Citizenship and Immigration Services (USCIS) published a new version of the Form I-9. 
The new Form I-9 is dated 10/21/2019. Employers should begin using this updated version as of January 31, 2020, however, they may continue to use the prior version (dated 7/17/2017 N) until April 30, 2020. After April 30, 2020, only, the new version can be used. Minor updates were made to the Form I-9 to reflect changes in country names. Minor updates were also made to the Form I-9 Instructions, including clarification of who can act as an authorized representative on behalf of an employer, clarification of acceptable documents for the Form I-9, and updates to the process for requesting paper Forms I-9. Click here to access the new Form I-9 and Instructions.


The International Trade Administration’s Privacy Shield Team has provided updated guidance on how an EU-U.S. Privacy Shield participant may receive personal data from the United Kingdom in light of Brexit. 
The guidance states that during the Transition Period from January 31, 2020, until December 31, 2020, EU law will continue to apply to data received from the UK. However, by December 31, 2020, a participant must update its public commitment to comply with the Privacy Shield to include personal data received from the UK in reliance on the Privacy Shield. The guidance provides model language for this update. In addition, a participant must maintain the current Privacy-Shield certification. After December 31, 2020, participants will be understood to have committed to comply with the UK Information Commissioner’s Office (ICO) with regard to personal data received from the UK. Click here to access the guidance.


FMCSA Drug/Alcohol Clearinghouse Rule Applies to Canadian Cross-Border Motor Carrier Employers
All Canadian employers who employ commercial drivers must now be aware of new requirements for those employees operating commercial vehicles in the United States.

As of January 6, 2020, the Federal Motor Carrier Safety Administration (“FMCSA”), operating under the Department of Transportation (DOT), has instituted new reporting requirements for all FMCSA-regulated motor carriers employing commercial motor vehicle drivers, including Canadian carriers carrying out cross-border operations. These drivers include, but are not limited to:

  • Interstate and intrastate motor carriers, including passenger carriers;
  • School bus drivers;
  • Construction equipment operators;
  • Limousine drivers;
  • Municipal vehicle drivers (e.g., waste management vehicles); and,
  • Federal and other organizations that employ drivers subject to FMCSA drug and alcohol testing regulations (e.g., Department of Defense, municipalities, school districts)

Employers of these individuals must now report all drug and alcohol violations of their drivers directly to the new Drug and Alcohol Clearinghouse (the “Clearinghouse”). According to the Clearinghouse, its purpose is to enable “employers to identify drivers who commit a drug and alcohol program violation while working for one employer, but who fail to subsequently inform another employer (as required by current regulations).”

In stark contrast to Canadian law, where drug and alcohol reporting requirements are governed provincially (save for Criminal Code violations), the Clearinghouse is nationwide. By way of comparison, one common tool utilized by Canadian employers is to request one of a number of background checks (e.g. Criminal Record Check, Criminal Record, and Judicial Matters Check, Vulnerable Sector Records Check, Credit Check, etc.). Yet, these background checks may not be proper in all cases and are limited in their scope. Therefore, where a Canadian employer utilizes an American based driver in any State, the employer must follow the process as described by the Clearinghouse.

Canadian employers utilizing American drivers or those who operate out of the United States should consider reviewing their current drug and alcohol policies to identify efficiencies that could be gained or gaps that require attention. This may be particularly difficult for Canadian employers as they must balance workplace safety and obligations under relevant health and safety legislation, an employee’s right to privacy, human rights considerations and potential circumstances regarding the need for accommodation.


State Developments

New Amendment to the PA Background Check Requirements for Employees Who Have Contact with Children
Effective December 31, 2019, Pennsylvania amended section 6344(m) of the Child Protective Services Law (CPSL), which pertains to background checks for employees who have contact with children. Specifically, the amendment prohibits employers, administrators, supervisors or other persons responsible for employment decisions from employing applicants on a provisional basis absent a waiver from the department. Child day-care centers, group day-care homes or family child-care homes may apply for a one-time extension not to exceed 45 days only if the following conditions are met.

  • The applicant has applied for the information required under section 6344 (b) and the applicant provides a copy of the appropriate completed request forms to the employer, administrator, supervisor or another person responsible for employment decisions.
  • The employer, administrator, supervisor or another person responsible for employment decisions has no knowledge of information pertaining to the applicant that would disqualify him or her from employment pursuant to section 6344 (c).
  • The applicant swears or affirms in writing that he or she is not disqualified from employment pursuant to section 6344(c) or has not been convicted of an offense similar in nature to those crimes listed in section 6344(c) under the laws or former laws of the United States or one of its territories or possessions, another state, the District of Columbia, the Commonwealth of Puerto Rico or a foreign nation, or under a former law of this Commonwealth.

Prior to the recent amendment, section 6344 of the CPSL, among other things, allowed employers, administrators, supervisors or other persons responsible for employment decisions to employ applicants on a provisional basis not to exceed 90 days.


Maryland Bans the Box
Over Governor Larry Hogan’s veto, the Maryland General Assembly recently enacted legislation to prohibit employers from initially seeking job applicants’ criminal records. Maryland now joins 13 states and the District of Columbia that mandate removing criminal history questions from job applications for private employers. These states are California, Colorado, Connecticut, Hawaii, Illinois, Massachusetts, Minnesota, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, and Washington. At least 18 cities and counties across the country have also extended these requirements to private employers.

Effective January 1, 2020, Maryland employers may not, at any time before the first in-person interview, require an applicant to disclose whether he or she has a “criminal record” or has been the subject of criminal accusations. An employer may require the applicant to disclose that information during the first in-person interview. An employer is prohibited from retaliating or discriminating against an applicant or employee who complains of a violation of the law. “Criminal record” is broadly defined to include an arrest, a plea or verdict of guilt, a plea of no contest, marking a charge “stet” on the docket, a disposition of probation before judgment, or disposition of not criminally responsible. The law only applies to employers of 15 or more full-time employees, which includes contractual, temporary, seasonal, and contingent workers. Further, the law does not prohibit an employer from inquiring into an applicant’s criminal record or taking action the employer is required or authorized to take in accordance with federal or state law. The law also does not apply to employers that provide programs, services, or direct care to minors or vulnerable adults.

The State Labor Commissioner is responsible for investigating violations of this law. If the Commissioner determines an employer has violated the law, the Commissioner may assess a civil penalty of up to $300 for each aggrieved applicant or employee. The Commissioner must consider the gravity of the violations, the size of the employer’s business, the employer’s good faith, and the employer’s history similar violations in assessing the amount of the penalty. The law does not preempt local jurisdictions from enacting their own, more stringent ban-the-box laws. Such laws currently exist in Baltimore, Montgomery County, and Prince George’s County.


Los Angeles County DA & Code for America Announces Dismissal of 66,000 Marijuana Convictions
On February 13, 2020, the Los Angeles County DA & Code for America Announces Dismissal of 66,000 Marijuana Convictions, marking the completion of five-county clear my record pilot.


The City of Oakland, California has enacted an ordinance banning criminal background checks for rental housing. 
Other cities in California have passed similar ordinances which are limited to rentals for affordable or subsidized housing. The Oakland ordinance applies more broadly to nearly all rental housing, with a few exemptions including for rental property occupied in part by the owner and for certain sexual offenders. Click here to read more.                    AGG Compliance News Flash – February 21, 2020


The California Consumer Privacy Act (CCPA) data broker registry is live
The CCPA requires data brokers to have registered with the California Attorney General by January 31, 2020. The website of the Office of the Attorney General provides that a data broker that has not registered by the January 31st deadline should register as soon as possible and maybe liable for civil penalties for each day it fails to register. The CCPA defines “data broker” as “a business that knowingly collects and sells to third parties the personal information of a consumer with whom the business does not have a direct relationship.” There are exceptions to this definition for consumer reporting agencies to the extent the activities are covered by the Fair Credit Reporting Act (FCRA), and financial institutions to the extent the activities are covered by the Gramm-Leach-Bliley Act (GLBA).                                                                                          AGG Compliance News Flash – February 21, 2020


Illinois Residents File Class Action against Biometrics Company for Collecting Information without Consent
Two Illinois residents filed a class action Complaint in the U.S. District Court for the Southern District of New York against a biometrics company and its company’s licensing agent for gathering biometrics identifiers and information without informed consent. The plaintiffs alleged that Clearview AI, Inc. and CDW Government LLC violated Illinois’ Biometric Information Privacy Act (BIPA) by actively collecting, storing and using biometrics, in addition to those of most of the residents of Illinois, without receiving the appropriate informed consent. As cited in the Complaint, the Illinois legislature states that:

“[b]biometrics . . . are biologically unique to the individual; therefore, once compromised, the individual has no recourse, is at heightened risk for identity theft, and is likely to withdraw from biometrics facilitated transactions.” The plaintiffs stated that Clearview created a facial recognition tool using a database of approximately three billion photographs that Clearview built from scraping sources including Instagram, Twitter, YouTube, Facebook and Venmo. According to the plaintiffs, the facial recognition tool was designed to allow a user to identify virtually anyone by uploading a photograph and then be able to instantly see photos of the person on various social media platforms. The Plaintiffs also alleged that Clearview licensed its facial recognition tool to “hundreds of law enforcement agencies”. The plaintiffs are seeking to represent residents of Illinois whose biometric identifiers were collected by Clearview over the past five years.


Court Cases

Facebook has agreed to pay $550 million to settle a privacy lawsuit alleging violations of the Illinois Biometric Information Privacy Act (BIPA). 
Under BIPA, companies must obtain explicit permission before collecting biometric data, such as face scans, from consumers. BIPA includes a private right of action which allows Illinois consumers to sue companies directly. In this case, the plaintiffs alleged that Facebook ran afoul of BIPA by using facial recognition technology to identify and automatically tag users. This settlement comes a week after Facebook’s petition for certiorari was denied by the Supreme Court. It is being called the largest privacy class action cash settlement to date. Click here to read more.


Walgreens to pay $7.5M in settlement over phony pharmacist
Walgreens will pay $7.5 million to settle with California authorities after an employee was criminally charged with impersonating a pharmacist and illegally filling more than 745,000 prescriptions in the San Francisco Bay Area. Kim Thien Le has pleaded not guilty to felony impersonation charges. Prosecutors said that from late 2006 through 2017, Le used the license numbers of registered pharmacists in order to impersonate them and dispense prescriptions at Walgreens stores in Santa Clara and Alameda counties.

The prescriptions allegedly included more than 100,000 for opioids such as fentanyl, morphine, and codeine.

Le herself didn’t have a pharmacist license, prosecutors said. The district attorneys in both counties filed a consumer protection action against Walgreens. Prosecutors on Monday announced that the pharmacy giant agreed to settle. The company will pay $7.5 million in penalties, costs, and remedial payments.

“The burden is on the company to make sure its employees are properly licensed and to complete a thorough background check,” Alameda County District Attorney Nancy O’Malley said in a news release announcing the settlement. In a statement Monday, Walgreens said Le hasn’t worked for the company since 2017.

“Pharmacy quality and safety are top priorities, and upon learning of this issue, we undertook a re-verification of the licenses of all our pharmacists nationwide,” the statement said.

The complaint alleged Walgreens failed to vet Le thoroughly when it promoted her to positions requiring a license and failed to make sure that its internal systems were strong enough to prevent an employee from evading them.


Philadelphia Salary Inquiry Ban Upheld by Third Circuit
In 2017, Philadelphia became the first city to prohibit private employers from inquiring about a job applicant’s wage history and from relying on an applicant’s wage history in setting his or her salary. Since then, approximately 17 states and 20 cities have enacted similar bans. Philadelphia’s ban, however, was embroiled in litigation since its enactment.

The Chamber of Commerce of Greater Philadelphia sued the city arguing that the inquiry and reliance provisions violated the First Amendment’s free speech clause. In 2018, a federal district court upheld the ordinance’s prohibition on employers relying upon wage history but held that the prohibition on employers inquiring about wage history was unconstitutional. On February 6, 2020, the Third Circuit Court of Appeals reversed the district court and held that the prohibition on salary inquiries was constitutional.

The Philadelphia ordinance makes it an unlawful employment practice for an employer or employment agency to “inquire” about or “rely” upon an applicant’s wage history. Thus, employers may not:

  • Inquire about an applicant’s wage history, require disclosure of wage history, or condition employment or consideration for an interview or employment on disclosing wage history. “Inquire” means asking a job applicant in writing or otherwise; “wages” means all earnings of an employee (by time, task, piece, commission, or other methods of calculation) and includes fringe benefits, wage supplements, or other compensation.
  • Rely on the wage history of an applicant from any current or former employer of the individual in determining his or her wages at any stage in the employment process, including the negotiation or drafting of any employment contract, unless such applicant knowingly and willingly disclosed his or her wage history.
  • Retaliate against an applicant employee for exercising his or her rights under the ordinance.

However, the ordinance does not apply to any actions taken by an employer or employment agency under any federal, state or local law that specifically authorizes the disclosure or verification of wage history for employment purposes. Given the Third Circuit’s ruling, the full ordinance is now effective.


Other Developments

Genetic Information under HIPAA
Genetic Information is quickly becoming an important part of our lives. The Health Insurance Portability and Accountability Act of 1996, as amended, and the final Privacy Rule (HIPAA) are implicated by a healthcare provider’s or benefit plan’s creation, storage, and use of Genetic Information. Although HIPAA was enacted in 1996, and the final Privacy Rule was promulgated in 2003, it was not until 2008 that these laws and regulations were amended to ensure that Genetic Information was to be treated as Health Information protected by HIPAA.[4] These amendments included the addition of five key defined terms that confirm the scope of Genetic Information and the many individuals whose Genetic Information is protected under HIPAA, and to allow consistency with the defined terms adopted under the Genetic Information Nondiscrimination Act of 2007 (GINA)[5] adopted a year before, in 2007. Today, as a result, HIPAA includes definitions for the following terms: (1) Individual; (2) Genetic Information; (3) Genetic Test; (4) Genetic Services; and (5) Family Member.

  • “Individual” means the person who is the subject of protected health information or PHI under HIPAA.
  • “Genetic Information” includes specific information about a particular Individual and the Individual’s Family Members in regard to their genetic test information, the manifestation of a disease or disorder in Family Members of the Individual, or any request for, or receipt of, Genetic Services by the Individual or any Family Member of the individual. The term also includes any Genetic Information of a fetus carried by the Individual or Family Member who is a pregnant woman and any embryo legally held by an Individual or Family Member utilizing an assisted reproductive technology. For purposes of this definition, the term Genetic Information excludes information about the sex or age of any Individual.
  • “Genetic Test” means an analysis of human DNA, RNA, chromosomes, proteins, or metabolites, if the analysis detects genotypes, mutations, or chromosomal changes. The term Genetic Test does not include an analysis of proteins or metabolites that is directly related to a manifested disease, disorder, or pathological condition.
  • “Genetic services” means a Genetic Test, genetic counseling (including obtaining, interpreting or assessing Genetic Information), or genetic education.
  • “Family Member” means, with respect to the Individual:
    • A Dependent of the Individual; or
    • Any person who is a first-degree (parents, spouses, siblings and children), second-degree (grandparents, grandchildren, aunts, uncles, nephews, nieces), third-degree (great-grandparents, great-grandchildren, great aunts, great uncles, and first cousins), or fourth-degree (great-great-grandparents, great-great-grandchildren, and children of first cousins) relative of the Individual or of a Dependent of the Individual.
    • The definition also notes that relatives by affinity, such as by marriage or adoption, are treated the same as relatives by consanguinity, that is, relatives who share a common biological ancestor. In determining the degree of the relationship, relatives by less than full consanguinity (such as half-siblings, who share only one parent) are treated the same as relatives by full consanguinity (such as siblings who share both parents).

In summary, HIPAA defines Health Information to include Genetic Information. Second, HIPAA provides five important definitions that confirm (1) the scope of the Genetic Information that is protected, (2) the categories of Individuals, Dependents and other Family Members whose Genetic Information is protected, and (3) a detailed definition of what qualifies as Genetic Tests and Genetic Services as they are conducted by health care providers. Third, this overview is an important first step in confirming the impact that HIPAA has on Genetic Information, as it is created or received and maintained by HIPAA Covered Entities in the delivery of health care services today.


Must an Employer Pay for Medical Marijuana?
Apparently yes – at least in New Jersey. In Hager v. M&K Construction, a New Jersey state appellate court recently affirmed a workers’ compensation judge’s order for an employer to reimburse a former employee for his use of medical marijuana for chronic pain following a work-related accident.

Case Background

In 2001, the employee severely injured his back in a work-related accident. Over the course of the next 15 years, he underwent multiple unsuccessful surgeries and was prescribed a slew of opioid pain medications.

In April 2016, the employee was experiencing side effects from his use of opioids and wanted an alternative. His doctor provided him with an authorization for medical marijuana. During a follow-up appointment with his doctor in May 2016, the employee reported that medical marijuana had provided some relief for his incessant pain and he had stopped taking opioids. He continues to treat his pain with two ounces of medical marijuana per month, as authorized by his doctor, for which he pays $616 a month out-of-pocket.

At the trial for his workers’ compensation claim, the judge found that the present condition of the employee’s back was causally related to his long-ago accident at work and that the employee exhibited permanent partial total disability. Doctors for both the employer and employee “agreed that the treatment of pain with opioids carried a risk of death and that opioids were significantly more addictive than marijuana.” The judge concluded that medical marijuana was the “clearly indicated option.” The judge ordered the employer to reimburse the employee for the costs of medical marijuana and any related expenses. A shocked employer appealed, arguing that the federal Controlled Substances Act (“CSA”), which makes it a crime to manufacture, possess, or distribute marijuana, preempted the New Jersey Compassionate Use Medical Marijuana Act (in July 2019, the Act was amended to the “Jake Honig Compassionate Use Medical Cannabis Act”) because it was impossible to comply with both laws.

The Court’s Decision

Addressing this issue for the first time, the New Jersey appellate court found that there was no conflict between the CSA and the Jake Honig Act because an employer’s reimbursement of a registered patient’s use of medical marijuana does not require the employer to violate the CSA, as it does not manufacture, possess or distribute marijuana. The court also rejected the employer’s argument that it would be aiding and abetting the employee in a commission of a crime – the possession of marijuana – if it reimbursed him for medical marijuana as ordered by the judge. The court found that the employer is not an active participant in the commission of a crime because it would be complying with an order requiring it to reimburse the employee for the legal use of medical marijuana under New Jersey law. In addition, the court rejected the employer’s argument that compliance with the order exposes it to the threat of federal prosecution for aiding and abetting the employee in the possession of marijuana. The court noted that the employer could not point to any federal prosecution against an employer or insurance carrier for its reimbursement of authorized medical marijuana treatment. The court further rejected the employer’s argument that the judge failed to consider whether medical marijuana can be a reasonable and necessary form of treatment under the state’s Workers’ Compensation Act because it is illegal under the CSA. The court cited to the doctors’ testimony and found that the judge weighed the “alternative legal modalities of treatment” available to the employee.

Notably, the court found that the employee’s use of medical marijuana allowed him to cease using opioids, and stated, “That achievement, by itself, in light of the opioid crisis in existence today, should suffice as a rationale for the reimbursement of medical marijuana.” (Interesting that the solution to one illegally used substance is another one. The lesser of two evils, it appears.)


It is unclear if the case will be appealed. However, this ruling is in line with New Jersey’s recent amendment to the Jake Honig Act, which, among other things, now expressly prohibits an employer from taking any adverse action against a medical marijuana user if the adverse employment action is “based solely on the employee’s status” as a medical marijuana patient. We must wait to see if other states will follow this court’s example with regard to requiring an employer to reimburse for medical marijuana.

HR Pros are the Most Stressed, Says New Report

A recent report says HR is the most stressful job of all. Can stressed-out HR pros find some balance at the office?

According to a new study, HR professionals experience the most stress on the job­–more than workers in any other field. The report by the Chartered Institute of Personnel and Development (CIPD), names constant multi-tasking plus the frequent discussions of negative issues related to employees and then the pressure of finding solutions to them as the culprits. People problems, systems problems, ongoing administrative tasks… Where does it end?


Find Partners for Efficiency


Though CIPD reported that 79% of HR pros felt negatively impacted by their jobs, it also reported that 62% of them claimed their workloads were “unmanageable.” The stress of dealing with unhappy coworkers and other personnel issues is variable from day to day–if not hour to hour–so it requires HR pros to have some professional and emotional availability at all times. Is it even possible to successfully handle that plus the dynamics of managing processes, training, policies and more?


The solution may be to find ways of streamlining as many other tasks and processes as possible. Mobile technology and the internet make it possible to outsource what can be some of the most highly-detailed, labor-intensive tasks for the HR pro: initiate background and drug screening and day-to-day labor management. ClearStar offers a number of mobile solutions that offer efficiencies while keeping privacy and administration in the hands of HR.  Collecting data directly from job candidates and sharing the detail work of task management directly with only those that are required to know. The ClearStar suite of mobile apps includes tools like:

  • ClearMD for drug screening and clinical testing.
  • ScreenMeNow for candidate engagement and collection of data.
  • ClearID for identity validation.
  • ClearContact for casual labor management.


Ask ClearStar how any of all of these industry-leading solutions can put mobile technology to work so HR pros can boost efficiency for the whole office and reduce their own stress.

Continuous Background Screening for Ongoing Security

To most workers, background screening has been considered a one and done hoop to jump through after an offer of employment has been made. Accept the job, pass the background screen, and then go back to being mostly unnoticed and never again having your life examined as long as you stay with the same employer.


Screening only at hire and never again can create ongoing risks for employers. Not only could a worker with a squeaky-clean background when hired accumulate a questionable record later, but an important record that wasn’t available during the initial screen can become available soon after. Implementing continuous background screening can reduce risks by following up for these unexpected changes in behavior and information availability.


Real-Time Monitoring for Real-Time Security


Thanks to the internet technology and data availability, businesses can address employee security concerns by monitoring employee records continuously throughout their employment or contract periods. Because law enforcement, motor vehicle department, credit, education, and professional licensure records–and more–are available online and updated regularly, continuous background screening can be an employer’s 24/7 partner for post-hire screening that delivers alerts as soon as a potential issue arises.


Continuous background screening presents a tremendous amount of security benefits, but there are some risks. Partnering with an experienced, background screening company that has the most up-to-date technology and legal knowledge is likely the most-efficient way to ensure balance. Not only can ClearStar help with Fair Credit Reporting Act compliance and monitoring employee consent for ongoing screens, but we are also experienced with the technology required to acquire comprehensive data and prepared to assure your employees that their personal data is secure throughout our low-stress screening experience.


Ask ClearStar how our fast, easy, and comprehensive continuous background screening solutions can reduce employee risk in your business.

ClearStar Wins First Contract in Facilities Management Sector

ClearStar (AIM: CLSU), a provider of Human Capital Integrity℠ technology-based services specializing in the background and medical screening, announces that it has been appointed by a leading facilities management company to provide background screening of service providers entering its healthcare locations. This is ClearStar’s first contract in the facilities management sector and the Company expects it to generate a minimum revenue of $0.4m during the roll-out phase this year.


The customer provides facilities management and maintenance to leading brands across North America, with over 120,000 locations under management, in a range of industries. It helps manage facilities through its technology solutions and a substantial network of service providers. ClearStar has been appointed to provide background screening for the customer’s new program that requires all service providers to its healthcare facilities to undergo a background check and maintain a virtual ID card.


The virtual ID card incorporates the relevant information from the background screen thanks to ClearStar’s integration with the provider, Virtual Badge. The integration can also allow for continuous screening monitoring, with a badge becoming automatically suspended should the employee commit a predefined offense.


Robert Vale, CEO of ClearStar, said: “This is another fantastic customer win for ClearStar, reflecting the continuing upscaling of our client base with the increasing recognition of our brand. It marks a milestone as our first contract in the facilities management industry, which is an area with great growth potential. We help ensure the safety of the workplace by verifying the individuals who are entering, which is particularly relevant when it involves a large number of external service providers. We also have the opportunity to cross-sell further solutions to these service providers who will already be on-boarded to our platform. In addition, this contract expands our footprint within healthcare – and adds to a number of wins or expansions that we have recently received in this core sector. As a result, it has been an encouraging start to 2020 and we remain excited about the opportunities ahead.”

Move Over PTO—How VTO Can Help You Retain Employees and Boost Your Brand

You probably already know that PTO (Paid Time Off) can be an enticing benefit for attracting and retaining talent. But what about VTO or Volunteer Time Off? The practice of allowing employees to give back to the community on company time is rising in popularity—recent estimates say around 25% of all companies now offer VTO as an employee benefit. Why? Well, in addition to giving your company brand a competitive edge with millennial candidates, 75% of which expect their employer to participate in social good, companies are also finding success with reducing employee turnover. Gas South, an Atlanta-based natural gas provider, launched a volunteer program and within a year, employee attrition decreased from 27% to 19%.

ClearStar offers all employees two fully-paid VTO days per year to be used how that employee best sees fit. These VTO days can be spent at a local food bank, school, or in a recent case at ClearStar, helping the earthquake-stricken island of Puerto Rico.

I would like to introduce you to Johanna Alduen, who is an MRO Assistant in our MIS office. She joined ClearStar almost 2 ½ years ago and is a valuable member of our team. Being originally from Puerto Rico and with many family members and friends still living there, recent events on the island have been personal for her. Since last December, there have been over 100 earthquakes of a magnitude three or higher in Puerto Rico (six were over five). These, coupled with the ongoing efforts to recover from Hurricanes Maria and Irma, have taken a devastating toll.

So, Johanna decided to take her two VTO days and travel back to Puerto Rico to help out. I asked Johanna to share her story with us, and of course, some pictures:

Why did you want to go to Puerto Rico and volunteer your time?
I was born and raised in Puerto Rico, and even though I have been living in the U.S. for 21 years, the fact remains that the island is home. My parents and 90% of my family live there, on the west side. For the past six years, I have been working closely with our culture and folklore, and that also creates a strong bond and sense of commitment to our community.

What was the worst thing you saw when you were there?
Despair—that was the worst thing to see. People in fear of sleeping inside their homes. I saw devastation, destroyed homes, tents in front of houses, entire families living in makeshift shelter on their carports or simply in tents set on the dirt, cooking outside, and sharing a portable toilet.

What was the best thing you saw when you were there?
Resilience, hope, unity, tons of volunteers helping in their own way with a set of skills unique to them. Community brigades helping to rebuild, cultural centers providing spaces for collection of first necessity items and helping distribute them to specific places with specific needs. One of the things that really amazed me was how people were not taking advantage of the situation to acquire things they did not need. I would stop at a tent in front of a house and they would ask me what supplies I had, determine if they needed it or not, and point to another place that might need the things that I had.

When do you think it will be rebuilt and ‘back to normal’?
I am not certain when this will happen. With the recent devastation of the hurricanes and now this, it might take some years to build up a safer and better system to handle emergencies like these.

How can people help?
Colectivo Umoja has been working hard since day one and organizing donation drives in Puerto Rico. This is run by a great friend and fellow artist Julie Laporte. There are lots of people in need in the remote areas of south Puerto Rico. 

If you would like to help, they are in need of the following:

  1. Baby formula (Ready to Drink)
  2. Diapers (Infants and Adults)
  3. Portable Gas Stoves
  4. Tarps
  5. Solar Lightbulbs
  6. Baby Wipes

If you’re a Costco or Sam’s Club member, you can have it shipped directly to: 

Colectivo Umoja
451 Atenea
Jardines de Monte Olivo
Guayama PR 00784

Here is another link to a fundraiser organized by trusted friends and musicians Sergio Rosario and Lynmarie Rivera:

We thank Johanna for sharing her story with us. It’s clear from experiences like hers that VTO can be the ultimate benefit—boosting company brand, employee satisfaction, and the good in our communities. If you are considering adding it to your benefits package, Salesforce provides some great recommendations:

  1. Help Volunteers Find Their Cause – Open a dialogue to promote volunteer opportunities and don’t limit volunteering to specific causes.
  2. Set Clear Expectations for How Work Will Be Covered – You expect your employees to organize coverage for their PTO—VTO should be no different.
  3. Promote, Promote, Promote – Getting managers involved, planning team volunteer days, and incentivizing volunteer efforts are just a few ways to instill volunteering in your company culture.

On behalf of Johanna and myself, this is for the record.

For The Public Record is a monthly blog featuring thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process. Click here to subscribe.

Technology, Transparency, and HR in 2020

It’s hard to believe that it was 21 years ago when the first BlackBerry handheld device hit the market. The release date was Jan. 19, 1999, and it wasn’t long before the BlackBerry turned the trusty Rolodex into a dusty reminder that old ways of doing business were being replaced by technology.


In the decades since, HR departments—being the hubs of all things people-related­—have learned to rely on technology for so many tasks beyond contact management. Everything from new hire recruiting to workplace security and from daily payroll budgeting to workforce needs forecasting is being done with the help of technology. As businesses head into the new ‘20s and technology has become ubiquitous for maintaining data on the workforce, HR departments need to be ahead of growing concerns about its use.


It’s All About Data and…


Reliance on data is nothing new, and it’s not particularly dependent upon technology. But, now that data and technology are nearly inseparable, they’ve created a new side effect. Expectations have evolved and HR departments need to be prepared to answer lots of questions about who they’re collecting data about, what data they’re collecting, and how that data is being used.


During this season of low unemployment in the U.S., HR departments need to remain aware that consumer/client/vendor/employee concerns are high when it comes to what businesses they support and why. Transparency now goes beyond claims of “Made in the U.S.A.” or low-price guarantees. When it comes to HR departments, in particular, transparency about data use and security could be key to recruiting the best candidates and retaining their loyalty.


Build Trustworthy Partnerships


Recruiting and hiring processes can be intimidating when applicants know they’re being subject to background screens and, essentially, having their entire lives examined by data systems and run as reports. HR departments can open doors to top talent­­—and keep them open—by partnering with trusted third-party services for those otherwise impersonal parts of the process like background screens. Connect with ClearStar and find out how our accreditations, certifications, and personalized services can boost your transparency and help you secure the best candidates.

January 2020 Screening Compliance Update

Federal Developments

New Commercial Driver’s License Drug & Alcohol Clearinghouse Requirements Took Effect January 6th, 2020
Employers regulated by the Federal Motor Carrier Safety Administration (“FMCSA”) are now subject to mandatory reporting requirements under the new Drug and Alcohol Clearinghouse (“Clearinghouse”) program mandated by the Department of Transportation (“DOT”). The Clearinghouse is an update to the Omnibus Transportation Employee Testing Act passed in 1991, which requires DOT agencies, including FMCSA, to implement drug and alcohol testing in safety sensitive workplaces. The Clearinghouse is an electronic database that grants FMCSA-regulated employers access to information about drug and alcohol violations of current and prospective employees that hold a commercial driver’s license. Additionally, the database contains information confirming whether a holder of a commercial driver’s license has completed the return-to-duty process and followed-up any testing plan to remedy his/her violation. The database was developed to create continuity and transparency in monitoring commercial driving records, and it tracks and links a holder of a commercial driver’s record from any state. The objective is to prevent a holder of commercial driver’s license who have violated the drug and alcohol DOT requirements from moving from one carrier to another without first having remedied the violation. There are no changes to the existing requirements set out in Part 40 of the Code of Federal Regulations relating to the DOT workplace drug and alcohol testing procedures. Additionally, the Clearinghouse includes violations that have occurred on or after January 6, 2020. Any violation that occurred prior to that date, and any subsequent related return to duty activity, are not included in the database and employers must continue to conduct traditional, manual inquiries with previous employers in order to comply with the 3-year timeframe requirement of § 391.23. The process will become less burdensome to employers 3 years from the effective date of the new requirements as the online database should by then fully contain the requisite commercial drivers’ records for the preceding 3-year period (Starting January 6, 2023).

Employers Requirements
Employers are now required to conduct a full query of the Clearinghouse during any pre-employment commercial driver investigation process and to conduct a limited query for every employee in its employ on an annual basis. The employee’s consent is required prior to conducting a full query. Employers are also required to report to the Clearinghouse any drug and alcohol program violations of which employers have actual knowledge and record any negative return to duty test results and the date of successful completion of a follow-up testing plan. Any violation will be recorded in the Clearinghouse for five years from the later of (i) the date of the violation determination or (ii) the date of the resolution of the return to duty process and follow-up testing plan. Employers need to review and revise their drug and alcohol policies as needed to refer to the new Clearinghouse requirements, including a sign off for employees to provide the consent required for all queries.

Ban-the-Box Law Limits Criminal Background Inquiries by Federal Contractors Beginning in December 2021
The Fair Chance Act prohibits federal contractors from inquiring about a job applicant’s criminal background in certain cases in the initial stages of the application process. The Act will go into effect on December 20, 2021.

The Act “bans the box” by prohibiting federal contractors from asking applicants applying to work in connection with federal contracts about their criminal histories until after the contractor extends a conditional job offer. It also prohibits contractors from seeking such information from other sources.

The Act was enacted as part of the annual National Defense Authorization Act on December 20, 2019.

The Act is limited in that it does not apply to job openings unrelated to federal contract work; rather, it applies only to job openings “related to work under” a federal contract.

Further, under the Act, pre-offer criminal inquiries are allowed:

  • Where criminal background checks are otherwise required by law;
  • Where “a contract … requires an individual hired under the contract to access classified information or to have sensitive law enforcement or national security duties”; and
  • In connection with other positions to be identified in regulations that will be issued no later than April 2021 (16 months after enactment of the Act).

The Act directs the Office of Personnel Management to issue regulations identifying additional positions that are exempted from the law.

The Office of Personnel Management also must establish a complaint process and progressive penalties, ranging from a written warning for a first violation to payment suspension and contract termination for subsequent violations.

Other Laws, Ordinances
Currently, and after the Act goes into effect, federal contractors may need to navigate the many state and local ban-the-box laws that may apply to them. In addition, employers should keep in mind their obligations under the Fair Credit Reporting Act if they plan to obtain criminal history reports from third-party vendors. Employers also should follow best practices, such as engaging in an individualized assessment, where appropriate, of any disclosed criminal history prior to making any employment decisions.

Ban-the-box laws affect many parts of the hiring and employment process. Employers should review and revise, if necessary, their hiring practices, application forms, checklists, policies, and procedures to ensure compliance. Employers also should provide periodic training to those involved in the recruiting and hiring processes.

FTC Finalizes Settlements with Five Companies Related to Privacy Shield Allegations
The Federal Trade Commission has finalized settlements with five companies over allegations they falsely claimed certification under the EU-U.S. Privacy Shield framework, which enables companies to transfer consumer data legally from European Union countries to the United States.

In separate actions, the FTC alleged that DCR Workforce, Inc.Thru, Inc.LotaData, Inc., and 214 Technologies, Inc. all falsely claimed in statements on their websites that they were certified under the EU-U.S. Privacy Shield framework. The FTC alleged that LotaData also falsely claimed that it was a certified participant in the Swiss-U.S. Privacy Shield framework, which establishes a data transfer process similar to the EU-U.S. Privacy Shield framework. Finally, the FTC alleged that EmpiriStat, Inc. falsely claimed it was a current participant in the Privacy Shield after allowing its certification to lapse, failed to verify annually that statements about its Privacy Shield practices were accurate, and did not affirm it would continue to apply Privacy Shield protections to personal information collected while participating in the program.

Under the settlements, all five companies are prohibited from misrepresenting their participation in the EU-U.S. Privacy Shield framework, any other privacy or data security program sponsored by the government, or any self-regulatory or standard-setting organization. EmpiriStat also is required to continue to apply the Privacy Shield protections to personal information it collected while participating in the program or return or delete the information.


State Developments

New York State Releases Guidance on Salary History Ban
New York’s salary history ban (“Law”) becomes effective today, January 6, 2020. To help employers comply with their obligations under the Law and to advise employees of their rights, the state has issued guidance (“Guidance”). The Law prohibits all New York State employers from:

  • relying on a job applicant’s wage or salary history in determining whether to offer employment to that individual or in deciding the salary to offer (except as discussed below);
  • requesting or requiring, either orally or in writing, an applicant’s or current employee’s salary history as a condition to being interviewed or considered for an offer of employment, or as a condition of employment or promotion, unless such information is required pursuant to federal, state, or local law;
  • seeking an applicant’s or employee’s wage history from a current or former employer (except as discussed below); and
  • refusing to interview, hire, or promote, or otherwise retaliating against, an applicant or current employee: (i) based upon his or her salary history, (ii) because the applicant or employee refused to provide his or her salary history, or (iii) because such individual filed a complaint with the New York Department of Labor alleging a violation of the Law.

New Guidance Provided for Employers

Current Employees
The Law is unique among other salary history bans in that it explicitly includes current employees in the restrictions noted above. The Guidance clarifies that, while employers, may not ask current employees about pay from previous jobs, employers may “consider information already in their possession for existing employees (i.e.[,] a current employee’s current salary or benefits being paid by that employer). For example, an employer may use an employee’s current salary to calculate a raise but may not ask that employee about pay from other jobs” (emphasis added). A “current employee” includes a current employee of the employer, “its parent company or a subsidiary.”

Thus, employers may consider the salary and compensation of a current employee who is applying for a new position within the same company, when deciding what compensation to offer. Employers are still prohibited, however, from using a current employee’s salary as a selection criteria in choosing to interview the candidate or provide the current employee with the new position. [1]

Voluntary Disclosures
Prior to the Guidance, it was unclear whether employers could use voluntarily provided salary history information to set compensation levels—the Law made clear only that such information could be used to “verify” its accuracy. The Guidance now clarifies that “[i]f an applicant voluntarily and without prompting discloses salary history information, the prospective employer may factor in that voluntarily disclosed information in determining the salary for that person.” The Guidance makes clear, however, that “‘optional’ salary history question[s] on a job application” will be considered prompting by the employer and are not acceptable.

The Guidance also states that employers may not rely on voluntarily disclosed salary history information “to justify a pay difference between employees of different or various protected classes who are performing substantially similar work,” as such reliance would violate the State’s Equal Pay Act. While perhaps implied, this specific prohibition is not expressly contained in that statute.

Other Clarifications
The Guidance further makes clear that “salary history information” includes “compensation and benefits” and that an “applicant” includes “part-time, seasonal and temporary workers, regardless of their immigration status.” Additionally, the Guidance expressly allows employers to inquire into an applicant’s salary expectations.

Notable Differences Between State and City Law

New York City’s salary history ban went into effect October 10, 2017. While the Law largely mirrors the City’s salary history ban, they differ in the following respects:

  • Current Employees: The New York City law applies only to applicants, not to current employees; the State Law bars salary history inquiries of both applicants and current staff seeking promotions or transfers. Employers in New York City should note that the Law controls on this issue and update their policies accordingly.
  • Information About Compensation: The Law broadly prohibits employers from seeking any information about compensation. The New York City law explicitly allows employers to ask candidates about deferred compensation or unvested equity that an applicant would have to forego in taking a new job. Similarly, under the City law’s guidance, employers are permitted to ask for the value of any counteroffers, but this is not currently permitted under the State Law or its guidance. On these issues, until further guidance is made available, the State Law will control.
  • Independent Contractors: The Law does not apply to “bona fide independent contractors, freelance workers, or other contract workers unless they are to work through an employment agency.” New York City has enacted a law that appears to extend all aspects of the City’s Human Rights Law (including the City’s salary history ban) to such workers. Thus, on this issue, City employers must follow City law.

Employers Nationwide Must SHIELD Data of New York Residents
The Act no longer covers only people and businesses who conduct business in New York; its scope now encompasses any people or businesses that own or license computerized data that includes private information of New York residents.
By March 21, 2020, all employers—not just New York employers—with private information about New York residents must be in full compliance with the new “Stop Hacks and Improve Electronic Data Security” (SHIELD) Act. The Act implements major changes in data security protections for New York residents by amending the New York General Business Law and the New York State Technology Law. While the existing statutes already provide some breach notification protections, the Act’s key updates broaden the definition of a data breach; broaden the scope of information covered under notification laws; require reasonable data security; provide standards tailored to small businesses; and broaden breach notification requirements.

Broader Definition of “Breach”
Under current New York law, a breach is defined as “unauthorized acquisition or acquisition without valid authorization of computerized data that compromises the security, confidentiality, or integrity of personal information maintained by a business.” The Act expands the law to interpret a breach to include unauthorized access or access to private information without authorization, not just acquisition. To help a business determine whether private information has been accessed, the Act lists factors including, but not limited to, “indications that the information was viewed, communicated with, used, or altered by a person without valid authorization or by an unauthorized person.”

Broader Definition of “Private Information”
Currently, the General Business Law protects “personal information,” defined as “any information concerning a natural person which, because of name, number, personal mark, or other identifier, can be used to identify such natural person.” It also protects “private information,” defined as personal information combined with any of the following data elements, when either the personal information or the data element is not encrypted, or encrypted with an encryption key that has also been acquired: (1) Social Security number; (2) driver’s license number or non-driver identification card number; or (3) account number, credit or debit card number, in combination with any required security code, access code, or password that would permit access to an individual’s financial account.”

The Act significantly expands this definition of “private information” to also protect:

  1. In combination with a personal identifier, an account, credit, or debit card number, if it is possible to use the number to access an individual’s financial account without any additional identifying information, security code, access code, or password;
  2. In combination with a personal identifier, biometric information, defined as “data generated by electronic measurements of an individual’s unique physical characteristics, such as a fingerprint, voice print, retina or iris image, or other unique physical representation or digital representation of biometric data which are used to authenticate an individual’s identity”; and
  3. A username or email address in combination with a password or security question and answer that would give access to an online account.

Imposing Data Security Requirements
The Act also creates entirely new requirements for any person or business that owns or licenses computerized data that includes the private information of New York residents to “develop, implement and maintain reasonable safeguards to protect the security, confidentiality, and integrity of the private information, including, but not limited to, disposal of data.”

A person or business is considered in compliance with the Act when they implement a data security program containing a number of detailed administrative, technical and physical safeguards enumerated in the law. These include, but are not limited to:

  • Designating one or more employees to coordinate the security program;
  • Training and managing employees in the security program practices and procedures;
  • Requiring contractual safeguards from service providers;
  • Running certain risk assessments;
  • Adjusting the security program in light of business changes or new circumstances; and
  • Disposing of private information within a reasonable amount of time after it is no longer needed for business purposes by erasing electronic media so that the information cannot be read or reconstructed.

Businesses are also considered compliant when they meet the data security requirements of other laws such as the Health Insurance Portability and Accountability Act (HIPAA) (protecting the privacy and security of certain health information), the Gramm-Leach-Bliley Act (requiring financial institutions to explain how they share and protect customers’ private information), and Health Information Technology for Economic and Clinical Health Act (HITECH Act) (widening the scope of privacy and security protections under HIPAA).

Providing Individualized Standards
For small businesses meeting any of the following criteria—fewer than 50 employees, less than $3 million in gross revenues in each of the last three fiscal years, or less than $5 million in year-end total assets—the Act contains certain relaxed data security program standards. A small business’s security program complies with the Act if it “contains reasonable administrative, technical and physical safeguards that are appropriate for the size and complexity of the small business, the nature and scope of the small business’s activities, and the sensitivity of the personal information the small business collects from or about consumers.” By contrast, all other covered businesses must implement the specified safeguards enumerated in the statute, as previously discussed, such as designating employees to coordinate the program, requiring contractual safeguards from service providers, and so forth.

Broadening Breach Notification Requirements
The Act no longer covers only people and businesses who conduct business in New York; its scope now encompasses any people or businesses that own or license computerized data that includes private information of New York residents. In the event of a breach triggering notification requirements, as identified under the Act, notification must be made to affected New York residents, in addition to the New York Attorney General, the New York Department of State, and the New York State Police. When over 5,000 residents are affected by the breach, notification must also be made to consumer reporting agencies.

Notably, notice of a breach is not required if the exposure of private information was an inadvertent disclosure by persons authorized to access private information, and the person or business reasonably determines such exposure will not likely result in misuse or harm.

While the Act does not establish a private right of action, the Attorney General may bring an action to enjoin violations of the Act and to obtain civil penalties. For violations of the reasonable safeguards requirements, courts may impose penalties of no greater than $5,000 per violation.

For knowing or reckless violations of the notification provisions, courts may impose a penalty of the greater of $5,000 or up to $20 per instance of failed notification, the latter of which is capped at $250,000. For notification provision violations that are not knowing or reckless, courts may award damages for actual costs or losses incurred by a person entitled to notice, if notice was not provided.

What This Means for Employers
Employers should act immediately and thoroughly to ensure their businesses meet the Act’s new standards. Any employer who handles data including the private information of New York residents, even if such employer does not conduct business in New York, must be in compliance with the Act.

Covered employers must adopt a breach notification policy consistent with the Act’s requirements. Additionally, among a number of other steps, employers should consult counsel to determine whether their data security programs contain the proper safeguards suited for their business as enumerated in the Act. If not already compliant pursuant to another statutory requirement, employers should take steps such as designating an employee to coordinate their security programs; training and managing employees in their security program practices and procedures; and reviewing service provider contracts to ensure the appropriate safeguards are contained in such agreements, among numerous other steps. While the March 21, 2020, deadline may seem far away, compliance may be a time-consuming and lengthy process.

Iowa Drug Testing Statute Provides Exclusive Remedy for Violations; Separate Wrongful Discharge Claim is Barred
Addressing a matter of first impression, the Iowa Supreme Court determined that “when a civil cause of action is provided by the legislature in the same statute that creates the public policy to be enforced, the civil cause of action is the exclusive remedy for violation of that statute.” Ferguson v. Exide Technologies, Inc., et al, Case No. 18-1600 (Iowa Dec. 13, 2019). Therefore, a plaintiff who brings a claim for a violation of the Iowa drug testing statute cannot also bring a wrongful discharge claim based on the same conduct.

The employee, a wet formation operator (who was required to lift up to 2300 car and tractor batteries in a single shift), sustained workplace injuries associated with repetitive lifting. After the employee was diagnosed with “tennis elbow” in both arms, the employer requested that she submit to a drug test pursuant to the employer’s drug testing policy. The employee refused to take the test. The employer terminated the employee’s employment the next day. The employee subsequently filed a lawsuit alleging violation of the Iowa drug testing statute and a claim for wrongful discharge in violation of public policy. The employer admitted violating the drug testing statute but denied liability (the employee was reinstated). On summary judgment, the employer argued that the wrongful discharge claim was preempted by the Iowa drug testing statute. The district court disagreed and granted summary judgment in favor of the employee on both claims. The case proceeded to a jury trial on damages. A jury awarded the employee nearly $46,000 in back pay, $12,000 in emotional distress, and $35,000 in attorneys’ fees (associated only with the Iowa drug testing statute claim. Under the Iowa drug testing statute, an aggrieved employee only can recover back pay and attorneys’ fees. The employee could not have recovered emotional distress without the wrongful discharge claim.

On appeal, the Iowa Supreme Court reversed the district court, holding that the drug testing statute could not serve as the basis for a wrongful discharge claim. The Court analyzed its prior decisions involving wrongful discharge claims based on statutes that provide a remedy. The Court made a distinction between statutes that provide for administrative remedies and those that provide civil remedies, reasoning that administrative remedies “do not provide the level of protection, control and the right to process involved in the court system.” The Court explained that the original purpose of the common law claim for wrongful discharge was to “provide a court remedy to enforce legislatively declared public policy.” If the legislature has already “weighed in on the issue” by providing a civil remedy in a statute, the wrongful discharge claim becomes “unnecessary.”

The Court affirmed the district court’s award of attorneys’ fees but remanded the case with a direction to enter judgment in favor of the employer on the employee’s wrongful discharge claim, vacate the portions of the jury’s damage award that would be available under a common law tort theory, and uphold those portions authorized by the Iowa drug testing statute. The Court’s decision is significant for Iowa employers. Wrongful discharge claims can expose an employer to back pay, emotional distress and punitive damages. An employee can also request a jury trial on a wrongful discharge claim, which is not available under some statutes, such as the drug testing law. This combination can have a tremendous impact on employers in Iowa, as six-figure emotional distress jury awards have become more commonplace throughout the state.

It is now clear that employees cannot double dip—when a statute provides for civil remedies, those remedies are exclusive. And, an employer’s risk under the notoriously complex Iowa drug testing law will not include emotional distress or punitive damages.

Data Broker Registration for California is Live
Welcome to 2020. The California Consumer Privacy Act (“CCPA”) is now in effect, and your business has probably spent significant time and expense preparing for the law. With so much focus on CCPA preparations, it’s important to recall that the CCPA isn’t the only California privacy law to become effective this year. California will now also require any business that meets the definition of a data broker during a given year to register as a data broker with the California Attorney General’s Office on or before January 31st of the following year. Although the law is not clear whether it retroactively applies to business practices in 2019, the California Office of the Attorney General has issued a press statement on data broker registration and posted a registration page, which strongly indicates that the AG expects qualifying businesses to register by January 31, 2020. Under California law, a “data broker” is a business that knowingly collects and sells to third parties the personal information of a consumer with whom the business does not have a direct relationship. The definition does not include entities already regulated by the Fair Credit Reporting Act, the Gramm-Leach-Bliley Act, or California’s Insurance Information and Privacy Protection Act. California’s data broker registration requirement may look familiar because it is very similar to Vermont’s data broker registration requirement, which took effect in January 2019. For details on Vermont’s data broker registration requirement, please see our prior post. However, a major difference between the laws is that California’s definition of data broker is far more expansive due to the broad definitions of “sell” and “personal information” under the CCPA. Even if you believe your business does not sell personal information in the traditional sense, you should evaluate whether your business meets the definition under the CCPA. California’s data broker registration process is currently as follows. A business representative must create an account with the California Office of the Attorney General. Once registered, the representative must then fill out a registration form, which asks for the data broker’s name, email address, website URL, and physical address. The form also includes optional fields regarding how a consumer may opt out of sale or submit requests under the CCPA, how victims of abuse or elected or appointed officials can demand deletion of their information posted online, and any additional information that the business wants to provide about its data practices. Upon completion of the process, the representative pays a fee and the data broker is added to the California registry, where the data broker’s information is publicly available and can be exported via an Excel file. As of the date of this posting, the registry is empty, although we expect that to change as we draw closer to January 31st. Data brokers that fail to register with the California Office of the Attorney General may be subject to an injunction and liable for penalties of up to $100 for each day they failed to register, unpaid registration fees, and costs associated with an enforcement action brought by the AG.

New Jersey WARN Act Radically Expanded
On January 21, 2020, Governor Phil Murphy signed into law Senate Bill 3170. This bill radically expands employers’ advance notice and severance pay obligations under the Millville Dallas Airmotive Plant Job Loss Notification Act (NJ WARN), making the New Jersey statute the most burdensome and costly reduction-in-force law in the country.

Effective immediately, the following changes to NJ WARN are in force:

  • NJ WARN is now triggered by a termination of 50 employees, regardless of tenure or hours of work, aggregating all terminations across the state and regardless of where within the state the terminations occur. The bill eliminates the law’s prior focus on the number of terminations at a single place of employment, unlike nearly every other WARN and mini-WARN Act in the nation.1 It eliminates the requirement of not counting “part time” employees (those with less than six months of service or working less than 20 hours per week). And it eliminates the rule that a mass layoff is triggered only if at least 33% of the workforce is affected. Unchanged is the rule that terminations are counted only if they occur either within a single 30-day period, or within a 90-day period if it cannot be proved the terminations are for separate and distinct causes. Also unchanged is the provision that the layoff of seasonal employees is not a “termination of employment” under the law. NOTE that under NJ WARN, transferring employees out of state, no matter how close to the original employment site, or transferring employees beyond 50 miles from their original site of employment, is a “termination of employment” if the employees do not accept the transfer, and also potentially so even if the employees accept the transfer.
  • The notice period is now 90 days, not 60. New Jersey joins New York, Maine and the Virgin Islands in requiring 90 days’ WARN notice. Unlike New York, however, the New Jersey statute does not limit damages to a 60-day remedy.
  • Severance pay is now automatic. Previously, NJ WARN mandated severance pay only if the employer failed to give 60 days’ WARN notice. No longer. Now, if NJ WARN is triggered, an employer must pay all terminated employees severance pay of one week for each year of employment, in addition to providing 90 days’ WARN notice. If full WARN notice is not given, the severance obligation is increased by four weeks of pay.
  • NJ WARN now applies to employers with at least 100 employees regardless of tenure or hours of work. NJ WARN previously applied only to employers with at least 100 “full-time” employees, excluding those with less than six months of service or working less than 20 hours per week. Now all employees are counted. Moreover, the statute no longer expressly limits the severance pay obligation to even those larger employers. The bill did not change the rule that a place of employment is only covered if the employer has operated it for longer than three years.
  • Employees may not waive their right to severance under NJ WARN without state or court approval. This is similar to the requirement imposed by many courts on settlements of claims under the Fair Labor Standards Act and suggests that settlements of contested NJ WARN claims may require state or court approval.
  • Employers should consider the impact of the NJ WARN severance pay obligation on programs that require a release of claims as a condition of severance pay. Generally, an employer must offer more than the employee is legally entitled to receive, to have consideration supporting a release of claims. Where NJ WARN is triggered and an employer wants to obtain a release of claims, the employer will need to offer more than the NJ WARN statutory requirement.

“Ban the Box” Set to Apply to Employers in the City of St. Louis
Joining the many cities that restrict criminal-history inquiries in the hiring process, the City of St. Louis Board of Aldermen unanimously passed Board Bill Number 120. Beginning January 1, 2021, all employers (1) located within the City of St. Louis, (2) with 10 or more employees will be prohibited from asking about an applicant’s criminal history until after an applicant is determined to be otherwise qualified for the position and has been interviewed. See our May 2018 alert on Kansas City’s elimination of criminal-history inquiries during the hiring process.

Once the law takes effect, such employers may not do any of the following:

  • Base a hiring or promotional decision on a job applicant’s criminal history or sentence, unless (1) the history is reasonably related to or bears upon the duties and responsibilities of the job position, and (2) the employer can demonstrate that the decision is based on all available information including frequency, recentness, and severity of the criminal history.
  • Inquire about an applicant’s criminal history, until after an applicant (1) is determined to be otherwise qualified, and (2) has been interviewed for the position.
  • Publish job advertisements or put forth any job application that includes statements excluding applicants based on criminal history.
  • Ask about or require applicants to make disclosures about their criminal history on an initial job application form or seek out publicly available information about an applicant’s criminal history.

Employers who are hiring for positions where federal or state laws and regulations or City Ordinances prohibit employers from employing individuals with certain criminal histories are permitted to publish job advertisements or put forth applications that exclude applicants based on criminal history, are permitted to ask applicants about their criminal history on a job application, and are permitted to seek out all publicly available information on an applicant’s criminal history. All employers are also permitted to ask about an applicant’s criminal history if all applicants in a final selection pool from which the position will be filled are asked.

Any alleged violation of the Ordinance will be referred to and investigated by the Civil Rights Enforcement Agency for the City of St. Louis. Violations can then be recommended to the Office of the License Collector for employer compliance. Penalties for violating the Ordinance range from a warning to a revocation of an employer’s business license. Employers could also potentially be assessed civil penalties to be determined by the Office of the License Collector at a later time.

Employers in the City of St. Louis should evaluate their hiring practices and make necessary changes to their applications to remove any requirement to disclose prior criminal history for those positions the Ordinance addresses. Employers should also modify policies concerning the timing of inquiries regarding criminal history, as such inquiries can be made only after interviews have been completed and must be directed at all applicants within the final selection pool. Finally, employers should be mindful that the Ordinance applies to promotional decisions as well as to new applicants.


Court Cases

Court Rejects FDCPA Claim Based on Allegedly Inaccurate Credit Reporting
The U.S. District Court for the Middle District of Florida has awarded summary judgment in favor of a furnisher on a consumer’s claims brought under the Fair Debt Collection Practices Act. The dispute arose out of credit reporting on the account. The plaintiff asserted that the furnisher violated credit reporting standards by inaccurately identifying the “original creditor”; the Court rejected the theory that an inaccurate credit reporting violated the FDCPA and dismissed the claim. Plaintiff Kerry Koehler received cable and/or internet service from Bright House Networks, and then fell behind on her payments. Bright House was subsequently acquired by Charter Communications, which entered into an agreement with Waypoint Resource Group to collect on unpaid accounts, including the debt at issue. Waypoint sent Koehler a collection letter and electronically reported the unpaid debt to a credit bureau through a Metro 2 Format. Waypoint identified the creditor in the “Original Creditor” data field as “Charter Communications” rather than Bright House. Koehler sued Waypoint for a single count under the FDCPA, claiming that the reporting of the debt under the name of Charter Communications instead of Bright House Networks constituted a false and misleading representation and unfair practice. The facts were undisputed, and the parties filed summary judgment motions. The Court specifically found persuasive an existing line of cases in the Middle District finding that “allegations that a creditor did not follow industry standards or otherwise erroneously reported information to a CRA [credit reporting agency] are insufficient to state a claim under the FDCPA.” In other words, inaccurate credit reporting, without more, is not actionable under the FDCPA. The reasoning in these cases can be an important tool for furnishers seeking to prevent attempts by plaintiffs’ counsel to bootstrap FDCPA claims onto credit-reporting disputes when there is no viable claim under the Fair Credit Reporting Act.

A copy of the Order can be accessed at

Different Standards Apply to Equal Pay Act and Title VII Pay Discrimination Claims
The U.S. Court of Appeals for the Second Circuit held that a plaintiff does not need to establish a violation of the Equal Pay Act in order to maintain a pay discrimination claim under Title VII. As the Second Circuit noted in Lenzi v. Systemax, Inc., although both laws prohibit pay differentials based on sex, they are subject to different standards. Under the EPA, a plaintiff is entitled to equal work for equal pay, which requires a showing that the plaintiff performed equal work to an employee of the opposite sex but received unequal pay. Under Title VII, however, the plaintiff must show that they were subject to discrimination in pay because of sex—which does not necessarily require a showing that there were comparators of the opposite sex in substantially equal positions. Although the Second Circuit noted that an employer could discriminate against a female employee by paying her less than male peers performing equal work, that is not the only way to effect discrimination under Title VII. The Second Circuit offered the example of a female employee hired for a unique position who is paid less than she would have been paid if she were male. As the Second Circuit stated, “a claim for sex-based wage discrimination can be brought under Title VII even though no member of the opposite sex holds an equal but higher paying job, provided that the challenged wage rate is not based on seniority, merit, quantity or quality of production or any other factor other than sex.” (Internal quotations omitted).

In the current case, the female plaintiff showed that she was paid below market rate for her position while male executive peers were paid above market rate. The Second Circuit found that “these statistical differences permit an inference of discrimination.” Moreover, the plaintiff offered evidence that her supervisor, who was the CFO, made pervasive disparaging remarks about his ex-wife and females, which also suggested a discriminatory motive. Taken together, these circumstances were enough to support a claim for pay discrimination under Title VII.

Eleventh Circuit Affirms $250K Compensatory Damages Award and Allows a $1 Million Punitive Damages Award in Individual Mixed-File FCRA Action
On January 9, 2020, the United States Court of Appeals for the Eleventh Circuit issued its decision in Williams v. First Advantage Lns Screening Solutions, a case watched closely by the background screening industry. In Williams, the Court affirmed a $250,000 compensatory damages award and reduced a $3.3 million punitive damages award to $1 million in an individual mixed-file claim brought pursuant to 15 U.S.C. § 1681e(b) of the Fair Credit Reporting Act (FCRA). The decision addressed a basic legal requirement in the background screening industry: connecting background information to common names. The matching procedures involved in Williams are similar to those recently scrutinized by the CFPB in another notable FCRA action that we highlighted in the Southern District of New York. In that action, the CFPB also addressed procedures in attributing public records to persons with common names when other definitive unique identifiers, particularly a Social Security number, are absent, coming to similar conclusions as the Williams court.

In Williams v. First Advantage, Plaintiff Richard Williams sued Defendant First Advantage for alleged violations of the FCRA in connection with twice attributing the criminal background information of another individual to Plaintiff. In two criminal background reports developed a year apart, Defendant reported to Plaintiff’s potential employers criminal background information related to a “Ricky Williams.” In its description of the background of the case, the Williams Court focused heavily on Defendant’s procedures for connecting criminal background information with individuals with common names. In order to attribute criminal background information to an individual with a similar name, Defendant’s employees preparing the report were required to attempt to locate three identifiers, such as name, date of birth, Social Security number, or a driver’s license number. Where the employee was unable to locate a third identifier, he or she must note that they were unable to do so and obtain approval by a supervisor prior to releasing the report. Evidence at trial showed that in both instances, Defendant’s employees preparing Williams’s reports relied on only two identifiers. Further, Plaintiff disputed the criminal information contained in the first report, which was later removed. However, different criminal background information related to “Ricky Williams” appeared on Plaintiff’s second criminal background report developed a year later. Importantly, the employees who developed the second report lacked access to information pertaining to the disputed criminal history in the first. At trial, Plaintiff argued that he suffered lost wages of $78,272 and suffered additional emotional and reputational harm as a result of the reporting. The jury found Defendant willfully failed to follow procedures to assure the maximum accuracy of the information in Plaintiff’s consumer report, as required by § 1681e(b) of the FCRA. The jury awarded Plaintiff $250,000 in compensatory damages and an astonishing $3.3 million in punitive damages. After the trial court entered judgment in favor of Plaintiff, Defendant filed a motion for judgment as a matter of law, which the trial court subsequently denied. Defendant appealed.

Defendant raised three arguments on appeal. The first two arguments related to its motion for judgment as a matter of law. First, it argued that the jury’s award of $250,000 should be vacated because the Plaintiff failed to show reputational harm. Second, it argued that Plaintiff had failed to establish a willful violation of the FCRA. Third, Defendant argued that the $3.3 million punitive damages award was unconstitutional under the Due Process Clause. In a brief analysis, the Court affirmed the district court’s denial of Defendant’s motion for judgment as a matter of law with respect to Plaintiff’s showing of reputational harm and willfulness under the FCRA. The Court’s analysis with respect to willfulness is particularly notable, considering the extent to which Defendant’s procedures were scrutinized. The Court recognized that despite having a policy requiring use of a third identifier for screenings involving common names absent supervisor approval for use of two, evidence in the case indicated this did not occur in common practice. Defendant’s Vice President of Operations stated at trial that locating a third identifier was “king of aspirational.” The Court understood this to infer that Defendant consciously disregarded a known risk of violating the FCRA. The Court further pointed out Defendant failed to follow its own procedure during the preparation of both reports related to Plaintiff. Finally, the Court looked to Defendant’s lack of a procedure for flagging disputed criminal background information to avoid repeat occurrences. It found this evidence sufficient to support a willful violation of the FCRA. The Court spent the majority of its seventy-seven-page opinion analyzing the constitutionality of the jury’s $3.3 million punitive damages award. The ratio of punitive damages to compensatory damages in Williams was 13:1. The Court noted the Supreme Court has previously found an award of punitive damages with a 4:1 ratio is “close to the line” of unconstitutionality, and an award that exceeds a single-digit ratio is likely a violation of the Due Process Clause. However, after a lengthy review of relevant case law, the Court determined in candor that it is “ultimately up to the reviewing court to eyeball the punitive damages award and, after weighing the egregiousness of the particular misconduct and the harm it caused, decide whether the award is grossly excessive.”

In the end, the Court ruled that a 4:1 ratio was appropriate in this case and reduced the jury’s punitive damages award to $1 million based on the amount of compensatory damages awarded and its assessment of the reprehensibility of Defendant’s conduct. The Court’s reprehensibility analysis focused primarily on Defendant’s use of only two identifiers when attributing the criminal history of Ricky Williams to Plaintiff, as well as its failure to flag this information once alerted to its inaccuracy to avoid future mispairing.

Based on two concurring opinions filed with the majority decision, the $1 million award was a compromise by the three-judge panel. One judge on the panel would have affirmed the $3.3 million award, while another opined that $500,000 was the proper figure. As one of the judges noted, “[t]he only way to resolve such a disagreement is to meet in the middle—as we have done.” In its punitive damages analysis, the Court noted the tension between competing analyses of Defendant’s error rate with respect to mispairing individuals with criminal background history and the extent to which this placed Defendant on notice of its conduct. Based on evidence at trial, the national rate for all errors in reporting raised through Defendant’s dispute resolution process between 2010 and 2013 was .38%—less than one half of one percent. In mitigating the alleged reprehensibility of its conduct, Defendant argued that this figure was rather low. Plaintiff, on the other hand, argued that based on the high number of reports issued by Defendant, errors still affected some 13,000 individuals. Importantly, however, Plaintiff did not show the extent to which those 13,000 individuals had similar experiences to the Plaintiff. The Court concluded that the extent to which the Court could determine that Defendant was on notice was limited because Plaintiff “failed to bore down into the numbers.” Indeed, the court expressly stated that a high frequency of related experiences would be something the “Plaintiff should have seized on and proved at trial if he wanted to justify an award of extraordinarily high punitive damages.” The decision comes on the heels of a Complaint filed by the CFPB against Sterling Infosystems, Inc. in the United States District Court for the Southern District of New York alleging violations under the FCRA and a simultaneously filed Proposed Stipulated Final Judgment and Order. In the Complaint, the CFPB appeared to stake out a position that matching a criminal record to an individual with a common name based solely on a first and last name and date of birth was inadequate. Challenges to matching procedures utilized by the background screening industry continue to be an area of focus in FCRA litigation. The Eleventh Circuit’s Williams decision represents a noteworthy development on that front.

Pennsylvania’s Medical Marijuana Act at Issue in Recently Filed Complaint
In 2016, Pennsylvania enacted its “Medical Marijuana Act” (MMA), which permits individuals suffering from certain conditions to use marijuana for medicinal use. Several provisions in the MMA impact employers. For instance, the MMA makes it unlawful for an employer to “discharge, threaten, refuse to hire or otherwise discriminate or retaliate against an employee regarding an employee’s compensation, terms, conditions, location or privileges solely on the basis of such employee’s status as an individual who is certified to use medical marijuana.” In other words, taking adverse action against an employee based solely on the individual’s status as a medical marijuana cardholder would likely be considered discrimination under the MMA. The law does not, however, require employers to accommodate the use of medical marijuana at work or to “commit an act that would put the employer or any person acting on its behalf in violation of federal law.” The MMA also allows employers to take action against those who are “under the influence” of medical marijuana while at work. Specifically: Nothing in this Act shall require an employer to make an accommodation of the use of medical marijuana on the property or premises of any place of employment. This Act shall in no way limit an employer’s ability to discipline an employee for being under the influence of medical marijuana in the workplace or for working while under the influence of medical marijuana when the employee’s conduct falls below the standard of care normally accepted for that position. This might suggest that an employer may always discipline an employee for being under the influence of medical marijuana while working. That said, another interpretation is that employers can always discipline an employee for being under the influence in the workplace, but if the employee is outside of the workplace (such as an outside sales position), employers may only discipline such an employee for being under the influence if their performance falls below the standard of care normally accepted for that position. It remains to be seen whether the courts will decide which reading is correct.

A separate section of the law addresses safety sensitive roles. Specifically, the MMA provides that qualifying patients may not “operate or be in physical control of any of the following while under the influence with a blood content of more than 10 ng/ml: (1) chemicals which require a permit issued by the federal government, state government, federal agency or state agency; or (2) high-voltage electricity or any other public utility.” Moreover, it also allows employers to prohibit employees from doing any of the following while under the influence of medical marijuana, regardless of whether the employees are in the workplace or their conduct falls below the standard of care for their position:

  • Performing duties at heights or in confined spaces, including mining;
  • Performing any tasks that threaten the life of the employee or their coworkers; or
  • Performing duties that could result in a public health or safety risk.

Many have wondered: what does it mean for an employee to be “under the influence” of marijuana? Notably, the law is silent as to whether an employer can rely upon a positive drug test as a reason for an adverse employment action in itself, or as evidence of impairment. And, while a manager or supervisor’s observations might be helpful, this doesn’t necessarily mean that the cause of impairment has been or even can be identified. Further, while drug tests might show recent marijuana use, they can’t definitively state the employee’s level of impairment at the time of the test. Hopefully, the Pennsylvania courts will answer these lingering questions.

And on that point, on December 2, 2019, a former worker at a city water and sewer authority filed a state court complaint against the authority alleging a claim for unlawful termination in violation of public policy after he was terminated for testing positive for marijuana during a random drug test. The plaintiff worked as a customer service representative and claimed to have suffered from post-traumatic stress disorder (PTSD). At the time he learned of the positive test result, he advised the authority that he had a valid medical marijuana card. He alleged that his termination violated public policy because he was never required to perform any of the safety sensitive duties set out in the MMA, described above. The crux of the plaintiff’s claim is that he was terminated “solely because he lawfully used medical marijuana to treat his PTSD outside the workplace.” It remains to be seen whether this case might provide clarity as to what Pennsylvania employers can do when faced with an employee who tests positive for marijuana and claims to be a lawful medical marijuana user but does not perform safety sensitive duties. As noted above, the MMA has separate sections that address an employer’s rights and responsibilities under the statute. That the plaintiff in the complaint alleges that he did not perform safety sensitive duties might not end the inquiry. We will continue to monitor this case and report any important developments.

In the meantime, Pennsylvania employers should consider reviewing their drug testing and other substance abuse policies to ensure compliance with the MMA and any other state medical marijuana law that applies to their workers.


International Developments

Another GDPR fine and important considerations for housing associations
A recent decision of the Hellenic Data Protection Agency (HDPA), the Greek equivalent of the Information Commissioner’s Office (ICO) confirms that employers who seek to rely on employee consent as the basis for processing employee data risk being in breach of the GDPR, and potentially liable to fines and enforcement action.

Personal data must be processed in accordance with one or more of the conditions for processing, and in line with the data protection principles, including transparency, fairness and accountability. Although consent is one of several potential processing conditions, it is problematic for employers, because where there is an imbalance of power between the data controller (employer) and data subject (employee), consent may not be able to be freely given, and might cause difficulties if withdrawn. Employers, however, can rely on other legitimate conditions for processing employee data, such as it being necessary for the performance of the employment contract, being processed in compliance with legal obligations, and/or being necessary for the legitimate interests of the data controller (in the private sector: slightly different rules apply for public authorities). The ICO has already made its position clear on this front and since the inception of the GDPR employers have been advised not to use consent as the basis for processing employee data.

In this case, the Big Four consultancy firm, PwC was held to have breached its GDPR obligations and received a fine of 150,000 Euros. It relied on employee consent in order to process employee data, and asked employees to sign their agreement to this effect. Although PwC could have processed the data lawfully, on the grounds suggested above, it was held to have given employees a false impression as to the basis of processing their data and violated the principles of accountability and transparency.

Housing employers should check what information is given to employees about the basis for processing their data and update their privacy notices and employment contracts and/or handbooks to reflect the true reasons for processing, if consent is relied on, either solely or as a “sweep up” reason.

Finally—a brief update on time limits for responding to data subject access requests. The ICO has clarified that the “one month” for responding to a request should be counted from the date of receipt of the request, rather than the following day (which had previously been their position): e.g. a request made on 3 September needs to be responded to by 3 October. Ideally requests should be dealt with as expeditiously as possible, but housing employers should be aware that there is now slightly less time to comply.


Other Developments

Can an Employer Implement a Nicotine-Free Hiring Policy? It Depends on State Law.
Nicotine products are highly addictive and have been linked to a variety of serious health issues, including lung cancer and other respiratory illnesses. In addition to the numerous health risks associated with nicotine use, there is also a causal connection between employee nicotine use and lower productivity in the workplace, as well as higher healthcare costs for employers. In response to these issues, and in an effort to promote and empower a healthy workforce, more employers are enacting health-conscious workplace policies and anti-smoking/vaping initiatives.

In fact, over the last decade, employers—particularly hospitals and businesses in the medical field—have adopted anti-smoking/vaping policies in those states in which it is lawful to do so, with the goal of encouraging a healthier work environment, as well as to increase worker productivity and reduce healthcare costs. On December 30, 2019, U-Haul International announced a new nicotine-free hiring policy that will go into effect in 21 states on February 1, 2020. Although U-Haul subsidiaries operate in all 50 U.S. states and 10 Canadian provinces, due to legal restrictions in some jurisdictions, the policy will be implemented only in the following 21 U.S. states: Alabama, Alaska, Arizona, Arkansas, Delaware, Florida, Georgia, Hawaii, Idaho, Iowa, Kansas, Maryland, Massachusetts, Michigan, Nebraska, Pennsylvania, Texas, Utah, Vermont, Virginia, and Washington. Prospective employees in those states will see statements regarding the nicotine-free hiring policy on application materials and will be questioned about nicotine use. Further, to be considered for employment in states where nicotine testing is allowed, applicants will be required to consent to submit to nicotine screening in the future. U-Haul employees hired prior to February 1, 2020 will not be affected by the new policy.

U-Haul will be the first major company in its field to refuse to hire applicants who are nicotine users, and the new policy has caused some to question whether companies which, like U-Haul, are deeply invested in the well-being of their employees, are allowed to enact such policies. The answer to that question depends on the jurisdiction in which the company operates. Nicotine users are not a “protected class” under any federal anti-discrimination law, and thus state law governs this issue. In each of the 21 states in which U-Haul companies will implement its policy, there are no laws that protect the rights of nicotine-users or prohibit employers from declining to hire applicants due to their engaging in otherwise lawful conduct outside the workplace. Therefore, a policy refusing to hire nicotine users is perfectly legal in those jurisdictions, and employers in those states are free to enact nicotine-free hiring policies if they so choose.

However, employers who are considering implementing such nicotine-free hiring policies should tread carefully. The rest of the 29 states where U-Haul subsidiaries are not implementing its policy (and the District of Columbia) have various anti-discrimination or employee privacy laws preventing employers from enacting such policies. These states provide varying degrees of protection to employees. For example, some states broadly forbid employers from discriminating against applicants or employees based on the use of “lawful products” or for “lawful conduct,” whereas other state laws specifically protect an applicant’s or employee’s right to smoke or use other tobacco products. Although these states are generally more employee-friendly in this context, in some of these jurisdictions, employers can require smokers to pay higher health insurance premiums, so long as the additional amount reflects the actual differential cost to the employer. Further, employers can still regulate and limit an employee’s on-site smoking and can typically offer financial incentives for employees who participate in wellness programs to help them quit smoking.

Biometric Data Can Reduce Personnel Risks without Increasing Your Legal Risks

As artificial intelligence technology advances, it’s only natural for businesses to employ it for better efficiency and tighter security. The use of biometric data, which is on the forefront of AI technology in the human resources arena, provides tremendous value in hiring, ongoing employee management, and overall workplace security.


What is Biometric Data?


If you use your thumbprint to unlock your smartphone and log in to its apps, you’re using your personal biometric data for authentication (instead of typing in your username and password) and you probably don’t think twice about it. Facial recognition, eye scanning, and voiceprints are also examples of biometric data currently being used by banks, hospitals, law enforcement, workplaces, and other facilities that want higher and more-efficient levels of security around building and information access.


Regardless of when or where biometrics are used, the nature of the data collected for it requires businesses to adhere to tighter legal requirements. That means the efficiencies it provides in hiring or elsewhere may just be spent in new places like oversight and legal monitoring. Currently, only three states–Illinois, Texas, and Washington–have enacted specific legal requirements for employer use of biometrics, but more are already preparing to follow suit. Naturally, international laws are quite varied.


Rely on Data Specialists with Compliance Expertise


Technology partners who specialize in data collection from personnel and potential hires can help your business benefit from biometrics and stay ahead of its legal risks. ClearID from ClearStar is a simple way to get reliable, on-the-spot identity validation of job candidates with their written consent in about five minutes. Once the candidate is verified, additional background screens can be managed and monitored through the app. The award-winning biometrics-based app is a game-changer for a fast-changing workforce and employers that need the most vetted candidates at a moment’s notice.


Connect with ClearStar to learn how ClearID simplifies the use of biometric data in a way that can benefit your business by mitigating personnel risks without creating legal compliance risks.

Best Practices for Background Checks

Best Practices for Background Checks

Establishing best practices for your company’s background checks streamlines hiring and workforce management. Or does it?

Adhering to best practices for employee background checks can keep your business out of trouble caused by personnel issues. But, there’s more to doing background checks than screening for and maintaining a workforce that’s based on truthful representation and skilled to meet their job descriptions.


While “best practices” are essential, when it comes to background checks, your business’s guidelines could potentially cover an overwhelming amount of information.  In fact, background screening processes could generate so much work—and require enough subject matter expertise—that you’d need an entire department devoted to them.


In general, professional background checks include the screening of a person’s credit history, criminal record, driving history, drug use, educational background, professional licensures/certifications, social media presence, work history, and possibly more. That’s an enormous amount of information to gather, review, and align with your business needs. You’ll need to make sure you’re protecting that information with modern-day security standards like those set forth in the ISO 27001 family. And that’s not all you need to consider.

As state and local governments begin to ban salary history requests, regulate questions about criminal histories, and update marijuana laws, you’ll have to align the best practices of your background checks to comply with the constantly-changing legal requirements that will vary across cities, counties, and states. Plus, if your workforce is international, you’ll have to add the legal requirements of other nations to that list. And, depending on the nature of your business, you may need to understand legal code that’s specific to your industry, too.

So, what’s the best way to establish and maintain your company’s best practices for background checks? Hire the experts to guide you. Make ClearStar your best practice. Our experts can efficiently gather information directly from your employees, and help ensure your program is in compliance with the most up-to-date legal regulations so your business can do what it was intended to do.


There’s a Wealth of Applicant Information at Your Fingertips. Can you use it? Should you?

We’ve all done it. You enter the name of the person who’s now dating your ex, the kid that’s taking your 17-year-old daughter to the movies, the neighbor that’s suddenly your elder parent’s new BFF, or the candidate that just applied for a job with your company. What is Google telling you? How many social media sites did you plug the name into? How many hours are you spending opening pages, reading posts and tweets, all while your heart is racing and you’re struggling to determine if this is the person you are trying to obtain information on or just someone with the same name.

When you see a picture or confirm an address and you realize it is the person you are trying to obtain information on, what do you do with the information? Well, we can’t lend you any advice on the personal side, but if it’s a prospective employee or even someone that you just interviewed, you must keep in mind that not all data is equal. While these searches seem harmless, the information retrieved could potentially create legal issues for your business. You may have uncovered information that, in a professional setting, you absolutely do NOT want to have knowledge of, especially relating to age, disabilities, gender, religion, or sexual orientation. Can you un-see what you’ve just seen? Chances may be slim that anyone would know if you saw such information if you did the search yourself, but it is possible and discoverable in the context of litigation.

HR professionals and most employers are aware of the EEOC (Equal Employment Opportunity Commission) and its view on using this type of information. The EEOC website states: When making personnel decisions—including hiring, retention, promotion, and reassignment— employers sometimes want to consider the backgrounds of applicants and employees. Except for certain restrictions related to medical and genetic information, it is not illegal for an employer to ask questions about an applicant’s or employee’s background or to require a background check. But the employer cannot conduct background checks or use the information obtained in a manner that denies equal employment opportunity to anyone on a protected basis, by intent or by unlawful disparate treatment based on race, origin, or other protected categories under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.

The bottom line is any background information you receive, regardless of the source, must not be used to discriminate against an applicant or employee in violation of the EEOC Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions, Ban-the-Box laws and regulations, or any additional applicable laws and regulations. For more information regarding the EEOC, you can visit their website here. Please note that unlike the FCRA, the EEOC and various Ban-the-Box regulations do not make a distinction whether you did the background check yourself or hired a Consumer Reporting Agency (CRA) to do it for you.

So what about the data that is readily available online? Is it the same data you’d receive from an accredited CRA? In many cases, the answer is a simple NO. CRAs should be getting their data from trusted and thoroughly vetted sources and they should have procedures in place to ensure maximum possible accuracy (if you’re in the screening industry or involved with background checks for your organization, this should be a very familiar phrase). The companies that provide the data you find online or the data they pull to tease you to purchase subscriptions or join the site for “unlimited” checks with, are only concerned about stockpiling enormous amounts of data (and money) with little to no regard for the quality, accuracy, and completeness of the data.

Let’s return to the scenario we opened with. You are the hiring manager (or someone that has influence on hiring at your company) and you have an interview tomorrow. You decide to plug the applicant’s name into a variety of search engines and social media sites. Oh my! You found arrest records from 2005 relating to possession of a controlled substance. They are from the same city the applicant currently resides in and the name is the same. Now what? Say you decide to continue as planned with the interview. It goes well, and the applicant has the skills, expertise, and experience you are looking for. So you order a background check from your trusted 3rd party CRA…and the criminal section comes back clear. Why? You just Googled it and found the information yourself! How could the CRA possibly return a clear background check?

There are many legitimate reasons why this can and does occur. Perhaps it was only an arrest record and never went to court or there wasn’t enough evidence and the charges were dismissed. It could be that the applicant resides in a state that does not allow information to be reported if it’s older than 7 years. But the reason we see most often is that the data truly does not belong to your applicant. When the complete record is obtained at the source, the researcher is able to determine that the identifiers do not match your applicant.

Let’s be real, we’re all going to continue to use the Internet and unregulated search options that are so easily available to us, but hopefully this makes you think before coming to a conclusion that could adversely impact not only the applicant but also your company. As the workforce becomes more educated and aware of individual rights when it comes to background checks and personal information, employers will increasingly become litigation targets. We recommend that you consult with your legal counsel or someone that specializes in employment law that can help you create a thorough and compliant background screening program. Although, it may sound counter-intuitive, sometimes the less you know, the better off you (and your company) are. This is for the record.

For The Public Record is a monthly blog featuring thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process. Click here to subscribe.

Can HR Efforts Save Your Toxic Workplace Culture?

Few of us expect every workday to feel like a trip to Disneyland, but we also don’t expect every workday to feel like a hardship. Unfortunately, far too many workers experience burdens like unrealistic expectations, lack of job clarity, poor internal communication, bully bosses, and counterproductive coworkers on a daily basis. It takes a toll on an individual’s mental and physical well-being and it costs employers a lot of money off the bottom line.


Two 2019 reports recently published by SHRM (Society for Human Resources Management) solidified some statistics about America’s workplaces. No one in the workforce should be surprised by these findings:


  • In the past 5 years, 20% of workers left their jobs citing bad workplace culture.
  • Nearly 25% of workers dread going into work and don’t feel respected there.
  • Workplace culture makes 33% of workers carry their irritability home.
  • About 56% of workers are less than “fulfilled” at work.
  • Of those who left jobs due to culture, 58% cited managers as a specific reason.


If you are surprised to see this statistics­—or if anyone with a management-level position in your organization pooh-poohs them—there’s probably some work to be done changing the course of your business and HR may be the best place to start. (The highest stat above is in reference to managers.)


Screening for Toxicity


According to the SHRM reports, it sounds like most workplaces can use at least a little disinfecting. And a workplace doesn’t have to be as toxic as NBC to be a depressed culture that’s inhibiting health and prosperity for your business.


Whether you’re new in an HR role at an existing company, launching an entirely new company, or wanting to reinvigorate the team after years with the same company, you can use background screens to help you set the right tone going forward. Ask ClearStar along to help screen out the overly competitive users and abusers who will drain your resources and hire trustworthy believers and achievers who can make your whole business environment better.

Implicit Bias, Criminal Histories, and the Equal Employment Opportunity Commission

Imagine you have two candidates in the final running for a position at your company. One is a woman. One is a man. They are of different ethnicities. Both are perfectly qualified. They have the same college degrees and equal years of work experience, too. They both are eager to join your team and you know this because they both sent very nice “thank you” emails after their interviews. Your office is in a large metropolitan area known for traffic headaches and both of your candidates just happen to live within 2 miles of the office. How convenient! And both candidates are happy with the salary range being offered for the position. In fact, they are both so ideal, that you send them through for background screens with the thought that you could hire both!


Oddly enough, both background screens come back with very similar results. Both candidates have criminal records­—it appears they were convicted of the exact same misdemeanor charge during their college years. That’s the only thing on each of their records, but you feel a change in your gut about hiring both, and you decide to make an offer to just one of them.


How has this imaginary scenario played out in your mind? Who did you picture as the two candidates? Which one did you hire?


The EEOC Makes Sure Hiring Managers Choose Well


Why did you choose that candidate over the other one when absolutely everything about them was the same…except for gender and race?


When it comes to hiring, we all know some managers blatantly make choices to reinforce racist, sexist, or other discriminatory beliefs. But we may also make choices completely unaware of our biases and how they inadvertently reinforce discrimination. This is where Title VII of the Civil Rights Act of 1964 and the Equal Employment Opportunity Commission step in to protect job applicants and employees in the face of blatant and inadvertent discrimination.


Though the Civil Rights Act had been in effect for nearly 50 years, in 2012, the EEOC issued enforcement guidelines to clarify how the Civil Rights Act specifically protects job applicants and employees who have criminal histories saying, “Title VII prohibits employers from treating job applicants with the same criminal records differently because of their race, color, religion, sex, or national origin…” even when the exclusions are applied uniformly. Because it can be easy to believe our choices are based on safety and security when they’re actually based on our biases…could you be in trouble for who you chose to hire in the scenario above?


Protecting Your Business from EEOC Violations


Awareness, education, and training may do the most work in combatting discrimination in hiring. And if you’d like to know what your implicit biases are, Harvard University’s Project Implicit offers short, online self-tests that may open your eyes to the subconscious judgments you’re making about your fellow humans’ weight, gender, religion, etc., even when all of the facts presented about them are equal.


That’s why you need to make sure you’re starting out your hiring process by getting solid facts via thorough background screens on your job applicants and employees. ClearStar helps ensure your company is providing a level playing field for your employees.

December 2019 Screening Compliance Update

Federal Developments

CFPB Weighs in on Key Background Check Issue: What is an Adequate Basis to Attribute a Criminal Record to an Individual?
A major background check vendor has settled charges by the Consumer Financial Protection Bureau (CFPB) that matching practices—the bases by which it attributes a criminal record to a specific individual—violated the Fair Credit Reporting Act (FCRA). At bottom, the settlement attempts to establish a standard that name and Date of Birth matching alone is insufficient to comply with the FCRA’s accuracy requirements, “three-factor” matching (name, DOB and address for example) is the minimum compliant matching standard. The settlement also covered other noteworthy business practices in the background check industry.

On November 22, 2019, the CFPB filed a Complaint against Sterling Infosystems, Inc. in the United States District Court for the Southern District of New York alleging violations under the FCRA and simultaneously filed a Proposed Stipulated Final Judgment and Order.

The 10-page Complaint against Sterling alleges the company violated sections 1681e(b), 1681k(a) and 1681c(a) of the FCRA. Each alleged violation is described below.

1. Alleged Failure to Employ Reasonable Procedures to Assure Maximum Possible Accuracy (1681e(b))
In the Complaint, the CFPB alleges that the following procedures, or lack of procedures, led Sterling to report erroneous adverse items of information on consumer reports:

(i) Matching Based on Two Identifiers: Between December 16, 2012, and October 2014, Sterling matched criminal records using two identifiers (which could include (i) first and last name and (ii) date of birth). This policy allegedly created a heightened risk of false positives because many commonly named individuals (e.g., John Smith) share the same first and last name and date of birth. Because of the widespread lack of access to Social Security numbers in criminal records, background check companies need to determine whether a given record applies to a given consumer using matching criteria. The CFPB takes the position that two-factor matching consisting of name and date of birth is inadequate.

(ii) Insufficient Training on New Policies: Beginning in October 2014, Sterling adopted its first company-wide common-name matching criteria, which required a match on three personal identifiers. But continuing after October 2014 through July 31, 2016, Sterling continued reporting instances of erroneously matching criminal records on common-name applicants due to supposedly insufficient training on the new common-name matching policy. The CFPB seems to be taking the position that three-factor matching can be adequate.

(iii) Junior/Senior Issue: Other instances of reporting errors involving both common and uncommon names were the result of another policy where Sterling permitted matching criminal records with male applicants based solely on a matching first and last name and matching address. This too created an allegedly heightened risk of false positives because some males with the same first and last name (i.e., a junior and senior) live at the same address.

(iv) High-Risk Indicators: On one of its platforms, Sterling included in the Social Security Trace portion of its reports the notation ***HIGH-RISK INDICATOR*** next to an address, followed by a descriptor placing the address into a particular category. These categories included Psychiatric Hospital, Nursing and Personal Care Facility, Corrections Institution and Social Service Facility, among others. Sterling included a statement that the SSN Trace should not be used for an FCRA purpose. Sterling allegedly did not implement any procedures to verify the accuracy of these high-risk designations.

2. Alleged Failure to Maintain Strict Procedures to Ensure that Adverse Public Record Information Contained in the Consumer Reports was Complete and Up to Date (1681k(a))
The CFPB alleges that Sterling violated section 1681k(a) of the FCRA because: (1) Sterling has not, in many instances, notified applicants of the fact that it was reporting public record information about the application at the time that information was being reported, and (2) for the same reasons as described above, Sterling failed to maintain “strict procedures” to ensure that the public record information it reported is “complete and up to date.”

3. Alleged Reporting of Outdated Adverse Information (1681c(a))
Finally, the CFPB alleges that Sterling violated section 1681c(a) in the following ways:

(i) Outdated Addresses: In the Social Security Trace portion of its reports, Sterling reported the ***HIGH-RISK INDICATOR*** next to an address at which the applicant lived and was “last seen” more than seven years before the report was generated. Per the CFPB complaint, “such a designation may be an adverse item of information because it could cast the consumer in a negative or unfavorable light.”

(ii) Outdated Adverse Criminal Information: Beginning in May 2012 and continuing through February 2013, Sterling used the “disposition date” as the start date for the seven-year calculation. The CFPB alleges that “date of entry” should be used on records of arrest, and “date of criminal charge” should be used for other non-conviction criminal record information.

The parties’ Proposed Stipulated Final Judgment and Order provides for the following:

  1. Monetary Payment:
  • $6,000,000 paid into a Redress Fund. The Redress Fund will be paid pro rata to approximately 7,100 consumers who successfully disputed criminal records.
  • $2,500,000 paid as a Civil Penalty.
  1. Conduct Requirements:
  • The proposed order does not include any specifics in this section. Rather, the proposed order only repeats the requirements of the FCRA under sections 1681e(b), 1681k(a) and 1681c(a).
  • The only specifically defined change in conduct is that Sterling will not report High-Risk Indicators for the next 5 years.
  1. Compliance Committee:
  • Sterling has to establish a Compliance Committee.
  • The Compliance Committee must meet at least once every two months and maintain minutes.
  • The Compliance Committee will be responsible for monitoring and coordinating Sterling’s adherence to the Order.
  1. Role of the Board
  • The Board of Directors of Sterling is ultimately responsible for compliance with this Order and must review all submissions to the CFPB under this Order.
  1. Reporting Requirements:
  • For 5 years, Sterling must provide a written compliance progress report that details the manner and form in which Sterling has complied with each paragraph of the Order.

EEOC Conciliation Agreement Over Criminal History Background Checks Serves as a Reminder to Employers to Take a Fresh Look at Their Screening Practices
Synopsis: After six years of litigation, on November 18, 2019, the Equal Employment Opportunity Commission (“EEOC”) announced a multi-million settlement with a national employer, which resolved litigation that claimed the employer’s use of criminal history had a disparate impact on minority job applicants. The announcement is a reminder to employers to carefully draft and implement their screening policies as they relate to use of an applicant’s criminal history.

Criminal history information can be a crucial tool in the employment decision process. During the past few years, state and local governments have been limiting employers’ use of criminal history information in the employment process through regulation, litigation, and legislation. In 2012, the Equal Employment Opportunity Commission (“EEOC”) issued guidance in an effort to limit employers’ options with respect to their use of this tool. See:

The EEOC has brought several high-profile lawsuits against national employers over their use of criminal history information, with some cases resulting in employer victories. Most recently, on November 18, 2019, the EEOC announced in a press release that a nationwide retailer settled a race discrimination lawsuit brought by the EEOC, which challenged the employer’s use of criminal history for employment purposes. Specifically, the EEOC had alleged that the employer’s use of criminal history resulted in a disparate impact against minority workers, especially African Americans who had been excluded from jobs at higher rates than non-minority applicants. The EEOC gave as an example an applicant denied a position for having a six-year-conviction for possession of a controlled substance, which fell within the employer’s 10-year exclusionary rule for this type of conviction.

The three-year consent decree requires that the employer not only pay $6 million (to be distributed to aggrieved individuals) but also, if the employer elects to continue considering criminal history pre-employment, hire a criminologist to develop a new criminal background check based on certain factors including: (a) the time since conviction; (b) the number of offenses; (c) the nature and gravity of the offense(s); and (d) the risk of recidivism. Once the consultant provides a recommendation, the employer is not allowed to use any other pre-employment criminal background check. Until the criminologist provides a recommendation, the employer must continue to conduct individualized assessments.

The settlement also enjoined the employer from discouraging people with criminal histories from applying, engaging in retaliation, and otherwise discriminating on the basis of race in implementing a criminal history check. The employer also is now required to advise conditional hires of its background screening processes and state that having a criminal history is not an automatic bar to employment. In addition, the settlement requires the employer to update its process when a rejected applicant requests that the company reconsider its decision. As part of this process, the employer is required to clearly communicate to disqualified applicants that they may provide additional information to the employer to support reconsideration of the adverse decision. Finally, the employer must provide reports to the EEOC regarding its implementation of any new criminal history checks and its reconsideration process.

The employer remained steadfast in its position that its screening policies were lawful, and the settlement should not be viewed as any admission by the retailer of any wrongdoing.

Employer Considerations
Employers in all jurisdictions should consider an attorney review of their pre-employment and hiring practices by experienced counsel. Setting aside the EEOC’s guidance, many states and localities have their own laws concerning “job relatedness” requirements for an employer’s use of criminal history information, including California, New York, Pennsylvania, and Wisconsin, among many others. Further, subject to narrow exceptions, some states, counties and cities do not even permit employers to inquire about criminal history information on the initial written application form or before a conditional offer, including ordering a criminal background check report from a consumer reporting agency. Against this backdrop, and based on an individual employer’s operations, a company might consider the following best practice recommendations, including:

  • Eliminating policies or practices that exclude people from employment based on a bright-line rule, for example, any criminal record or any felony.
  • Training managers, hiring officials, and decision-makers about the numerous laws that impact use of criminal history information.
  • When asking questions about criminal history information, limiting inquiries to records for which exclusion would be job related for the position in question and consistent with business necessity.
  • Keeping information about applicants’ and employees’ criminal history information confidential and only using it for the purpose for which it was intended.

In addition, employers continue to be targeted in Fair Credit Reporting Act (FCRA) class action lawsuits over the process they use to obtain and make decisions based on background check information obtained from a consumer report agency. As a result, employers are well advised to consider evaluating their use of criminal history information and any other background check information to ensure compliance with the FCRA, similar state fair credit reporting statutes and substantive employment laws.


State Developments

Tenant Protection Act of 2019 May Have Unintended Consequences in the Cannabis Space
The California Legislature has passed Assembly Bill 1482—Tenant Protection Act of 2019 (“AB 1482”), providing for comprehensive statewide residential rent control and eviction protections. Signed by Governor Newsom in October 2019, and commencing January 1, 2020, AB 1482, among other things, requires a landlord to evict a tenant only for “just cause” if the tenant has occupied the property for more than 12 months. AB 1482 will remain in effect until January 1, 2030. In the cannabis space, AB 1482 has been giving landlords and tenants pause. Specifically, the question many are grappling with is whether engagement in certain cannabis activities rise to the level of “just cause” justifying eviction of a tenant under the terms of AB 1482. As described in AB 1482, “just cause” means: (a) failure to pay rent; (b) material breaches of lease; (c) committing waste; (d) commission of a nuisance; (e) criminal activity on the property, or criminal threats against the landlord or landlord’s agent; (f) improper assignment/subletting of space; (f) refusal to allow landlord to enter the property as authorized by law; (g) refusal to execute a written extension or renewal of the lease that terminates on or after January 1, 2020 for an additional term of similar duration with similar provisions, provided that those terms do not violate this section or any other provision of law; and/or (g) failure to vacate. If the eviction is for just case but is a curable lease violation, a landlord must first give notice of the violation to the tenant with an opportunity to cure the violation. If the violation is not cured within the time period set forth in the notice, a 3-day notice to quit without an opportunity to cure may be served to terminate the tenancy.

Evictions where there is “no fault” of the tenant are permissible when: (a) it is a result of the landlord’s compliance with a government order or a local ordinance that requires vacating the residence; (b) the unit is being removed from the rental market; (c) the landlord intends to demolish or substantially remodel the residential unit; or (d) the landlord or specified family members of the landlord intend to occupy the residential real property. In the event the owner evicts a tenant based on “no fault” of the tenant, the owner must, at the owner’s option, either assist the tenant to relocate or waive in writing the payment of rent for the final month of tenancy. Further, any notice of termination on this basis must include notice of the tenant’s right to relocation assistance or rent waiver.

In drafting AB 1482, a bill with the express purpose to provide heightened protections for tenants, the Legislature most certainly did not take into consideration the dichotomy between federal and state cannabis laws. As an initial matter, most leases require compliance with local, state and federal law, and cannabis-related activities may constitute a material breach of the lease, a qualifying action for “just cause” eviction.

California’s Health & Safety Code section 11362.1(a) provides that: “[I]t shall be lawful under state and local law, and shall not be a violation of state or local law, for persons 21 years of age or older to:

  1. Possess, process, transport, purchase, obtain, or give away to persons 21 years of age or older without any compensation whatsoever, not more than 28.5 grams of cannabis not in the form of concentrated cannabis;
  2. Possess, process, transport, purchase, obtain, or give away to persons 21 years of age or older without any compensation whatsoever, not more than eight grams of cannabis in the form of concentrated cannabis, including as contained in cannabis products;
  3. Possess, plant, cultivate, harvest, dry, or process not more than six living cannabis plants and possess the cannabis produced by the plants;
  4. Smoke or ingest cannabis or cannabis products; and
  5. Possess, transport, purchase, obtain, use, manufacture, or give away cannabis accessories to persons 21 years of age or older without any compensation whatsoever.

Despite attempts to the rectify the inherent inconsistency with state law, the federal government still classifies cannabis as a Schedule I drug under the Controlled Substances Act. Therefore, possession, personal cultivation or use of cannabis on the residential premises would constitute a violation of federal law. Therefore, if the lease includes the above-referenced compliance provision, a landlord, arguably, has “just cause” to evict a tenant if the tenant fails to cure this breach in lease terms. Moreover, the landlord may claim the cannabis-related activities are a nuisance under Civil Code section 1946.2, also justifying “just cause” eviction.

Additionally, California law gives landlords the green light to include specific terms in a residential lease the prohibit a tenant’s possession, personal cultivation or use of cannabis within the residential unit and/or common areas. Health and Safety section 11362.1(a) specifically conditions this code provision on Section 11362.45, expressly states: “Section 11362.1 does not amend, repeal, affect, restrict, or preempt the ability of an individual or private entity to prohibit or restrict any of the actions or conduct otherwise permitted under Section 11362.1 on the individual’s or entity’s privately owned property.” (Heath & Saf. Code § 11362.45(h).)

Therefore, while California law holds cannabis-related activities identified in Health and Safety Code section 11362.1 are not “criminal activity,” property owners and landlords are not precluded from prohibiting cannabis-related activities on the premises per the terms of the lease. Under AB 1482, landlords are, then, well within their rights to evict any violating tenant for “just cause” following the required notice and cure period. Tenants engaging in cannabis activities and landlords could all benefit from taking a hard look at their current residential leases in advance of January 1, 2020 and from working towards remediation of any violations.

NYC Fair Chance Act Restricts Employers’ Consideration of Criminal Background
The New York City Fair Chance Act (FCA) places significant obligations and restrictions on employers that consider criminal histories in the hiring process. Employers that fail to follow any of the multiple steps required by the FCA risk significant damages under the New York City Human Rights Law.

Under the FCA, New York City employers may not in any way inquire into an applicant’s criminal history prior to extending a conditional offer of employment. Importantly, the FCA covers both external candidates seeking employment as well as current employees seeking promotions, transfers or other job changes. Both external and internal job advertisements, solicitations and employment applications cannot seek criminal background information—or even mention that a background check is required. Likewise, an applicant’s criminal history cannot be discussed during a job interview. If the applicant voluntarily discloses his or her criminal history, the employer must explain that the criminal history cannot be considered at that time and change the subject. Once a conditional offer of employment, promotion or job change is made, the employer may obtain information regarding the applicant’s criminal history. If a criminal history exists, the FCA requires that the employer assess the applicant in accordance with New York Correction Law Article 23-A. Pursuant to Article 23-A, an employer may reject the applicant in only two circumstances:

  1. if there is a direct relationship between the criminal offense(s) and the specific job for which the applicant applied; or
  2. if hiring the individual would involve an unreasonable risk to property or to the safety and welfare of individuals or the general public.

To determine whether these exceptions apply, the employer must conduct an individual assessment of each criminal offense using an eight-factor test set forth in Article 23-A. Those eight factors are:

  • the public policy of New York is to encourage the employment of persons previously convicted of one or more criminal offenses;
  • the specific duties and responsibilities necessarily related to the employment sought or held by the applicant;
  • the bearing, if any, the criminal offense(s) for which the applicant was previously convicted will have on his or her fitness or ability to perform one or more such duties or responsibilities;
  • the time which has elapsed since the occurrence of the criminal offense(s);
  • the age of the applicant at the time of the occurrence of the criminal offense(s);
  • the seriousness of the criminal offense(s);
  • any information produced by the applicant, or on his or her behalf, in regard to his or her rehabilitation and good conduct; and
  • the legitimate interest of the employer in protecting property and the safety and welfare of specific individuals or the general public.

When assessing whether a direct relationship exists between the criminal offense and the job, the employer must analyze the crime against specific job duties and responsibilities that were defined (preferably in writing) prior to making the conditional offer of employment. When assessing whether the applicant would present an unreasonable risk to property or the safety and welfare of individuals or the public, the employer must begin with the assumption that no risk exists and then establish how the eight factors (combined or alone) create such a risk.

If, after conducting the eight-factor analysis, an employer determines that employment or the job change should be denied, the employer must send a written statement to the applicant setting forth the details of the eight-factor analysis and asking the applicant for any evidence of rehabilitation or good conduct. Along with this written statement, the employer must provide a copy of any of the documents the employer relied on (e.g., background check, Internet search results) and give the applicant at least three business days from his or her receipt of the statement to respond before making a final decision. The employer must keep the position open during the applicant’s response period.

If the applicant provides supplemental information or documentation, the employer must then repeat the eight-factor analysis, taking into consideration the new evidence. If the employer still wants to revoke the employment offer or deny the promotion or job change, the FCA requires the employer inform the applicant of its final decision. Finally, if the applicant ever requests a written statement setting forth the reasons for the job denial, the employer must provide that statement within 30 days.

Given the FCA’s multitier process, a formal criminal background check policy, including accurate record keeping, is highly recommended. There are per se violations for failing to meet each of the required obligations and significant monetary damages if applicants are denied jobs in violation of the FCA or Article 23-A. In addition, the New York City Commission on Human Rights has expressed its commitment to ensure employer compliance with the FCA and in 2018 conducted nearly 300 tests to determine whether employers were unlawfully asking applicants about their criminal histories. The Commission also announced it would be bringing 12 charges against national and local businesses for discriminating against job applicants with criminal histories

Waterloo, Iowa Enacts Ban the Box Restrictions
All private employers with at least 15 employees, including the City of Waterloo, are subject to the Ban the Box Ordinance (the “Ordinance”), which is scheduled to take effect on July 1, 2020. Covered employers may not inquire in any manner about an applicant’s criminal records prior to issuing a conditional offer of employment, unless criminal history is voluntarily disclosed by the applicant before an offer. Employers also are prohibited from making any employment decision based on:

  • arrests or pending criminal charges; and
  • convictions that have been erased, expunged, pardoned or nullified.

In addition, an employer may only rescind a conditional offer of employment based on a criminal record if it has a legitimate business reason, which means, according to the Ordinance:

  • Situations where the nature of the criminal conduct has a direct and substantial bearing on the fitness or ability to perform the duties or responsibilities of the position, taking into consideration the following factors: the nature of the position, the place and manner in which the duties will be performed, the nature and seriousness of the offense or conduct, whether the position presents an opportunity for the commission of a similar offense or conduct, the length of time between the conviction or arrest and the employment application (not including time on probation or parole or the time during which fines or other financial penalties or remedies may be outstanding), the number and types of convictions or pending charges, and any verifiable information provided by the applicant that is related to the applicant’s rehabilitation or good conduct.
  • Situations where the granting of employment would involve unreasonable risk of substantial harm to property or to safety of individuals or the public, or to business reputation or business assets, taking into consideration the factors listed above.
  • Positions working with children, developmentally disabled persons and vulnerable adults where the applicant has a conviction record of a crime against children or disabled or vulnerable adults, including but not limited to crimes of rape, sexual abuse, incest, prostitution, pimping, pandering, assault, domestic violence, kidnapping, financial exploitation, neglect, abandonment, and child endangerment.
  • Situations where an employer must comply with any federal or state law or regulation pertaining to background checks and the criminal conduct is relevant to the applicant’s fitness for the job

E-Verify to be Required for All Pennsylvania Construction Companies
The CONSTRUCTION INDUSTRY EMPLOYEE VERIFICATION ACT (“the Act”) became Pennsylvania law on October 7, 2019 and takes effect on October 6, 2020. The Act requires that all Pennsylvania-based construction companies utilize the E-Verify system for Forms I-9 (Employment Eligibility Verification). Those who run construction and trades businesses have a little less than one year to get their houses in order and become users of E-Verify. The companies which do so will be better positioned in this tight employment market, since only individuals who can verify their ability to work in the United States will be legally employable. Those who do not comply may have to contend with Pennsylvania Department of Labor and Industry (DOLI) oversight, and ultimately could have their professional licenses suspended or revoked. What may be most surprising to construction trade professionals is that the Act applies to nearly every conceivable business engaged in the construction trades:

“Construction industry.” The industry which engages in the erection, reconstruction, demolition, alteration, modification, custom fabrication, building, assembling, site preparation and repair work or maintenance work done on real property or premises under a contract, including work for a public body or work paid for from public funds.
(The Act, Section 2. Definitions)

Another surprising piece of the Act may be that it applies to all but one-person operations:

“Construction industry employer.” As follows: (1) An individual, entity or organization in the construction industry, which: (i) transacts business in this Commonwealth; and (ii) employs at least one employee in this Commonwealth. (2) The term includes a staffing agency that supplies workers to a construction industry employer.
(The Act, Section 2. Definitions)

It is critical that businesses affected by the Act consider the effects of E-Verify on their recruiting and employment now, instead of after it takes effect. This is a big change because it not only adds an additional step to employee onboarding processes, it adds another enforcement layer to an already challenging employment compliance environment. Employers are already subject to enforcement actions on the Federal level, such as, but not limited to: Social Security Administration Requests for Employer Information, Immigration and Customs Enforcement (ICE) worksite enforcement, Office of Fraud Detection and National Security (FDNS) administrative site visitsForm I-9 Audits, and U.S. Department of Labor investigations. With the implementation of the Act, it is no longer only the federal government that construction employers need to consider in managing hiring, employment, and terminations. Pennsylvania construction sector companies will also need to consider DOLI enforcement.

All employers, regardless of the industry, are required to verify an individual’s authorization to work in the United States. This is accomplished by completing Form I-9, Employment Eligibility Verification with every new employee upon hiring. However, because there are no annual reporting requirements for Forms I-9 (such as tax filings and Worker’s Compensation reporting, amongst many others), businesses will sometimes fail to verify employment authorization of new hires. Companies must complete Form I-9s in good faith and keep the documents in accordance with a proper and consistent policy, even though the forms do not have to be regularly submitted to any government authority. Consequently, the first time many companies think about their Form I-9 compliance is when the government is requesting documents and threatening to assess penalties.

Ostensibly, the Act is meant to ensure that all Pennsylvania construction and trades companies are employing authorized workers and providing mandated employee protections. The Philadelphia Inquirer notes that “[t]he building trades pushed for the law, as is standard building trades practice, believing it will lead to more work for their members” and cites to reports which suggest that 15-25% of all Philadelphia construction workers are undocumented and unprotected by standard worker programs like unemployment insurance. (See: New Pa. law requiring immigration checks on construction workers shows labor’s identity crisis, The Philadelphia Inquirer, by Juliana Feliciano Reyes, November 25, 2019.)

For any company fitting within the definition of “construction” in the Act (as noted above), the next year is going to require careful, deliberate adaptation to these new regulations. Construction businesses, unless they already utilize E-Verify, are required to act—they cannot “do nothing”, they cannot continue to employ unauthorized workers, and they will have to compete with companies who are also having to adapt to employing only authorized workers.

Companies which recognize the importance of maintaining compliance can take substantive steps during this intervening year to be ready for when the Construction Industry Employee Verification Act becomes effective on October 6, 2020:

  1. Verify or re-verify the status of the workforce. (NOTE: This action should be done with the assistance of legal counsel);
  2. Enroll in E-Verify, designate company officials who are going to use the system and verify compliance, and develop expertise to ensure compliance is maintained (NOTE: In most circumstances, you cannot use E-Verify to check the status of already employed workers);
  3. Take stock of the company’s recruiting, hiring, employee documentation, and termination policies and protocols. Assess whether policies and procedures serve organizational needs and place the company in the right place to recruit and retain high-quality authorized workers;
  4. Look at job descriptions and compensation levels to identify organizational changes that may make the company more competitive in hiring and retaining employees with authorized status; and
  5. Take a serious look at compensation practices to make sure that the company is in compliance with state and federal law regarding wage and hour.

Attention to these issues can place companies in a better position to deal with regulatory challenges. Such companies will be far less likely to see ICE worksite enforcement or Department of Labor (DOL) Wage and Hour investigations. Should ICE, DOL, or any other agency show up, the companies who are proactive will be ready to demonstrate compliance. Using this time period to a construction company’s advantage can place forward-looking organizations in a better position than their competition to employ the best workers available.

Medical Marijuana Users are Eligible for Unemployment Compensation in Michigan
The Michigan Medical Marijuana Act (MMMA) grants qualified medical marijuana users who are using marijuana in accordance with the MMMA immunity from “arrest, prosecution, or penalty in any manner.” Such users may not be denied any right including being subject to civil penalty or disciplinary action by a business or occupational or professional licensing board or bureau. Several years ago, in Braska v. Challenge Manufacturing, the Michigan Court of Appeals held that medical marijuana use will not disqualify a person from receiving unemployment benefits if that person tests positive for marijuana while holding a valid registry identification card issued under the MMMA. In Braska, several employees had tested positive for marijuana and were terminated. The Court explained that, because the employees were registered users of medical marijuana and there was no evidence that the positive drug tests had been caused by anything other than their lawful use of medical marijuana, the employees were not disqualified from receiving unemployment benefits. Holding otherwise and denying unemployment benefits, the Court said, would constitute an improper penalty under the MMMA. So absent evidence that the employees had ingested marijuana in the workplace or had worked under the influence of marijuana, they qualified for unemployment benefits.

The Michigan Unemployment Insurance Agency has since issued guidance on its website explaining the three scenarios in which an employee who uses medical marijuana will be disqualified from receiving unemployment benefits. The employee will be disqualified if: (1) a positive drug test for marijuana was caused by the ingestion of marijuana at the workplace; (2) discharge is based on the fact that the employee was under the influence of marijuana at the workplace; or (3) the employee is unable to demonstrate that he or she is a qualifying patient who has been issued and possesses a registry identification card under the MMMA. When the use of medical marijuana is asserted to avoid a disqualification, the Agency will request a copy of the employee’s valid registry identification card.

The term “under the influence” is not defined in the MMMA. Consequently, the Agency explained that “fact finding will seek material facts which demonstrate that an individual’s use of medical marijuana put the safety of persons or property at risk.” The Agency stated that it will continue to provide all parties protest and appeal rights of its (re)determinations where any party disagreeing with the Agency’s (re)determination may protest or appeal the decision as warranted.

Recreational marijuana is now legal in Michigan as a result of Proposal 1’s passage in November 2018. However, Proposal 1 does not provide the same protections for recreational users as the MMMA provides for medical marijuana users. Proposal 1 does not prohibit an employer from disciplining an employee for violation of a workplace drug policy or for working while under the influence of marijuana. Nor does Proposal 1 prevent an employer from refusing to hire, discharging, disciplining, or otherwise taking an adverse employment action against a person with respect to hire, tenure, terms, conditions, or privileges of employment because of that person’s violation of a workplace drug policy or because that person was working while under the influence of marijuana. Given this, it is unlikely that an employee who tests positive for recreational marijuana user will qualify for unemployment compensation benefits.

Illinois Governor Signs Employer-Friendly Amendments to Recreational Marijuana Law
On June 25, 2019, Governor J. B. Pritzker signed legislation making Illinois the eleventh state to approve marijuana for recreational use. Recreational use of marijuana will be permitted by law beginning January 1, 2020. The Illinois Cannabis Regulation and Tax Act (the “Act”) explicitly permits employers to adopt “reasonable” zero-tolerance or drug-free workplace policies, so long as such policies are applied in a nondiscriminatory manner. When the Act was initially passed, employers expressed concern that they might have to prove an employee was under the influence of cannabis when an employee failed a drug test. Employers also expressed concern regarding whether they could conduct random drug tests.

In order to address these issues, the Illinois General Assembly amended the Act via a trailer bill, Senate Bill 1557, during the fall legislative session. On December 4, 2019, Governor Pritzker signed the legislation into law as Public Act 101-0593. The changes took effect with the governor’s signature. The amendments clarify an employer’s ability to conduct pre-employment and random drug tests (employers may also conduct reasonable-suspicion and post-accident tests), and to take action due to a failure of a drug test. The amendments specifically provide, “Nothing in this Act shall be construed to create or imply a cause of action for any person against an employer for actions taken pursuant to an employer’s reasonable workplace drug policy, including but not limited to subjecting an employee or applicant to reasonable drug and alcohol testing, reasonable and nondiscriminatory random drug testing, and discipline, termination of employment, or withdrawal of a job offer due to a failure of a drug test.” 410 ILCS 705/10-50 (e)(1). Despite this employer-friendly amendment, workplace drug policies still must be both reasonable and nondiscriminatory. While the amendments clarified several concerns expressed by employers, the amendments did not address what a “reasonable” policy is. As such, employers may want to review their workplace drug policies and give additional thought to standards of reasonableness.


Court Cases

End of the Road: Eighth Circuit Upholds $3.3 Million Fee Award Against the EEOC For Frivolous Claims
Synopsis: After over a decade of litigation between the EEOC and trucking company CRST Van Expedited, the Eighth Circuit recently affirmed a federal district court’s order requiring the EEOC to pay $3.3 million in attorneys’ fees to CRST for pursuing claims that it knew or should have known were frivolous and failing to satisfy its pre-suit obligations under Title VII. As such, it is the largest fee award entered against the Commission in 2019.The ruling is EEOC v. CRST Van Expedited, Inc., No. 18-1446 (8th Cir. Dec. 10, 2019).

Case Background
The case began in 2007 when the EEOC filed suit against CRST after a female driver alleged that two male trainers sexually harassed her during a training trip. The EEOC eventually sued CRST under § 706 on behalf of a group of approximately 270 female employees, claiming that CRST was responsible for severe or pervasive sexual harassment and that it subjected its female employees to a hostile work environment. The district court ultimately barred the EEOC from seeking relief for individual claims on behalf of all but 67 of the women, found that the EEOC had not established a pattern or practice of tolerating sexual harassment, and dismissed the suit. Finding that CRST was the prevailing party and that the EEOC had failed to satisfy its pre-suit obligations, the district court entered a startling attorneys’ fee sanction of nearly $4.7 million against the EEOC.

On appeal, the Eighth Circuit affirmed the dismissal of all claims but those pertaining to two women and vacated the fee award, determining that CRST was no longer the “prevailing party” because the EEOC now had active claims. On remand, the EEOC settled one claim and withdrew the other. Thereafter, CRST again sought attorneys’ fees and was again awarded over $4 million. However, on the second appeal, the Eight Circuit again reversed the district court’s fee award, holding that CRST was not a prevailing party under Title VII because the dismissal of the claims concerning EEOC’s failure to satisfy its pre-suit obligations was not a ruling “on the merits.” In addition, the Eighth Circuit reversed the fee award because the district court failed to make individualized findings in granting summary judgment against the other 78 women. The Eighth Circuit directed the district court to make such individualized findings and barred it from awarding fees for the claims that had been dismissed as a result of the EEOC’s failure to satisfy its pre-suit obligations. CRST appealed the ruling to the U.S. Supreme Court, which reversed and remanded. The Supreme Court held that a favorable judgment on the merits is not a requirement to be a “prevailing party” for purposes of awarding attorneys’ fees. On remand, the Eighth Circuit vacated its prior judgment and remanded back to the district court for additional proceedings consistent with the Supreme Court’s opinion. In 2017, the district court, after engaging in individualized inquiries, found that most of the EEOC’s claims on behalf of 78 claimants for sexual harassment were “frivolous, unreasonable, and/or groundless.” It further found that the dismissal of the 67 other claims as a result of the EEOC’s failure to satisfy its pre-suit obligations constituted a “material alteration” of the parties’ legal relationship, thereby justifying a fee award. After settling on a method of fee calculation, which involved a “per-claimant-average-fee,” the district court ultimately issued a fee award of $3,317,289.17. Subsequently, the EEOC appealed the fee award again to the Eighth Circuit.

The Court’s Decision
On December 10, 2019, the Eighth Circuit affirmed the district court’s $3.3 million fee award against the EEOC, holding that the district court did not abuse its discretion in calculating the fee award. Citing the Supreme Court’s Christiansburg opinion (which held that fee awards to a prevailing defendant are permissible if the plaintiff’s lawsuit was “frivolous, unreasonable, or without foundation”), the Eighth Circuit found that, after conducting individualized inquires, the district court did not abuse its discretion in determining that 71 of the claims it had dismissed on summary judgment were frivolous and that a fee award was warranted.

The Eighth Circuit also upheld the district court’s method of fee calculation pursuant to the Fox standard. In  ., 563 U.S. 826 (2011), the Supreme court held that “a court may grant reasonable fees to the defendant” where “the plaintiff asserted both frivolous and non-frivolous claims,” “but only for costs that the defendant would not have incurred but for the frivolous claims.” The Supreme Court made it clear that trial courts have “wide discretion” in applying this standard. The appeals court took no issue with the district court’s fee calculation method, as it determined that the district court “carefully and thoroughly examined the supporting documentation that CRST…provided in support of its fee request” in crafting its calculation.

The EEOC made several arguments against both the determination that it had brought frivolous claims and the method used to calculate the fee award. Most notably, the EEOC argued that its lawsuit was not frivolous because it reasonably believed it had satisfied the Title VII pre-suit requirements and that the district court erred in granting fees because CRST had not established that any fees were incurred solely in defense of a frivolous claim.

The Eighth Circuit rejected the EEOC’s arguments. It opined that the EEOC could not hold a reasonable belief that it satisfied its pre-suit obligations when it actually “wholly failed to satisfy them.” The Eighth Circuit also determined that the district court’s methods of calculating the fee award, which involved subtracting unrecoverable amounts from the original fee award and then creating an average fee per claimant, achieved “rough justice” and was acceptable under Fox. In so holding, the Eighth Circuit reiterated that “frivolous claims may increase the cost of defending a suit in ways that are not reflected in the number of hours billed,” and that CRST was not required “to provide detailed, minute-by-minute documentation of the work it specifically performed on each individual claim that the court has determined are frivolous, unreasonable and/or groundless.”

Implications for Employers
Even despite the reduction in the attorneys’ fees award from $4.7 million to $3.3 million, the Eighth Circuit’s ruling is a stunning victory. This case continues to serve as a warning to the EEOC to avoid rushing through its mandatory pre-suit duties in an effort to catch employers off-guard in litigating claims. When the EEOC engages in these tactics, this ruling can be used by employers to hold the agency accountable

Applying Artificial Intelligence to Background Screening

Artificial Intelligence is changing the world of background screening and helping create more equal employment opportunities.


Within many industries, the talk surrounding artificial intelligence and employment typically leans toward technologies that automate skilled labor and their potential to make some jobs obsolete. But, in the same way, that AI boosts efficiency and accuracy with manual tasks well enough to give humans a run for our money, it creates opportunities for us to be more effective at our jobs and less biased in our analyses of others.


What is Artificial Intelligence and Where Does it Come from Anyway?


Since most of us don’t consider ourselves to be tech-heads, we’ve never considered the who, what, when, where, and why of AI. For decades, we’ve seen it primarily from the perspective of Hollywood science fiction­, as a dark and mysterious future filled with life-like robots and autonomous vehicles. We’ve carried those fearful ideas into the present where AI has become a regular part of the conversation. And, with no better backstory, it almost seems like AI manifested itself to glean knowledge on its fast track to one-up humanity.


In reality, though, AI is just technology built by humans. From computer code to electrical components, everything that drives AI is seeded by people. It can even be programmed to accept information as-is and, when it comes to employment background screening, that should greatly benefit equality in hiring.


Taking the Bias Out of Background Screening


Title VII of the Civil Rights Act of 1964 outlines practices specific to employment, clarifying that it’s illegal to discriminate against someone on the basis of race, color, religion, national origin, or sex. The U.S. Equal Employment Opportunity Commission (EEOC) website even goes so far as to specify how discriminatory practices can come into play throughout a person’s employment, starting with pre-employment inquiries. It seems easy enough to avoid this type of discrimination on paper when, in reality, humans all have unconscious biases and we tend to ascribe them to traits like names, places of birth, previous employers, quirks of language, and so much more. These biases lead to unintentional discrimination and that leads to legal risks.


The easiest way to remove conscious and unconscious human biases from a hiring process like background screening is to apply AI to as many parts of that process as possible. Not only does this increase efficiency by relieving humans of redundant and repetitive administrative tasks, but it also improves accuracy by removing variables of human error, reduces the legal risk for employers, and levels the playing field for applicants by managing information as fact-based categories—nothing more, nothing less. When the bottom line of data analysis is, well, data, there’s no better candidate for the job than AI.


Keeping the Humanity in Hiring        


There may never be a magic wand that completely erases our biases, but you can talk to ClearStar about how our background checks can keep the humanity in hiring and how our future with AI can help your business hire the best candidates without bias.

Continuous Background Screening: A Trend For The New Decade

Hi! I’m Brad Carlson, Chief Revenue Officer at ClearStar, and this is the next installment of For The Public Record—a blog that features thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process.

In discussions with clients today, we are constantly asked about one of the latest trends in the industry—continuous background screening. It’s not a surprise, since today’s quickly changing job market and technology means that more due diligence is required of the employer to ensure a safe working environment for all existing employees and their community.

What’s With The Hype?

Why is this getting so much interest? It really is all about safety and risk. Your employee may engage in illegal activity during the term of their employment. The infraction may be significant and a violation of your hiring guidelines. As a responsible employer, you don’t want to have a person who does not meet your standards working for the company, putting employees, clients, and vendors at risk and exposing your organization to costly negligent hiring litigation.

For example, say you have an employee working as a teacher in a school district. Typically, state law indicates that the employee is prohibited from having a sex offense on their record prior to AND during the term of their employment with the school district. Seems obvious, but many employees, while trying to avoid unemployment and financial hardship, don’t disclose that they have been convicted of a crime. Using ongoing monitoring can identify the conviction during the term of their employment and provide a solid security layer, ensuring company policy is being enforced.

How Does It Work?

What can be found with continuous screening includes criminal convictions (both felonies and misdemeanors) and global sanctions as well as entry onto various watch lists, sex offender registries, and much more.

The key underpinning of any monitoring program is a national source of information. Records are usually updated and/or available on a daily/weekly/monthly basis. With ongoing monitoring, once an infraction is found, the data is then validated at the source to help ensure any records are up to date when reported to the employer.

Before implementing a continuous screening program, the employer needs to have one very important element in place: the disclosure and authorization form. Any program of this nature must be disclosed to the employee and their consent to be monitored during their term of their employment must be on file. This helps ensure a legally compliant program.

Once the release form has been addressed, the employer can provide active employee rosters or insert new employee onboardings programmatically. The employer is responsible for removing individuals that should no longer be monitored.

Should I Start A Continuous Screening Program?

The simple answer? Yes.

For several years, organizations that employ a lot of drivers have been performing annual checks of their driving population. This was originally enforced by the insurance providers, but it has a real safety and risk mitigation component—not to mention it can help save money in the short and long term. The industry awarded lower insurance premiums for companies that did periodic monitoring to ensure their drivers had clean driving records. And it’s likely that they saved boatloads of money on legal fees had one of their drivers been taken to court for irresponsible operation of their vehicle.

Of course, with any program that has this kind of sweeping effect on your existing employees, legal guidance should be obtained.

However, if your goal is to create a safer environment and ensure that employees are truly in compliance with company policy, then continuous background screening is a great solution with real ROI. Talk with your background screening provider to ensure that your program is compliant, has the data sources you need, and most importantly, works seamlessly for your particular organization. This is for the record.

Recreational Marijuana and Workers’ Compensation: What Employers Need to Know

Legal recreational marijuana use by your employees will affect workers’ compensation claims. Is your HR team prepared to handle it?

On Jan. 1, 2020, when Illinois legalizes recreational marijuana use by residents 21 years old or older, it will join 10 other states that have already enacted similar legislation­—Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, Washington, and the District of Columbia, the Northern Mariana Islands, and Guam. Laws in other states vary fairly wildly, from legislation that permits marijuana use for medical purposes only to guidelines that focus solely on CBD and THC content to the decriminalization of possession or what’s permissible for transportation and cultivation.


Nevertheless, times have changed. The only states and U.S. properties that currently do not permit any marijuana use/possession are Idaho, South Dakota, and American Samoa, and that means employers throughout the U.S. need to update expectations, job requirements, and the way they handle workers’ compensation as it relates to marijuana intoxication.


Marijuana Law Amendments for Employer Protection


The original Illinois law—called the Illinois Cannabis Regulation and Taxation Act­—has gotten most of its attention for its provisions regarding use and possession. Of less interest to marijuana users and more interest to employers, of course, is the part of the Act that allows employers to enforce zero-tolerance policies for employees who are on the clock or on call. Additional concerns about employer liability for enforcing marijuana-related policies led to the creation of an amended bill that is expected to be signed into law on Jan. 13, 2020, or sooner.


Once amended, employees will not be able to sue their employers for “actions taken pursuant to an employer’s reasonable workplace drug policy, including but not limited to subjecting an employee or applicant to reasonable drug and alcohol testing, reasonable and nondiscriminatory random drug testing, and discipline, termination of employment, or withdrawal of a job offer due to a failure of a drug test.”


The most difficult part of enforcement for employers, though, especially after an incident or accident, will be proof of the employee’s intoxication. There is still no standard of a “legal limit” or standard method for measuring impairment. That burden of proof will fall on the employer after the fact, which means drug screening and employee vetting at the time of hiring may be the most crucial element to effective drug policy.


Avoid the Fight Against a Marijuana Use-Related Workers’ Comp Claim     


Let ClearStar propel your business with a drug screening program for the modern age. Our experienced, specialized background screening teams and tools can help you hire with complete confidence no matter the changing legal landscape.

How do you recruit the best candidates for your business?

Employees can make or break a business.


The difference between the overall success and failure of a project, a department, or even an entire company can come down to just one individual. How do you recruit the best candidates?


Source efficiently

To start, put your job offerings on the internet in ways that will ensure people actually find it. When you do, make sure that your business is being described in a way that proves it’s a great place to work. It is also essential in our tech-savvy world to enable your site on mobile devices. In addition, listen to and encourage referrals from your already trusted employees regarding new hires.


Respond rapidly

A major complaint amongst job seekers is a lack of communication following application submission. In fact, 52% say they don’t receive any communication 2-3 months after applying. Make your business stand out in a good way by being responsive, especially through text, as 99% of employers’ texts to candidates are opened and 37% receive a response.


Screen creatively

Video screening allows employers to access more candidates more quickly without fewer in-person interviews. Another way to ensure you do not waste the time of a potential hire or yourself is through skill assessments. This ensures employees who would not fit well within your organization do not make their way into it.


Onboard seamlessly

For 30% of employers, the number one reason candidates turn down their job offers is that they’ve already accepted a job with another company. Be that other company by reaching out as soon as a hiring decision is made. It is also important to communicate logistics and answers to FAQs related to your business prior to the hire’s first day.


Engage frequently

Make your current employees feel appreciated by engaging and challenging them, investing in ongoing training opportunities, and communicating with them about job openings in different departments before posting them publicly.

Vet effortlessly

A candidate-friendly, tech-forward background screening process will only grow in importance when attracting and retaining top talent in the new decade. Look for a screening provider that offers solutions to get your candidates in the door with as few steps as possible. Offering candidates a mobile experience with e-signature capabilities as well as a paperless drug screening process with mobile wallet pass are just a few ways ClearStar simplifies the verification process for employers and their candidates.


To read the full list of ways to improve the candidate journey, check out our partner iCIMS. And to discover a screening process that will propel your business, contact us at ClearStar.

ClearStar Named to HR Tech Outlook’s Top 10 HRMS Solution Providers – 2019

ClearStar, a provider of Human Capital IntegritySM technology-based services specializing in background and medical screening, is pleased to announce that it has been recognized as one of the Top 10 HRMS Solution Providers – 2019 by HR Tech Outlook magazine. The company was chosen based on its innovative solutions and demonstration of great promise in their competitive market environment.

HR Tech Outlook magazine, published in Fort Lauderdale, FL, is a technology magazine which gives information about the latest technology in the industry that helps the technology, business leaders, and start-up ecosystems achieve business goals. The list of the Top 10 HRMS Solution Provers is determined by a panel of experts, technology leaders, and board members of HR Tech Outlook magazine after a comprehensive and competitive evaluation of over 500 HRMS solution providers.

“We are delighted to select ClearStar as one of the Top 10 HRMS Solution Providers – 2019,” said Hanna Wilson, Managing Editor of HR Tech Outlook magazine. “ClearStar offers progressive solutions that solve human resource management challenges by implementing the current technological trends in the space.”

Robert J. Vale, Jr., CEO of ClearStar, said: “We are proud to be named a Top HRMS Solution Provider. With each year, the importance of maintaining human capital integrity becomes more apparent, but the task of doing so also grows more difficult. Hiring managers need more than a background screening provider—they need a partner in their goal of attracting, verifying, and deploying top talent as quickly as possible. We design our solutions to be a complete answer to those needs.”

About ClearStar
ClearStar, Inc. is a leading provider of Human Capital IntegritySM technology-based services specializing in background and medical screening. It provides employment intelligence direct to employers and via channel partners/consumer reporting agencies (“CRAs”) to support better recruitment and other decisions affecting employees by increasing the quality, reliability, and visibility of information.

A seven-time Inc. 5000 honoree and founding member of the National Association of Professional Background Screeners, ClearStar has provided innovative technology solutions to businesses in the human capital management industry from its corporate offices in Alpharetta, Georgia since 1995. For more information about ClearStar, please visit:

November 2019 Screening Compliance Update

Federal Developments

FMSCA-Regulated Employers Take Note: Drug and Alcohol Clearinghouse Implementation Quickly Approaching
In 2012, Congress enacted and President Obama signed the “Moving Ahead for Progress in the 21st Century Act,” a transportation reauthorization bill referred to as “MAP-21.” That law directed the Federal Motor Carrier Safety Administration (FMCSA) to create a means of identifying and tracking commercial drivers who violate the agency’s drug and alcohol testing program, to ensure that drivers with a history of violating the drug and alcohol regulations are taken off the road until they demonstrate compliance with those rules. On January 6, 2020, nearly eight years later, a FMCSA database called the Commercial Driver’s License Drug and Alcohol Clearinghouse (Clearinghouse) will launch. As of this date, employers that use commercial drivers must observe new reporting and query requirements adopted to implement this ambitious safety rule. The Clearinghouse will enable employers to more easily identify drivers who commit a drug or alcohol program violation while working for one employer, but who fail to subsequently inform another employer. Records of drug and alcohol program violations will remain in the Clearinghouse for five years, or until the driver has completed the return-to-duty process, whichever is later. Compliance with Clearinghouse reporting and query requirements is mandatory to achieve a compliant FMCSA drug and alcohol program.

Driver Drug and Alcohol History Inquiries
The FMSCA is the federal agency within the Department of Transportation (DOT) that enforces drug and alcohol testing rules and regulations for employees who drive commercial trucks and buses, as well as vehicles that carry hazardous materials. These regulations apply to any driver who holds a commercial drivers’ license and set out drug and alcohol testing requirements in addition to general rules on drug and alcohol use. The regulations also provide detailed instructions on the steps Covered Drivers must complete if they violate those regulations and wish to resume performing safety-sensitive driving work for any employer. Covered Drivers who have committed drug and alcohol violations are ineligible to operate a commercial motor vehicle on public roads until they have completed a federally mandated return-to-duty process. Before the creation of the Clearinghouse, every FMSCA-regulated employer has been required to take proactive steps to verify the drug and alcohol testing record of any Covered Driver about to begin performing safety-sensitive functions (either as a new hire or via internal transfer), primarily by querying the driver’s prior employers. If the record showed that the Covered Driver previously violated a drug and alcohol testing regulation, the employer could not allow the driver to perform a safety-sensitive function until the employer confirmed that the driver successfully completed mandatory return-to-duty requirements.

New Query and Reporting Requirements
The rule implementing the Clearinghouse does not change any existing drug and alcohol testing requirements for DOT-regulated workplace drug and alcohol testing but adds mandatory reporting and review requirements. FMSCA-regulated employers will now be required to track and report the following information directly to the Clearinghouse on an ongoing basis:

  • Any drug or alcohol confirmation test result with an alcohol concentration of 0.04 or greater;
  • Any refusal to submit to a DOT test for drug or alcohol use (including by submitting adulterated or substituted results, or failing to comply with the testing process without medical excuse);
  • Actual knowledge that a Covered Driver used illegal drugs or used alcohol before duty, while on duty, or following a workplace accident in violation of FMSCA regulations;
  • Negative return-to-duty test results; and
  • Confirmation that the Covered Driver successfully completed all follow-up tests ordered by the Substance Abuse Professional.

The Clearinghouse rule also requires Medical Review Officers, Substance Abuse Professionals, consortia/third-party administrators and other service agents retained by employers to report to the Clearinghouse information related to drug and/or alcohol program violations and the return-to-duty process.

These reports will be compiled in a secure electronic database of information that will allow the FMSCA, as well as FMSCA-regulated employers, to identify Covered Drivers who have violated federal drug and alcohol testing program requirements. As the database grows over time, it will therefore become easier to assess whether an individual is eligible to perform safety-sensitive functions or whether the required return-to-duty process has been completed by individuals who previously violated the FMSCA regulations. Unfortunately, employers must also continue to independently gather driver drug and alcohol program compliance records directly from prior and prospective employers until the Clearinghouse has been operating for three years, which is the look-back period for new driver queries on drug and alcohol program compliance. FMCSA-regulated employers will be obligated to query the Clearinghouse database whenever the employer “uses” a driver for the first time.3 The employer is expected to proactively review the information in the Clearinghouse to ensure that prospective Covered Drivers are compliant and allowed to perform safety-sensitive functions in accordance with FMSCA regulations. Specifically, employers must query the Clearinghouse before permitting a specific Covered Driver to operate a commercial motor vehicle on public roads. Employers are also required to query the Clearinghouse annually for each Covered Driver they employ to ensure ongoing compliance. In order to query the Clearinghouse, an employer must obtain the consent of the driver in advance. Consents to initial, or “limited” queries can be evergreen, and allow the employer to continue to query the Clearinghouse as needed (for example, on an annual basis) after the driver’s initial check. If the query identifies a relevant report on a driver in the database, however, the driver must at that time and on an individual basis authorize the release of the full query report to the employer. Failing to authorize the release of these records to the querying employer will prevent the employer from using or continuing to use the driver.

As an FMSCA-Regulated Employer, What Must You Do?
In anticipation of the implementation date, FMSCA-regulated employers should begin the process by registering with the Clearinghouse and purchasing a “Query Plan,”4 which is essentially a credit program for a set number of queries. The Clearinghouse website also contains a set of “FAQs” or frequently asked questions to help regulated employers and their drivers become familiar with the process. Once the database “goes live” on January 6, 2020, FMSCA-regulated employers must initiate a query as part of the onboarding process for new Covered Drivers and must complete this process before allowing a Covered Driver to begin performing safety-sensitive functions. Drivers need not register with the Clearinghouse unless or until there is information in the database for which they will need to authorize a release to current or prospective employers. Employers may want to encourage drivers to create an account, however, as doing so will streamline the process by which a new driver can be hired or returned to work following a report on a limited query requiring the driver to authorize the full query report. FMSCA-regulated employers must also be aware of their obligation to identify and submit information to the Clearinghouse and set up processes to capture and report this information. In some cases, the employer may need to create reports documenting support for a report of a violation. For example, supporting documentation will be required when an employer reports actual knowledge of FMSCA drug and alcohol rules, such as a statement from a supervisor who saw the driver engage in prohibited conduct, or documenting a driver’s admission or a regulatory violation. Similarly, documentation may accompany a report of a refusal to submit to required drug and/or alcohol testing. The employer must also ensure that all of the information reported to the Clearinghouse was also provided to the Covered Driver in question, and so certify. This process is designed to ensure that Covered Drivers are able to exercise their right to dispute potentially inaccurate information. Although an employer can empower its third-party administrator and others involved in the administration of its FMCSA drug and alcohol program to assist in making these reports, the employer bears the ultimate responsibility to recognize and report required information to the Clearinghouse. Clearinghouse records are also made available to state driver licensing agencies.

On an annual basis, FMSCA-regulated employers also will need to submit a query regarding all Covered Drivers used, to ensure ongoing compliance with FMSCA regulations. As with existing Motor Vehicle Records (MVR) annual review requirements, the Clearinghouse must be queried at least once for each Covered Driver within 365 days of their hire date, or within another 12-month period as determined by the employer. The employer has some flexibility as to the timing of the query it wishes to conduct but should be aware of how its decision may affect its everyday operations. For example, if an employer elects to run all covered drivers at once as part of its annual review, and the limited query reveals information necessitating a full query on certain drivers, the employer must then conduct a full query on each of those drivers within 24 hours. If the employer fails to conduct a full query within 24 hours—recognizing that the employer must obtain specific consent from the driver to do so within this time period—the employer cannot allow the Covered Driver to continue to perform any safety-sensitive function until the results of the full query confirm that the Covered Driver’s Clearinghouse record is clear. Employers should therefore be wary about the potential disruptions this can create in the workplace and be prepared to respond accordingly.

Finally, employers are obligated to notify drivers of the Clearinghouse requirements. Specifically, Covered Drivers must be notified of the requirement that personal information collected and maintained pursuant to the FMCSA regulations will be reported to the Clearinghouse, including: (i) any verified positive, adulterated, or substituted drug test result; (ii) an alcohol confirmation test with a concentration of 0.04 or higher; (iii) a refusal to submit to any test required by the regulations; (iv) an employer’s report of actual knowledge, as defined in the regulations, of on-duty alcohol use; pre-duty alcohol use following an accident; and controlled substance use; (v) a substance abuse professional report of the successful completion of the return-to-duty process; (vi) a negative return-to-duty test; and (vii) an employer’s report of completion of follow-up testing. Employers can provide this information through an updated policy or a special educational communication to the drivers they use.

In a Historic Move, House Judiciary Committee Moves to Federally Legalize Cannabis
On November 20, 2019, the House Judiciary Committee approved a bill that would decriminalize cannabis on a nationwide scale. The Marijuana Opportunity, Reinvestment and Expungement Act of 2019—or MORE Act—passed with what some are calling a landslide vote of 24-10, with two Republicans—Representatives Matt Gaetz (R-FL) and Tom McClintock (R-CA)—crossing party lines to join in supporting bill. This vote marks the first time in history a congressional committee has affirmatively approved to end federal cannabis prohibition. The committee markup of the MORE Act is historical in and of itself, as it represents the first debate that was not centered on whether cannabis prohibition should be abolished, but, instead, focused on implementation of a policy that would ultimately accomplish cannabis legalization.

The MORE Act would remove cannabis from the list of Schedule 1 controlled substances identified in the Controlled Substances Act. The MORE Act would also: (i) allow states to set their own cannabis-related policy, eliminating federal intervention; (ii) require federal courts to expunge prior convictions for cannabis-related offenses; and (iii) establish a 5% tax on cannabis product sales to establish a trust fund to reinvest in communities disproportionately impacted by the “war on drugs.” Proponents argue that the MORE Act would result in significant policy change that would, among other things, create a pathway for resentencing those incarcerated on cannabis-related offenses, protect immigrants from being denied citizenship over cannabis use, and prevent federal agencies from denying public benefits, such as housing, or security clearance due to an individual’s cannabis use.

Historically, the debate on cannabis has generally followed two tracks. The MORE Act was no different. Republican committee members argued that the bill was rushed and should be subject to additional hearings. Democratic lawmakers countered the debate on cannabis has been raging since the 1970s and the time is nigh to reverse decades-long harms incurred enforcing strict prohibition.

It stands to reason that the legislation, which House Speaker Nancy Pelosi supports, has a high chance of approval in the full House where Democrats maintain control with 234 seats. However, the bill will face a tougher battle in the Republican-controlled Senate, where Majority Leader Mitch McConnell opposes cannabis legalization. Senate passage will likely depend on the compromises Democrats are willing to make. It is also important to note that prior to a vote on the House floor, several committees could claim jurisdiction to consider the bill first, including the House Energy and Commerce Committee. It is possible the bill will be further amended and potentially delayed before reaching the House floor.

Admittedly, some Republican committee members openly recognize that prohibition is no longer workable and that federal law should change regardless of personal opinions on cannabis. These representatives pushed for the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act—an alternative bipartisan cannabis bill that does not contain social equity elements or formally remove cannabis from the Controlled Substances Act. Instead, the STATES Act largely leaves cannabis policy up to the states. There is an argument to be made that this “scaled-down approach” would have a better chance of Senate approval. MORE Act supporters counter that, because the STATES Act does not de-schedule cannabis, it does not sufficiently address key issues including banking and veterans’ access.

The House Judiciary Committee’s approval comes two months after legislation that would protect banks that serve cannabis businesses in states where the substance is legal.

Consumer Financial Protection Bureau Settles With Employment Background Screening Company
The Consumer Financial Protection Bureau (Bureau) filed a proposed stipulated judgment with Sterling Infosystems, Inc. to resolve allegations that Sterling violated the Fair Credit Reporting Act (FCRA). Sterling is a privately-held Delaware corporation headquartered in New York whose primary business is to prepare background screening reports on individual job applicants to assist employers in employment-making decisions. If entered by the court, the stipulated judgment will require Sterling to pay monetary relief to consumers and a civil money penalty and prevent Sterling from engaging in the allegedly illegal conduct again. In its complaint, filed in the federal district court in the Southern District of New York, the Bureau claims that Sterling violated the FCRA by failing to employ reasonable procedures to ensure the maximum possible accuracy of the information it included in the consumer reports it prepared. Specifically, the Bureau alleges that Sterling’s procedures created a heightened risk that its consumer reports would include criminal records belonging to another individual with the same name as the applicant. The Bureau also alleges that Sterling had a practice of including “high-risk indicators” in its reports without taking any steps to verify the accuracy of them. These “high risk indicators,” which Sterling obtained from a third party, characterized addresses that the consumer may have lived at as “high risk.” The Bureau also claims that Sterling violated the FCRA by failing to maintain strict procedures to ensure that public record information that it included in the consumer reports was complete and up to date or notify consumers, at the time that such information was reported, of the fact that public record information was being reported. The Bureau also claims that Sterling violated the FCRA by reporting criminal history information and other adverse information about consumers outside of the allowable reporting period.

If the proposed stipulated judgment is entered by the court, Sterling will be required to pay $6 million in monetary relief to affected consumers and a $2.5 million civil money penalty to the Bureau. The proposed stipulated judgment also includes injunctive relief to prevent the claimed illegal conduct from recurring.
The complaint is available at:
The proposed stipulated final judgment and order is available at:

Pay Equity Litigation Update: How the EEOC has Pursued its Equal Pay Focus in Fiscal Year 2019
Since 2012, the EEOC has included equal pay protections as one of its six substantive area priorities in its Strategic Enforcement Plan (“SEP”). The SEP guides the EEOC’s enforcement activity in terms of the types of lawsuits it brings and the theories of law that it champions and pursues.

The EEOC reports—and our yearly analysis has consistently confirmed—that the six priorities identified in the SEP are lightning rods for increased EEOC litigation and are more often the subject of the agency’s conscious, directed development of the law. For that reason, we believe that employers are well advised to understand how the EEOC interprets and applies its enforcement priorities, as they tend to be a reliable guide to the types of employers, industries, and business practices that the EEOC is actively targeting. This post will describe the legal developments in FY 2019 within the EEOC’s equal pay priority.

EEOC Litigation Developments In 2019
Equal Pay Act cases are often highly fact-driven and therefore notoriously difficult for employers to scuttle with pretrial motions. Several recent decisions arising out of EEOC-initiated litigation are illustrative of this trend.

For example, in EEOC v. Enoch Pratt Free Library, No. 17-CV-2860, 2019 WL 5593279 (D. Md. Oct. 30, 2019), the District Court for the District of Maryland denied the EEOC’s and the employer’s cross-motions for summary judgment. With respect to the motion filed by the EEOC, the District Court found that genuine issues of material fact persist regarding elements of the EEOC’s prima facie case. Id. at *5. In particular, the District Court held that the evidence showed that employees within the charging party’s position, library supervisors, perform a wide variety of job duties across various library branches: “Overall, the branches generally have varying responsibilities in light of their different physical plants, different clientele, and different community resources…A factfinder should therefore assess whether the duties performed by [supervisors] are sufficiently similar to establish a prima facie case of unequal pay for equal work.” Id.

With respect to the employer’s motion, the District Court applied the reasoning of a recent decision out of the Fourth Circuit, EEOC v. Maryland Insurance Administration, 879 F.3d 114, 124 (4th Cir. 2018). The EEOC alleged that the employer paid three former female fraud investigators less than it paid four former male fraud investigators with comparable credentials and experience. The Fourth Circuit held that the EPA requires “that an employer submit evidence from which a reasonable factfinder could conclude not simply that the employer’s proffered reasons could explain the wage disparity, but that the proffered reasons do in fact explain the wage disparity.” Id. at 129. The employer argued that it could not have discriminated against the charging parties because it used the state’s Standard Salary Schedule, which classifies each position to a grade level and assigns each new hire to a step within that grade level. The Fourth Circuit rejected this defense because it found that the employer exercised discretion each time it assigns a new hire to a specific step and salary range based on its review of the hire’s qualifications and experience.

In Enoch Pratt Free Library, the employer had also argued that any wage differential was due to a factor other than sex, rather than due to discrimination, based on its use of a facially neutral salary scale, the Managerial and Professional Society Salary Policy (“MAPS”), to determine compensation for newly hired library supervisors. 2019 WL 5593279, at *6. The District Court held, however, that that policy did not necessarily compel any specific salary to be awarded to a new hire because it left open the possibility that the employer could apply discretion with respect to setting starting salaries. Id. Applying Maryland Insurance Administration, the District Court concluded that “[the EEOC’s comparator] was hired at a rate not only higher than the female [library supervisors] represented by the EEOC, but also significantly above the salary he had received during his first tenure at [employer]. Given these facts, combined with the inherent discretion within the MAPS policy, genuine factual questions exist about how defendants arrived at [the comparator’s] salary.” Id. at *7.

An employer’s burden at the motion to dismiss stage is even higher. For example, in EEOC v. George Washington University, No. 17-CV-1978 (CKK), 2019 WL 2028398 (D.D.C. May 8, 2019). the District Court for the District of Columbia denied an employer’s motion to dismiss even though the complaint at issue did not explicitly allege how the positions at issue were equal with respect to skill, effort, and responsibility. In that case, the EEOC had brought a lawsuit on behalf of a female university Director of Athletics, who alleged that a male colleague was treated more favorably and given greater opportunities because of his sex. Id. at *1. The University allegedly advertised a new position in its athletics department, but plaintiff had been informed that the job was off-limits to her because the University had already decided to hire her male coworker. Id. at *2. The position paid far more than plaintiff’s position.

The University moved to dismiss the complaint. The District Court held that the complaint “straightforwardly pleads that [plaintiff] was paid less as Executive Assistant than [comparator] was paid as a Special Assistant for substantially the same job responsibilities.” Id. at *4. The Court held that there was no reason for the complaint to get into the equal skill, effort, and responsibility, or other similar working conditions of those two positions, because at the motion to dismiss stage, a court cannot dismiss a complaint even if the plaintiff did not plead the elements of a prima facie case.


State Developments

New Legislation Precludes Employers in Puerto Rico From Using Credit Reports or Credit History to Take Employment Actions
On October 8, 2019, the Governor of Puerto Rico signed into law Act No. 150 of October 8, 2019 (“Act 150” or “the Act”), which prohibits employers from, among other actions, verifying or investigating credit history or credit reports concerning current employees or employment candidates, or from obtaining or ordering such reports from a credit agency. The Act further prohibits employers from taking adverse employment actions based on an employee’s or employment candidate’s credit history or report. Act 150, however, provides a list of exceptions to its coverage, including management positions, positions in the Department of Justice or the Judicial Branch, public order officials, and positions that have access to trade secrets (as defined under Puerto Rico Act 80-2011), financial or personal information, or cash or other goods subject to misappropriation totaling at least $10,000. Positions that are regulated by the Puerto Rico Office of the Commissioner of Financial Institutions or for which a credit report is required by federal law are also exempt from Act 150’s provisions. When these exceptions apply, employers must obtain written consent from the employee or employment candidate in order to be able to request their credit history or report. Employers must ensure that their employment practices are consistent with Act 150. Otherwise, employers that violate the Act may be subject to administrative penalties of up to $2,500 for each violation. The Act took effect immediately upon the Governor’s signature (October 8, 2019).

New Pennsylvania Medical Marijuana Lawsuit May Someday Provide Guidance to Employ
Q: Are there any new cases involving Pennsylvania’s Medical Marijuana Act in the context of employment?
A: Given that state-sanctioned use of medical marijuana is relatively new, there are few cases interpreting Pennsylvania’s medical marijuana law with regard to employment. This is why the a recently filed Pennsylvania lawsuit could have a far-reaching impact on employers.

On October 10, 2019, Derek Gsell of Moon Township, Pennsylvania filed a lawsuit against a Pennsylvania electric company (the “Company”) in the Court of Common Pleas of Allegheny County, Pennsylvania, docketed as No. GD-19-014418. Mr. Gsell alleges that the Company improperly rescinded a job offer because he tested positive for THC (the active ingredient in marijuana) in a pre-employment drug test. As he informed the Company, Mr. Gsell possesses a Pennsylvania medical marijuana card, which allows him to legally purchase and use marijuana for medical purposes. According to the complaint, the Company offered Mr. Gsell employment in August 2019; however, the offer was “contingent upon successful completion of a criminal background check, reference check, and pre-employment drug screen.” Mr. Gsell underwent a pre-employment hair follicle drug test and he was informed that he had “failed” the test due to the detection of THC. The complaint states that written correspondence from the Company informed Mr. Gsell that the job offer was rescinded and the position was “no longer available due to your positive drug screen results.” In his complaint, Mr. Gsell claims that the Company acted with “malice or reckless indifference” to his rights under Pennsylvania’s Medical Marijuana Act (“PMMA”), which established the state’s medical marijuana program in 2016. Mr. Gsell alleges that his job offer was rescinded solely because he was certified to use medical marijuana, noting that he did not seek to use medical marijuana on the Company’s property or to be under the influence of marijuana while at work.

The PMMA permits the use and possession of medical marijuana in authorized forms by patients with a practitioner’s certificate who suffer from a serious medical condition. Possession is lawful for patients and caregivers who have a valid identification card. The Act provides protections for employees certified to use medical marijuana and in particular, it prohibits employers from discriminating or taking an adverse action against an employee “solely on the basis of the employee’s status as an individual who is certified to use medical marijuana.”

Given the limited issues presented in Mr. Gsell’s one-count complaint, this lawsuit will likely be a good test case for enforcing an employee’s (or a prospective employee’s) rights under the PMMA. The Company has not yet filed a response to the complaint.

Florida Legislature to Consider Bill Protecting Rights of Medical Marijuana Users
A Florida state senator has put forward a bill to protect medical marijuana users from workplace discrimination, including firings for positive drug tests, as discrimination lawsuits follow the trend of legalization across the country. The introduction of Senate Bill 962 is in response to numerous lawsuits filed by workers who were terminated from their jobs for cannabis use. Several states with legalized medical marijuana have protections for users in the workplace, including barring employers from using positive test results to decide on hiring or firing unless the user is bringing their marijuana to work or they work in an environment where safety is a concern. The proposed bill incorporates protections similar to those afforded to workers in other states, such as Arizona, Maine and Minnesota. In the proposed bill, employers still would be able to punish workers who possess or use medical marijuana during normal business hours. And jobs with “safety-sensitive” duties, such as work with hazardous materials or work that involves carrying a firearm, are exempt from the proposed rules.

Additionally, the proposed bill would permit employers with drug test policies to have five days to provide written notice to applicants who test positive for marijuana or its metabolites, explaining the applicant’s right to provide an explanation for the positive test result. The applicant or employee would then have five business days to submit information explaining or contesting the test result, or to request a confirmation test. According to the text of the proposed bill, employers may take “adverse personnel action” against any employee if the employer has evidence that the medical marijuana use is impairing the worker’s ability to perform his or her job responsibilities.

The proposed bill highlights the inherent conflict between the rights of the individual to accept and undergo treatment for legitimate medical conditions in contradiction to employers’ desire to have a “drug-free” working environment in order to maintain certain standards of work quality and safety.

A similar bill was introduced in the Florida House of Representatives in early November 2019. Both the Florida House of Representatives and Florida State Senate are expected to consider the respective bills in the 2020 legislative sessions.

Saliva Instead of Urine for Drug Testing?
More employers will drug test their employees as an unintended consequence of the legalization of recreational marijuana. Recently, the federal government posted guidelines for federal employers who use “oral fluid specimens.” Illinois employers should consider testing “oral fluid specimens” instead of urine.

What are Oral Fluid Specimens?
An oral fluid specimen is collected from an employee’s oral cavity (“mouth”) and it is a combination of physiological fluids (“saliva” or “spit”) produced primarily by the salivary glands.

What Advantages Derive from Testing an Employee’s Saliva?
Urine testing has been the “go to” testing standard for drug and alcohol use since 1988. Urine testing has a variety of problems while saliva testing has various advantages:

  • Some employees have a hard time producing a urine sample because of a legitimate medical condition. A limited urine specimen can produce an invalid result, or the test may need to be rescheduled.
  • Urine collection requires use of a specialized collection facility, secured restrooms, same gender oversight, and other special requirements. Saliva may be collected in various settings.
  • Up to 3% of unobserved urine collection samples are substituted or adulterated. Since all saliva samples can easily be observed, this should reduce the risk that a sample is tainted.
  • Collecting saliva requires less time than collecting urine. This results in less employee time away from the workplace. Saliva collection may occur at or near the workplace which means there should be no travel time for the employees. The federal government estimates that saliva collection costs $38.00 to $114.00 less per test than urine collection.
  • Saliva collection may be more accurate than urine testing with respect to recent drug use. This is particularly important as employers try to differentiate between legal usage off-duty, and illegal usage on-duty.

Employers concerned about the impact of recreational marijuana on their workforce must promulgate a written policy. This policy should describe when and how drug testing will occur. Moreover, employers must publish their policy either through a company intranet, bulletin board or handbook. Presumably, some aspect of every employer’s policy will contain a drug testing component. For 30 years, testing urine has been the standard. Testing saliva may now be the better option.

Year-End Reminder: New Jersey’s Salary History Ban Takes Effect January 1, 2020
In just a few short weeks, New Jersey employers will no longer be allowed to ask prospective employees about their salary history during the application or interview process or rely upon salary history in setting compensation. The rationale for the new statewide law is that setting compensation based on prior salary may perpetuate an unlawful pay disparity. By excluding salary history from the mix, employers will only be able to set compensation based on lawful considerations, including the specific job duties of the position and the applicant’s skill, education, training, and experience.


Court Cases

Dollar General Reaches Settlement With the EEOC in Years-Long Background Check Bias Suit
Employers should continue to exercise caution and care in drafting their criminal record screening policies. A recent settlement by Dollar General underscores this point, even though it comes on the heels of the Fifth Circuit’s opinion holding that the EEOC violated the federal Administrative Procedure Act (APA) in issuing its 2012 Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964. The EEOC and Dollar General recently resolved the EEOC’s six-year lawsuit against the retailer arising under Title VII of the Civil Rights Act of 1964 (Title VII) for $6 million dollars and other programmatic relief.

In 2013, the EEOC filed suit, alleging that the company’s use of criminal background checks disparately impacted African-American applicants in violation of Title VII. The lawsuit alleged that the retailer violated Title VII due to the purported “gross disparity in the rates at which Black and non-Black conditional employees were discharged.” Though a federal court in Illinois ruled for the EEOC during some discovery disputes, the federal court never ruled against the company on the substance of the EEOC’s claims, nor has the company admitted any liability. The company has, rather, steadfastly denied liability.

The parties mediated the matter on September 11, 2019. On October 28, 2019, the parties submitted a Consent Decree (“Decree”) to the federal court in Illinois for approval. The Decree, which will be in effect for three years, requires programmatic relief in addition to a monetary payment. Specifically, the retailer can continue to consider applicants’ and employees’ criminal conviction history for employment purposes only if it agrees not to violate anti-discrimination and anti-retaliation laws, and if it complies with numerous requirements, including:

  • retaining a criminal history consultant to evaluate its use of criminal history information in hiring decisions, and implementing recommendations made by the consultant by 180 days from the entry of the Decree at the latest;
  • until the consultant’s recommendations are implemented, conducting internal individualized reviews for various misdemeanor crimes, using factors specified in the Decree; and
  • updating its reconsideration process for individuals whose conditional offer is rescinded because of criminal conviction history.

The retailer further agreed to submit detailed yearly reports to the EEOC, beginning the year after it implements the consultant’s recommendations. The EEOC agreed not to use data from these reports to bring any charges or lawsuits against the retailer, and it agreed to destroy data from these reports upon expiration of the Decree. The company also agreed to conduct trainings on its background check processes and to update its policies. Additionally, it agreed to provide notices to conditional hires about its background check processes and that a criminal history is not an automatic bar to employment.

The terms of the class-wide settlement must still be approved by the federal court.

Overall, employers’ use of background checks, including criminal record screening policies, raises an array of complex legal issues and continues to garner attention from legislatures, the EEOC, and the plaintiffs’ bar. All employers, and particularly multi-state employers, should continue to be vigilant about compliance with all applicable laws, including the so-called ban-the-box laws and the federal Fair Credit Reporting Act (FCRA). The FCRA especially has become one of the mainstays of the plaintiffs’ class action bar.

9th Cir. Allows FCRA “Permissible Purpose” Action to Proceed Despite Plaintiff Not Know the Purpose for Which the Credit Report was Accessed
In Nayab v. Capital One Bank USA, No. 17-55944, 2019 U.S. App. LEXIS 32575, at *24-32 (9th Cir. Oct. 31, 2019), the Court of Appeals for the Ninth Circuit found that an FCRA Plaintiff met the Spokeo and Iqbal/Twombly standards for pleading a “Permissible Purpose” action under the FCRA.

Nayab has pleaded facts sufficient to give rise to a reasonable inference that Capital One obtained her credit report for an unauthorized purpose. Nayab pleaded that she did not have a credit relationship with Capital One of the kind specified in 15 U.S.C. § 1681b(a)(3)(A)-(F). Pl’s First Am. Compl. 11, 40, 47, 50. Nayab specifically pleaded that, [*25] “upon review of her Experian credit report, Plaintiff discovered that Defendant submitted numerous credit report inquiries to Experian.” Id., 18. Nayab then puts forward factual assertions which negative each permissible purpose for which Capital One could have obtained her credit report and for which Nayab could possibly have personal knowledge: (1) Plaintiff did not initiate any credit transaction with Defendant as provided in 15 U.S.C. § 1681b(a)(3)(A). (2) Plaintiff was not involved in any credit transaction with Defendant involving the extension of credit to, or review or collection of an account of, the consumer as provided in 15 U.S.C. § 1681b(a)(3)(A). (3) Plaintiff is not aware of any collection accounts, including any accounts that were purchased or acquired by Defendant that would permit Defendant to obtain Plaintiff’s credit report as provided in 15 U.S.C. § 1681b(a)(3)(A). (4) Plaintiff does not have any existing credit accounts that were subject to collection efforts by Defendant as provided in 15 U.S.C. § 1681b(a)(3)(A). (5) Plaintiff did not engage Defendant for any employment relationship as provided in 15 U.S.C. § 1681b(a)(3)(B). (6) Plaintiff did not engage Defendant for any insurance as provided in 15 U.S.C. § 1681b(a)(3)(C). (7) Plaintiff did not apply for a license or other benefit granted by a governmental instrumentality as provided in 15 U.S.C. § 1681b(a)(3)(D). (8) Plaintiff did not have an existing credit obligation that would permit Defendant to obtain her credit report as provided in 15 U.S.C. § 1681b(a)(3)(E). (9) Plaintiff did not conduct any business transaction nor incur any additional financial obligations to Defendant as provided in 15 U.S.C. § 1681b(a)(3)(F). (10) Defendant’s inquiry for Plaintiff’s consumer report information falls outside the scope of any permissible use or access included in 15 U.S.C. section 1681b. Id. 24-35. These are factual allegations that, when taken as true, rule out many of the potential authorized purposes for obtaining a credit report. Further, Nayab alleges that she discovered Capital One obtained her credit report only upon review of her Experian credit report. The implication is that she never received a firm offer of credit from Capital One. These allegations, together with Nayab’s allegation that Capital One, in fact, obtained her report, state a plausible claim for relief. These are not simply bare conclusions devoid of facts supporting them. The exceptions to the general prohibition in § 1681b(f) are not elements of Nayab’s prima facie case which she must negative to state a claim, rather they are affirmative defenses for which Capital One bears the burden. Van Patten, 847 F.3d at 1044; see Tourgeman, 900 F.3d at 1109. By alleging facts giving rise to a reasonable inference that Capital One obtained her credit report for a purpose not authorized by statute, Nayab has asserted a plausible claim for relief under the FCRA. In a footnote, the Court of Appeals noted that no one really knew why the customer’s consumer report was accessed.

11th Circuit Reinstates FCRA Suit, Addresses Definition of “False Pretenses”
On November 12, the U.S. Court of Appeals for the Eleventh Circuit issued an order reversing in part and affirming in part a district court’s dismissal of claims brought by a consumer who claimed a bank violated the Fair Credit Reporting Act (FCRA) and the FDCPA when it allegedly provided debt information using a “false name” to a credit reporting agency and requested the consumer’s credit report without a proper purpose. In 2016, the consumer filed a lawsuit asserting the bank (i) violated the FDCPA by using a name other than its true name in connection with the collection of debt; and (ii) violated the FCRA when it failed to investigate the accuracy of the information provide to the credit reporting agency and requested his credit report without a permissible purpose. The district court dismissed the complaint for failure to state a claim. On appeal, the 11th Circuit affirmed the dismissal of the FDCPA claim, concluding that, while the false-name exception stipulates that the FDCPA applies to a creditor that uses any name other than its own when collecting its own debts (which may indicate a third party was collecting or attempting to collect the debt), the exception does not apply in this instance because “even the least sophisticated consumer” would understand that the bank and the entity named in the consumer report were related. However, the appellate court held that the district court erred in dismissing the FCRA claims. According to the opinion, the consumer stated three plausible claims for relief, including that the bank failed to investigate the accuracy of the information it sent, as required when a dispute arises, and that it unlawfully obtained his credit report. The 11th Circuit noted that while it has never addressed the meaning of “false pretenses” under the FCRA, it now joins other courts in holding that “intentionally obtaining a credit report under the guise of a permissible purpose while intending to use the report for an impermissible purpose can constitute false pretenses.” Moreover, the appellate court noted that while the bank may have obtained the consumer’s credit report for proper purposes, or that it may have disclosed the true purpose to the credit reporting agency, “this fact question cannot be resolved on a motion to dismiss.”

Does it Violate Public Policy to Terminate a Drunk Employee?
The employee, a long-time production foreman, failed a blood alcohol test in February 2018. In response, and pursuant to a federal regulation, the nuclear plant suspended the employee’s access to the facility for fourteen days. Before the suspension ended, the plant terminated him. The employee sued. The employee argued, in pertinent part, that his termination violated an alleged Pennsylvania public policy to “allow[] employees with alcohol or drug-related issues to complete treatment for first offenses before being terminated.” The Court disagreed. It recognized that Pennsylvania law permits common law wrongful discharge claims when an alleged termination “violate[s] a clear mandate of Pennsylvania public policy.” But, the court held, such a clear mandate has been recognized only in three limited circumstances: (1) when an employer fires an employee for refusing to commit a crime; (2) when an employer fires an employee for complying with a statutorily imposed duty; and (3) when a statute prohibits discharge.

Contrary to the plaintiff’s argument, the Court concluded that no statute or regulation required employers to forgive “first offenses,” or offer treatment in lieu of termination. The Court further concluded that, although Pennsylvania offers state employees the opportunity to participate in substance abuse programs after a first offense, this program did not evidence any “public policy” that applied to private employers. Accordingly, under the employment “at will” doctrine, the Court found that the nuclear plant could freely terminate the employee for failing a sobriety test.

The Court’s decision is a reminder that, while the employment “at will” doctrine is under threat, it’s not dead yet. Providing substance abuse counseling and treatment to employees who violate drug and alcohol policies may be good personnel management. But, all other things equal, nothing in Pennsylvania prohibits employers from simply terminating offenders. That guidance, however, comes with a caveat: every employee has multiple protected characteristics (i.e., a sex, race, national origin, religion, etc.). If employers terminate some substance offenders, while referring others to treatment, plaintiffs’ attorneys may be able to assert discrimination claims based upon alleged disparate treatment. At the same time, some offenses may be worthy of termination, while others aren’t. An employer could draw a clear difference, for instance, between a forklift driver who comes to work at three times over the legal limit, and a secretary who tests positive for marijuana. But there are also many gray areas, which could raise factual questions in a discrimination case. To that end, employers who run drug testing programs should draft clear, written guidelines demarcating what kind of offenses they consider terminable, and what kind of offenses warrant treatment, or a lesser sanction.

Va. Ruling Offers Defense for Hyper-Technical FCRA Claims
On Sept. 23, 2019, the U.S. District Court for the Eastern District of Virginia dismissed with prejudice a putative class action against First Advantage Background Services Corp. based on alleged violations of the Fair Credit Reporting Act. The decision marks a clear distinction between consumer reporting agencies, or CRAs, and the users of their reports in the hiring context, where a CRA applied employer-provided hiring criteria to background screenings for prospective employees. It further presents another helpful application of the U.S. Supreme Court’s 2016 decision in Spokeo, Inc. v. Robins.

As background, in Frazier v. First Advantage Background Services, each of the named plaintiffs used FADV’s internet portal to complete an employment application process for a particular employer. FADV generated a background report on the applicants.

FADV also allegedly sent a score—such as eligible or ineligible for employment, based on the employer’s hiring criteria—to the employer along with a copy of the applicant’s report. The plaintiffs claimed FADV was acting as both a CRA and a user during this process and hence allegedly violated inter alia the FCRA’s technical requirements under Section 1681b.

The plaintiffs filed their original class action complaint against FADV on Jan. 13, 2017, and subsequently amended it twice. In their second amended complaint, the plaintiffs alleged that FADV violated Title 15 of U.S. Code Section 1681b(b)(3)(A) by failing to provide a copy of the consumer reports and FCRA summaries of rights to the plaintiffs before taking an adverse employment action—the adverse action being the application of the eligibility score to the report before providing it to the employer.

The plaintiffs also alleged that FADV violated Title 15 of U.S. Code Section 1681b(b)(1)(A) by furnishing consumer reports to the employer without obtaining the proper certification that the employer had adequately disclosed to the applicants that a consumer report may be obtained for employment purposes and obtained their written consent to do so. FADV moved to dismiss the second amended complaint.

Court’s Decision on FADV’s Motion to Dismiss
In a 42-page opinion, the court dismissed all claims against FADV with prejudice. With respect to the plaintiffs’ adverse action claim, the court assumed without deciding that the plaintiffs had standing to assert the claim because it clearly failed under the Rule 12(b)(6) standard. The court found that “the allegations in the Second Amended Complaint do not demonstrate that First Advantage acted beyond its role as a CRA when it marked Plaintiffs as ineligible,” and thus held that the plaintiffs failed to state a claim for a violation of Section 1681b(b)(3). Notably, the court found that because the employer had defined the eligibility criteria for FADV, the employer was ultimately responsible for the hiring determination. And under the FCRA, only “the person intending to take such adverse action” must provide the requisite notice to the applicant. According to the court, FADV could not form the requisite intent because it was not authorized to make an employment decision.

Because First Advantage simply evaluated Plaintiffs’ consumer credit information in light of the [employer’s] criteria, the ultimate user of the information, First Advantage’s actions, even as alleged, constitute nothing more than the actions of a CRA, as contemplated by the FCRA. The plaintiffs argued that FADV’s eligibility designation and the employer’s denial of employment, together, constituted the adverse action. The court was not persuaded by this approach. It was especially hesitant because a similar claim had previously been brought against the employer, thus raising a potential claim preclusion issue. The court thus held that FADV did not act as a user and, accordingly, the plaintiffs failed to state a claim for relief in dismissing the adverse action claim.

In a noteworthy footnote, the court also expressed concern regarding the “ambiguity and redundancy” that would result from an expansive reading of when an adverse action has occurred under the FCRA. The court focused on a prior court ruling that suggested a CRA’s compliance may depend on the extent to which a prospective employer performs additional decision-making beyond the eligibility designation.

The court emphasized that, under such an analysis, a CRA would lack certainty as to whether it had complied with the FCRA at the time that it provided the report to the prospective employer. Additionally, the court noted that such a broad reading would likely require multiple entities to issue pre-adverse action notices to prospective employees. This, according to the court, raised a reasonable question as to whether Congress intended such redundancies.

The court also dismissed the plaintiffs’ certification claim, but solely on standing grounds. FADV had argued that the plaintiffs lacked standing to pursue any of their claims because the plaintiffs alleged no injury in fact. The court agreed with respect to the plaintiffs’ certification claim.

Specifically, the court found that the plaintiffs lacked standing to assert this claim because, while FADV may not have obtained the requisite certification from the employer, the plaintiffs had nonetheless knowingly and actively consented to FADV’s actions by logging into FADV’s internet portal and providing personal information for the explicit purpose of providing a consumer report to the employer.

The plaintiffs’ actions, the court reasoned, amounted to the common law defense of consent, stating in pertinent part that the plaintiffs’ “affirmative consent to the background check on the First Advantage portal serves as a complete defense to any harm that Congress sought to protect.” Thus, “[because] Plaintiffs consented to this disclosure, they [had] not alleged a sufficient FCRA violation to confer standing.”

Looking Forward
While the FCRA specifically authorizes employers to obtain and use consumer reports from consumer reporting agencies for employment decisions, the statute imposes specific and surprisingly technical requirements on such use and disclosure. Given these technicalities, claims under Section 1681b continue to be ripe for litigation. Indeed, more than half of all FCRA class actions filed over the past seven years allege claims under Section 1681b.

The Frazier decision provides compelling grounds to argue against a plaintiff’s attempt to blur the lines between consumer reporting agencies and users under the FCRA. Central to the Frazier court’s determination regarding the adverse action claim was the CRA’s lack of the requisite intent to take an adverse action under the FCRA.

Additionally, the court’s recognition of the ambiguities and redundancies that would result from an expansive definition of an adverse action reflects concerns shared by background screeners pursuing compliance with the statute. Certainty of compliance and avoiding redundancies proved to be another influential factor in the court’s decision to refrain from adopting the expansive reading urged by plaintiffs.

With respect to the plaintiffs’ certification claim, the alleged facts laid out what appeared to be a potential technical violation of the FCRA. Specifically, they alleged that the CRA failed to certify that the prospective employer had made the proper disclosure and obtained the applicants’ consent prior to obtaining a background check.

However, the applicants’ act of logging into the CRA’s portal and consenting to a background check in connection with their application for employment was sufficient to demonstrate that no injury in fact had been alleged. Importantly, the court determined that the injury that Congress sought to prevent was nonetheless prevented by an alternative means. Frazier, therefore, serves as an additional authority for defendants to challenge plaintiffs’ standing to bring hyper-technical claims.

Judge OKs $3.6M Deal in FCRA Suit Over Background Checks

A Florida federal judge granted final approval Tuesday to a $3.6 million settlement between Global HR Research and a nationwide class of job applicants to resolve allegations the consumer reporting agency violated the Fair Credit Reporting Act by disclosing workers’ background check results to employers without proper authorization.

ClearStar Reported the Following Related Information in the January Screening Compliance Update

FCRA Class Action Survives Early Procedural Challenge
In the first quarter of 2019, in Sanders v. Global Radar Acquisition, plaintiffs filed a putative class action claiming that the Defendants failed “to obtain certification prior to furnishing a consumer report for employment purposes in violation of 15 U.S.C. § 1681b(b)(1)(A).” The Plaintiffs were employed by Naples Hotel Group, which was not a party to the action, but were terminated based on the contents of background checks provided by Global HR background checks provided by Global HR, a consumer reporting agency. The crux of the claim was not that the Defendant reported false information but rather that the Defendant lacked certifications from the Naples Hotel Group that were required by the FCRA before providing reports. The issue before the district court was whether the plaintiffs had Article III standing to sue.

By way of some background: When applying for a position at Naples Hotel Group, Plaintiffs were required to sign documents titled “Notice and Acknowledgment”, which purportedly authorized Naples Hotel Group to procure their consumer reports for employment purposes. Global HR supplied the “Notice and Acknowledgement” forms, which plaintiffs allege did not comply with the FCRA. The relevant statutory provisions are 15 U.S.C. § 1681b(b)(1)(A)(i)-(ii), (b)(2), and (b)(3). In the Amended Complaint, Plaintiffs allege they were terminated on October 5, 2016 based upon the consumer reports Global HR unlawfully furnished to Naples Hotel Group and were never provided with pre-adverse action notification required by the FCRA. They further allege that Global HR invaded their “right of privacy” by providing their confidential information without proper authorization. The Defendant moved to dismiss. Importantly, the question in the Sanders case isn’t whether the Plaintiffs had statutory standing to sue. Instead, the issue was whether under Spokeo the plaintiffs had Article III standing. Article III standing is a threshold requirement to bring a claim, which (like jurisdiction) must be addressed before the merits. To establish Article III standing, a plaintiff must establish injury in fact, causation, and redressability. For injury in fact, it’s not enough to allege a procedural violation. The plaintiff must actually have suffered harm. That harm must be caused by the Defendant’s conduct. It must be “fairly traceable” to the Defendant. Finally, the harm suffered must be capable of redress by a favorable decision.

The Sanders court found that the Plaintiffs’ harm wasn’t a mere technical violation of the statute but, rather, was precisely the type of harm the FCRA intends to protect against: the distribution of consumer reports without authorization. As to causation, the Court also found that, critically, that harm was “fairly traceable” to the Defendant’s conduct. Specifically, the injury flowed from the Defendant’s conduct. The Court denied the Defendant’s motion to dismiss and found that the Plaintiffs had Article III standing to sue.

Cited FCRA Violation
604. Permissible purposes of consumer reports [15 U.S.C. § 1681b] (b) Conditions for Furnishing and Using Consumer Reports for Employment Purposes.

  • Certification from user. A consumer reporting agency may furnish a consumer report for employment purposes only if
    • the person who obtains such report from the agency certifies to the agency that
      • the person has complied with paragraph (2) with respect to the consumer report (Disclosure to Consumer), and the person will comply with paragraph (3) with respect to the consumer report if paragraph (3) becomes applicable (Conditions on use for Adverse Action); and
      • information from the consumer report will not be used in violation of any applicable Federal or State equal employment opportunity law or regulation; and
    • the consumer reporting agency provides with the report, or has previously provided, a summary of the consumer’s rights under this title, as prescribed by the Federal Trade Commission under section 609(c)(3) [§ 1681g].
  • Disclosure to Consumer.
    • In general. Except as provided in subparagraph (B), a person may not procure a consumer report, or cause a consumer report to be procured, for employment purposes with respect to any consumer, unless—
      • a clear and conspicuous disclosure has been made in writing to the consumer at any time before the report is procured or caused to be procured, in a document that consists solely of the disclosure, that a consumer report may be obtained for employment purposes; and
      • the consumer has authorized in writing (which authorization may be made on the document referred to in clause (i)) the procurement of the report by that person.
  • Conditions on use for adverse actions.
    • In general. Except as provided in subparagraph (B), in using a consumer report for employment purposes, before taking any adverse action based in whole or in part on the report, the person intending to take such adverse action shall provide to the consumer to whom the report relates—
      • A copy of the report; and
      • A description in writing of the rights of the consumer under this title

Court Decertifies 6.5 Million Member Class in Background Check Suit
A California federal court decertified a class of millions of Walmart employees after concluding that the named plaintiffs lacked Article III standing to bring their challenge to the employer’s use of background checks. Each of the three named plaintiffs applied for a job at Walmart, and each was subsequently hired after a credit and background report was conducted. They later filed a putative class action alleging that the employer ran afoul of the Fair Credit Reporting Act (FCRA) as well as California’s Investigative Consumer Reporting Agency Act (ICRAA) by willfully including extraneous information in the disclosure forms and inadequately informing them of their rights. Last January, U.S. District Judge David O. Carter certified a class of approximately 6,547,400 individuals who applied for a job at Walmart between June 2012 and March 2019. Walmart responded with a motion to decertify, arguing that the named plaintiffs lacked standing. Judge Carter agreed, granting the motion. Even assuming that Walmart’s written disclosures were inadequate under the FCRA, the plaintiffs failed to identify an injury stemming from the statutory violation that could suffice to support Article III standing, the court said. Pursuant to the U.S. Supreme Court’s Spokeo v. Robins decision, a statutory violation must also be accompanied by a “concrete injury”—either a de facto, actually existing injury or “the risk of real harm”—to establish standing. But the named plaintiffs alleged only a “bare procedural violation,” the court said. All of them testified in their depositions that they understood that Walmart might conduct a background check and none of them objected. In fact, two of the plaintiffs welcomed the check, the court noted, because they wanted to be hired. “[T]he only injury plaintiffs identify is that, as a result of defendant’s deficient disclosure forms, they ‘have been injured including, but not limited to, having their privacy and statutory rights invaded in violation of the FCRA,’ or, put differently, that defendant ‘obtained plaintiffs’ personal information in violation of their statutorily protected rights,’” the court wrote. “If, as the Supreme Court has established, there is a category of ‘bare procedural violation,’ then it must certainly encompass the wrongdoing alleged in plaintiffs’ first cause of action.” Case law from other California federal courts backed this conclusion, Judge Carter added, citing decisions holding that when job applicants have not claimed that the disclosure forms impaired their understanding or that they would not have authorized the background check had the disclosure form complied with the FCRA, they were unable to establish standing. The court distinguished the U.S. Court of Appeals, Ninth Circuit’s decision in Syed v. M-I, LLC, where the FCRA plaintiff learned after the fact that he had been subjected to a background check. “Named plaintiffs, however, understood that defendant might run a background check, and because they wanted defendant to hire them, they consented to the potential background checks,” the court said. The “named plaintiffs have not adduced any evidence that their substantive rights were violated.” As the plaintiffs’ claims under the ICRAA mirrored the FCRA claims, they similarly failed for lack of standing. Judge Carter decertified the class and remanded the case to state court. To read the order in Pitre v. Wal-Mart Stores, Inc., click here.

First Day on the Job and on Notice: When the Statute of Limitations Begins for Employer Background Checks
Employers began to rethink how they obtain authorization and retrieve background and credit checks for new employees after the Ninth Circuit’s decision in Gilberg v. California Check Cashing Stores, LLC, 913 F.3d 1169, 1177 (9th Cir. 2019), as we’ve previously discussed. However, lower California courts recently decided other issues surrounding background checks, such as the amount of time employees have to file a claim. These recent rulings suggest that the statute of limitations for an employee to file a claim for an alleged violation of federal and/or state background and credit checks laws can begin on the employee’s first day of work.

Plaintiffs Have Two Years to File a Background Check Claim
Background check disclosure and authorization forms are required by the Fair Credit Reporting Act (“FCRA”), California’s Consumer Credit Reporting Agencies Act (“CCRAA”) and Investigative Consumer Reporting Agencies Act (“ICRAA”). Each has a two-year statute of limitations. 15 U.S.C. 1681p (earlier of two years from date of discovery or five years from date of the violation); Cal. Civ. Code § 1785.33 (two years from discovery but not more than seven years unless a defendant willfully violated the code); Cal. Civ. Code § 1786.52 (two years from date of discovery). For the two-year limit to apply, employers carry the burden to show that a “reasonably diligent plaintiff would have discovered the facts constituting the violation.” Drew v. Equifax Information Services, LLC, 690 F.3d 1100, 1110 (9th Cir. 2012). Yet, proving when a plaintiff discovered that their potential employer retrieved a background check on them can be problematic.

Courts Decide That Plaintiffs Can Be on Constructive Notice from Their First Day of Work
Recent California cases deemed that plaintiffs discovered facts constituting their background check as early as their first day of work.[1] In Berrellez v. Pontoon Solutions, Inc., 2016 U.S. Dist. LEXIS 142174 at *18 (C.D. Cal. Oct 13, 2016), an employee was on constructive notice that his new employer pulled a background check on him because, in addition to having his fingerprints taken, he signed consent forms stating he was aware a background check would be performed. At the latest, the employee was on notice on his first day of work, so his claims were barred by the statute of limitations. Thus, the employer’s motion for summary judgment was granted. Additionally, the court in Ruiz v. Shamrock Foods Company, 2018 U.S. Dist. LEXIS 148929 at *16 n.6 (C.D. Cal. Aug. 22, 2018), dedicated a lengthy footnote to this issue. Two employees received job offers contingent on receiving satisfactory background checks. Thus, they knew on their first day of work that their employer retrieved background checks on them, because they started work. Although the court decided the case on other grounds, the two employees’ claims would have failed because of the two-year statute of limitations. Id.

Finally, a reported case from the Northern District of California held that an employee can be on notice from his or her first day of work. In Rodriguez v. U.S. Healthworks, Inc., 388 F.Supp.3d 1095, 1104 (N.D. Cal. 2019), an employee was on constructive notice that her employer retrieved a background check on her because her job offer was contingent on a satisfactory result. Thus, the statute of limitations began to run on the employee’s first day of work, similarly to Ruiz. Since the employee started work four years prior to filing the lawsuit, her claim was barred by the two-year statute of limitations. The court granted the employer’s motion for summary judgment.

If an employee’s position is contingent on a satisfactory background check, the employee is likely aware of any alleged FCRA, CCRAA or ICRAA violations starting with his or her first day of work and would have two years from that day to file a claim.


International Developments

Employee Data Protection in Canada

i-Requirements for Registration
Canadian law provides for both private-sector and public-sector privacy legislation. Depending on the jurisdiction in which they operate, private-sector employers in Canada are subject to either federal or provincial legislation governing the collection, use and disclosure of personal information.

The federal Personal Information Protection and Electronic Documents Act (PIPEDA) applies to federally regulated employers, as well as employers that are provincially regulated that operate in provinces that have not adopted substantially similar privacy legislation. To date, Quebec, Alberta and British Columbia have enacted personal information legislation, which has been recognized as substantially similar to PIPEDA. In 2013, Manitoba passed private-sector privacy legislation that is not yet in force. It has not yet been determined whether this legislation is substantially similar to PIPEDA.

In addition to PIPEDA and provincial legislation dealing specifically with the collection, use and disclosure of personal information in the private sector, employers may have additional statutory privacy obligations. For example, several provinces have enacted legislation, such as the British Columbia Privacy Act, which makes it an actionable wrong for one person, willfully and without claim of right, to violate another’s privacy. In Quebec, the CCQ and the Quebec Charter of Human Rights and Freedoms provide for additional privacy obligations.

ii-Cross-Border Data Transfers
Canadian privacy legislation addresses the notion of cross-border data transfers. In this regard, the transfer of personal information outside Canada must be disclosed in an employer’s privacy policy, to meet the openness and safeguarding principles that apply to PIPEDA and similar privacy legislation. Further, employees whose personal information is collected must be informed of the transfer to any foreign entities and must be provided with appropriate contact information for obtaining details on the privacy obligations of those entities. While this has been held to exist as an implicit requirement in privacy legislation across Canada, it is made explicit in Alberta’s Personal Information Protection Act, which also differs from other Canadian privacy law in that it imposes specific breach notification obligations on organizations.

iii-Sensitive Data
Under all Canadian privacy legislation, personal information is broadly defined as ‘information about an identifiable individual’, with certain exclusions. Sensitive information that would generally fall under the ambit of ‘personal information’ in Canadian privacy legislation would include, in particular, financial information, medical information, educational history, union membership or information relating to an employee’s family background.

iv-Background Checks
The validity of background checks varies greatly across Canadian jurisdictions. Generally, employers may perform a background check on prospective employees; however, certain jurisdictions limit criminal or credit checks. Human rights legislation and privacy legislation across the jurisdictions will limit the use of criminal or credit background check results, even if these types of background checks are permitted. Employee consent to background checks is almost always preferred, if not required in most Canadian jurisdictions.

Employee Data Protection in Mexico

i-Requirements for Registration
On 5 July 2010, the federal government published in the Federal Official Gazette the Federal Law for Personal Data Protection Possessed by Private Persons (DPL), which has been in force since 6 July 2010 and is intended to protect personal data held by private persons—either companies or individuals—in order to regulate the lawful, informed and controlled treatment of the data, with the objective of ensuring the right to privacy as well as the right of informational self-determination of persons. The DPL protects personal data that is subject to process, use or transfer, at a national and international level. To clarify the content of the DPL, on 21 December 2011, the Ministry of the Economy published in the Federal Official Gazette the Regulations of the DPL (the Regulations), which have been mandatory since 22 December 2011. The Regulations provide in detail the conditions for the compliance and enforcement of the DPL to bring legal certainty to its regulated subjects. Both regulatory instruments have a direct impact on employees, either by strengthening their right to privacy in relation to their employer and its subcontractors or to establish duties they must comply with in order to preserve the privacy of the personal data that is processed in the course of their activities. In terms of the DPL and its Regulations, there is no obligation to register the company—in its role of data controller—with the Mexican data protection agency (the National Institute of Transparency, Access to Information and Protection of Personal Data (INAI)) or any other government body. However, diverse obligations should be fulfilled in order to comply with the provisions of the DPL and its Regulations.

The Regulations compel employers to create an inventory of processed personal data to identify its nature—as sensitive, financial or economic personal data requires the written express consent of the data subject to be collected and processed and should be protected by stronger measures than ‘ordinary’ personal data. In addition, the inventory may determine the form of the processed data (i.e., whether it is expressed or contained in a digital format, in printed form, or in visual or audio format).

For the collection and processing of personal data, the general rule is that the data subject must be informed by means of a privacy notice about the collected data, the purposes for the processing and the data transfers, and the means to exercise the right to access, rectify, cancel and oppose the data processing, as well as the means to express his or her consent to authorize the data processing and transfers. However, the data subject’s consent is not required for the processing of personal data to be lawful if it is necessary to comply with obligations derived from a legal relationship, such as a labor contract, entered into by the data subject (employee) and the data controller (employer). Candidates for employment do not fall within this exception as they do not have any legal relationship with the employer, so their consent is required to transfer their personal data to a third party. The Regulations compel companies to limit access to personal data only to authorized employees owing to their position or functions. The DPL also provides that companies must implement and maintain administrative, technical and physical security measures to protect personal data against damage, loss, alteration, destruction, use, access or unauthorized use (Article 19 of the DPL and Chapter III of the Regulations). Under Article 48 of the Regulations, the employer is compelled to implement a range of actions to ensure that their employees comply with the DPL and its Regulations such as:

  1. developing binding and enforceable privacy policies and programs within the organization;
  2. implementing a training and staff awareness program on the obligations regarding personal data protection, including any modifications that are made;
  3. establishing an internal system for supervision and monitoring, verification or external audits to test compliance with privacy policies;
  4. allocating resources for the implementation of privacy programs and policies;
  5. providing mechanisms for the enforcement of privacy policies and programs, as well as for sanctioning lack of compliance;
  6. establishing measures for tracking personal data during its processing;
  7. establishing procedures to receive and respond to doubts and complaints from the personal data holder;
  8. establishing measures for the assurance of personal data, in other words a set of technical and administrative actions that guarantee the responsible party’s compliance with the principles and obligations set forth by the DPL and its Regulations; and
  9. establishing measures for the traceability of personal data, that is, actions, measures and technical procedures that allow for the tracking of personal data while it is being processed.

Privacy regulations should be related to a company’s internal labor regulations in order to enforce sanctions for infringement.

ii-Cross-Border Data Transfers
In terms of the DPL and its Regulations, companies are not compelled to register their data transfers at the INAI or at any other government agency and, as a general rule, data transfers are subject to the consent of the data subjects (generally granted through the privacy notice). However, the DPL provides for a few exceptions in which the employee’s consent is not required for the data transfer:

  1. the transfer is necessary for preventive treatment or medical diagnosis, the delivery of healthcare, medical treatment or the management of health services;
  2. the transfer is to companies under the same corporate control (subsidiaries and affiliates under the common control of the data controller), or to a parent company or an associated company that operates under the same processes and internal policies;
  3. the transfer is necessary under a contract that has been concluded, or a contract to be concluded, in the interest of the employee by the employer and a third party; or
  4. the transfer is necessary for the maintenance or fulfilment of a legal relationship between the company and the employee (Article 37 of the DPL).

Neither the DPL nor the Regulations require safe harbor registration for data transfers or for carrying out an onward transfer.

iii-Sensitive Data
In terms of the DPL, sensitive data is defined as data that pertains to the data subject’s most intimate sphere, or data that, if misused, could lead to discrimination or cause a serious risk to the data subject. In particular, personal data is considered to be sensitive if it relates to racial or ethnic origin, current or future health status, genetic information, religious, philosophical and moral beliefs, union membership, political opinions, and sexual preference (Article 3, Section VI of the DPL). Financial and economic data is not included within the category of sensitive data; however, the processing of this data requires the express consent of the data subject, except as provided by law (Article 8, Section IV of the DPL). The requirement for consent for the collection of sensitive data is more stringent than in the case of non-sensitive data. When sensitive personal data is collected, the privacy notice must address explicitly that it deals with this type of data (Article 16 of the DPL). No databases that contain sensitive data should be created without justifying their creation for legitimate purposes, concrete and consistent actions, or explicit purposes pursued by the regulated subject (Article 9 of the DPL). If infringements to the DPL are committed in the processing of sensitive data, the penalties can be increased to twice the established amounts (Article 64, Section IV of the DPL).

iv-Background checks
Under the DPL and its Regulations, background checks, credit checks and criminal record checks are allowed if the candidate for employment has granted his or her express consent, as such records include sensitive data. Employers must be aware of processing personal data under the principles of lawfulness, consent, information, loyalty, proportionality, confidentiality and accountability, and must be aware of processing the candidate’s or employee’s personal data or information on a non-discriminatory basis.

Why Special Category Personal Data Needs to be Handled More Carefully
The General Data Protection Regulation (GDPR) recognizes that some types of personal data are very sensitive and states that data controllers must give it extra protection. This is known as special category data. Special category data is information concerning a person’s:

  • health;
  • sex life or their sexual orientation;
  • racial or ethnic origin;
  • political opinions;
  • religious or philosophical beliefs; or
  • membership to a trade union.

Special category data under the GDPR is broadly similar to sensitive personal data under the Data Protection Act 1998. However, special category data also relates to genetic and biometric identification data.

Special category data is the most sensitive personal data a controller can process. The misuse of this data is likely to interfere with an individual’s fundamental rights and freedoms and could cause real harm and damage. Due to the possible risks, the ICO expects controllers to take all necessary precautions to protect this data.

What does our new guidance say about how organizations should approach processing special category data?
Firstly, as always, you must have a GDPR lawful basis to process data under Article 6. However, when processing special category data you also need an Article 9 condition for processing and potentially an associated DPA 2018 Schedule 1 condition. Many of the DPA 2018 conditions require you to have an appropriate policy document in place. This is a short document that should outline your compliance measures and retention policies with respect to the data you are processing. We have a template appropriate policy document in our guidance to help organizations ( There is more to do when processing special category data, but the provisions are in place to help you protect the data of those whose information you hold and increase their confidence in you. It’s worth taking the time to get it right.

Guidelines 3/2018 on the territorial scope of the GDPR (Article 3) – Version Adopted After Public Consultation
The document can be retrieved and downloaded at:


Other Developments

Marijuana Breathalyzers: Could New Testing Methods Help Employers and Employees?

Employers are grappling with the wave of marijuana laws sweeping the nation, some of which provide very employee-friendly protections. While no state requires an employer to tolerate employees’ use of marijuana or impairment while they are working, present drug testing methodologies cannot determine whether an employee used marijuana two hours or two weeks ago. That might be changing as companies reportedly are closer to developing technology that will be able to detect recent use, a welcome development for both employers and employees.

Marijuana causes impairment to people who ingest it. Actually, the psychoactive component of marijuana, THC (tetrahydrocannabinol), is what really causes impairment. It weakens judgment and motor function. If an employee goes to work high, that creates serious safety concerns. It also creates legitimate concerns regarding employee judgement, behavior, work product, and efficiency. Science has confirmed that these concerns stemming from marijuana use are legitimate.

Another problem is that marijuana use is illegal under long-standing federal law, the Controlled Substances Act. To be clear, it is still illegal to use, possess, or distribute marijuana. Many employers take issue with the idea of being required to tolerate their employees’ conduct that is plainly criminal. Understandably, employers may not like the message that condoning marijuana use sends to their clients, target markets, and communities.

Opinions as to whether marijuana should be legal vary. But most would agree that no employer should have to tolerate employees working while high from use of marijuana—whether the use is legal or illegal. This idea is similar to the generally accepted idea that employers need not tolerate employees working while intoxicated from alcohol consumption, which is legal. Indeed, a number of state marijuana laws include provisions reflecting that employers need not accommodate or tolerate marijuana use or impairment in the workplace or while working. This is the point at which perhaps the most practical problem lies for employers and employees. How can an employer know if an employee is impaired or high from ingestion of THC? An employer with “reasonable suspicion” that an employee is working while intoxicated from alcohol can rely on science to establish impairment. Blood alcohol tests have generally been accepted to measure impairment from alcohol consumption. Unfortunately, there has been no scientifically accepted drug test to show impairment from marijuana use. While most tests show the presence of THC in a person’s system, reflecting use in recent days or weeks before the test, they do not show impairment at or near the time of the test.

New and Improved Testing Methods Could be a Solution
Science may be catching up with the times. A number of media outlets have reported that certain companies are developing tests that use breathalyzers to evaluate how recently a person used marijuana. According to reports, these tests are being designed to show if a person used marijuana within the 2-3 hours before the test, which has been reported to be within the peak period of impairment after ingestion of THC. It is unclear if and when these devices will be available for employment-related testing or the costs associated with such tests. That said, if new marijuana testing devices and methodologies become generally available, and they are validated as a reliable means by which to determine impairment or recent marijuana use, employers may have a much-needed solution to their legal and practical dilemmas. In fact, these marijuana tests could bring employees and applicants peace of mind too. An employee who uses marijuana at home on Sunday evening, in accordance with his doctor’s instructions, may be able to rest easy knowing that, if sent by his employer for a drug test on Monday, the test results will show that he was not impaired while working.

The near-term development and reliability of these testing devices is currently unknown and employers should not expect them to be a panacea to their marijuana woes. Amongst other issues, the devices may not be permitted by state law. Where their use is permissible, we predict their validity and reliability will be challenged by experts and their widespread use by certified laboratories for workplace drug testing programs is not likely to occur any time soon.

Advice to Employers: Evaluate Whether Outright Bans on Marijuana Are Outdated
As more states legalize medical marijuana, employers should evaluate employment policies that outright ban the use of marijuana. Currently, 33 states have passed laws approving the use of medical marijuana. Within Phelps Dunbar’s geographic footprint, the states of Louisiana, Florida, Texas, and North Carolina have adopted medical marijuana programs. For now, all marijuana usage, including for medical purposes, remains illegal in both Mississippi and Alabama. However, employers in these states should not sit idle because medical marijuana might be legal in both states soon. In 2020, the state of Mississippi will be voting on the legalization of medical marijuana via ballot Initiative Measure No. 63. In Alabama, the state legislature set up the Alabama Medical Cannabis Commission which has been charged with examining the laws and regulations of the federal government and other states regarding medical marijuana and considering the potential impacts of legalization. The commission is supposed to report its finding to the Alabama legislature by Dec. 1. Based on national trends, medical marijuana might be legalized in both Mississippi and Alabama sooner rather than later.

Under federal law, marijuana remains an illegal Schedule I drug under the Controlled Substances Act. As a result, employment policies that prohibit the use of marijuana both at home and in the workplace do not run afoul of federal law. Furthermore, courts have found that the Americans with Disabilities Act (ADA) does not protect individuals who use marijuana for medical purposes because marijuana is illegal federally. Thus, under federal law, an employer may make hiring or firing decisions based on an individual’s marijuana usage.

Unlike federal law, some states have specifically passed laws prohibiting discrimination against employees who legally use medical marijuana, and some state courts have found that medical marijuana users are entitled to protection. In 2017, Massachusetts courts found that an employer owed its employee an obligation to participate in the interactive process before it terminated her for medical marijuana usage. However, Florida’s medical marijuana law specifies that it does not limit the ability of an employer to establish, continue or enforce a drug-free workplace program or policy, and that employers are not required to accommodate the medical use of marijuana in any workplace or any employee working while under the influence of marijuana. Florida law further provides that the state’s medical marijuana law does not create a cause of action against an employer for wrongful discharge or termination. The laws in Louisiana, Texas and North Carolina are silent on medical marijuana’s impact on employer-employee relations.

Due to the uncertain state of the law, employers should consider whether an outright ban on marijuana in their policies might be modified to account for the changes. One potential option is to treat medical marijuana like any other prescription medication and to alter policies that provide a blanket prohibition on marijuana use. Such changes would need to account for the state laws in the states where the employer operates, and consider whether the employer wants to test for marijuana, and how it may want to handle positive tests for marijuana, which could differ based on what type of job is at issue (e.g., federal contractors and transportation workers subject to DOTD regulations).

The law on allowance of medical and even recreational use of marijuana is continuing to evolve, and some employers have been challenged in court when relying on their policies that were compliant in the past. Employers seeking to stay ahead of the trend should take a look at their policies and consider whether an update is necessary and consult with legal counsel before implementing such changes.

Will AI replace the Human Recruiter?
So far, people analytics has only supported recruiters in assessing and pre-selecting applicants. We may soon be a step ahead. Will algorithms completely replace the human resources managers in hiring decisions in the near future? According to a recent Washington Post article, a new artificial intelligence hiring system, called HireVue, is gaining ground with many employers in the US in particular. Candidates conduct their interview through the camera of their computer or mobile phone. The AI system analyses their facial movements, eye contact, word choice and speaking voice before ranking them against other candidates. According to the Washington Post, more than 100 companies now use the system and more than a million job seekers have been analyzed. On the other hand, universities offer courses for students to prepare for the HireVue interview.

As in Europe, the use of algorithms and AI for hiring decisions in the US also raises eyebrows. While some say that people analytics tools are not sufficiently rooted in scientific fact and open the door to discrimination, others argue that computers are still more objective than human recruiters who suffer from conscious and biased prejudice. In particular in Europe it is often criticized that people analytics interferes with employees’ privacy rights. Others criticize that the unsuccessful candidate will not be informed of what he or she has done wrong in the opinion of the algorithm—but is that really a difference from an interview with a human recruiter?

According to the Washington Post, HR managers in the US think that in the future at least some employers may rely exclusively on machines and algorithms for recruitment decisions in the future. Would that also be the case in Europe? Normally not. According to Article 22 (1) of the GDPR, candidates have the right not to be subject to a decision based solely on automated processing if this decision produces legal effects for him or her or that similarly significantly affects him or her. While Article 22 (2) GDPR provides for some limited exceptions, in most cases this will mean that the final decision will have to be taken by a human recruiter. The following rules apply to this final decision:

  • the HR manager is empowered to make decisions,
  • the HR manager has a sufficient data basis to make decisions,
  • the HR manager has sufficient professional qualification to make decisions,
  • the HR manager has room for maneuver to deviate from the automated pre-selection process,
  • the HR manager intervenes at the right time, i.e. before the final decision is made,
  • the HR manager does not limit himself to a random check only, or to filtering out implausible results.

Furthermore, this “human intervention” must be well documented. Otherwise, an employer who uses AI to prepare a hiring decision will not be able to prove that he has acted in accordance with GDPR, and that the final decision has been made by a human being.

HireVue said its system dissects the tiniest details of candidates’ responses—their facial expressions, their eye contact and perceived “enthusiasm”—and compiles reports companies can use in deciding whom to hire or disregard.

The ADA Does Not Cover the Possibility of Future Disabilities
The Seventh Circuit Court of Appeals recently ruled that the American with Disabilities Act (“ADA”) does not protect an applicant who later may become impaired. In this instance, a worker applied for a position that would have required him to perform “safety-sensitive” tasks. After he was extended a conditional offer of employment, Plaintiff was required to pass a medical evaluation. Defendant, as a matter of course, does not hire applicants for safety-sensitive position if their body mass index (“BMI”) is over 40. Defendant reasoned that applicants who exceed BMI levels are at a substantially higher risk of developing certain conditions that can result in incapacitation on the job. Plaintiff’s BMI was 47.5. Plaintiff filed suit asserting that the failure to hire him amounted to discrimination under the ADA on the basis of a perceived disability. The employer denied the allegations, arguing that the worker did not have a disability because “obesity” was not a qualifying impairment and, moreover, there is no evidence to suggest that he was regarded as being presently impaired. The District Court found Plaintiff’s allegations of “perceived disability” to be worthy of a trial, but the Seventh Circuit reversed, concluding that the employer did not perceive there was a current perception had an obesity-related impairment at the time of withdrawal of the offer. This decision adds to the growing body of ADA related case-law and may add to the confusion as to when a perceived disability is protected. Interesting, the Genetic Information Nondiscrimination Act (“GINA”) is not discussed in the Court’s decision as BMI likely does not qualify as genetic information. However, employers should be aware of GINA in all employment decisions.

Salary History Ban Compliance and Your Business

Employers everywhere need to take heed of salary history bans as policymakers push efforts to regulate discriminatory hiring practices in every state.


As the U.S. continues on the fast track toward workplace equality, 2019 may soon be remembered as the year of the salary history ban. Though the legislation is not yet in place in every jurisdiction, employers everywhere need to take heed of these laws as policymakers push efforts to regulate discriminatory hiring practices in every state.


How Do You Know if a Salary History Ban Affects Your Business?


Bans are currently in place for 17 states and 19 localities. Some of these laws ban employers from discriminating against hiring applicants who refuse to provide salary histories. Some laws ban employers from asking for salary history altogether. And other laws ban employers from providing salary history if asked.


There is a running list of salary history laws available online, but the variations in their requirements­—and the pace at which they are being implemented in new jurisdictions—makes this question an important one that needs to be actively monitored by your legal and/or human resources departments. Any changes affecting your business also need to be communicated quickly and clearly to everyone involved in your hiring processes.


What if the Salary History Ban isn’t in Effect in My Location?


In a post for Forbes, Aram Lulla, General Manager of Human Resources Practice at Lucas Group and member of the Forbes Human Resources Council, stresses the benefits of compliance with salary history bans regardless of whether or not a law is already in place for a particular hiring manager’s location of the business.


“Employers who lead the charge gain a critical first-mover advantage, benefitting from transparent salary negotiations,” Lulla says. “This is a huge employer brand boost that helps to make your business an employer of choice.”


“You do not need to benchmark the pay against what a candidate previously made,” he continues. “What would you pay someone who has the desired skills, experience, and education, and also aligns with your company culture and fits with your team? What does your current budget allow for this position? What is the current market rate for similar positions at your competitors? Is your expected salary range in line with what the market demands? What other components will be part of the total compensation package? These questions can help you set expectations and zero in on an appropriate salary range.”


Additionally, a salary history ban may not be in place in the jurisdiction over an employer’s headquarters, but there could be one in place for a branch location or in the place of residence for a potential employee who will be working remotely.


Now that You’ve Decided to Hire for Skills Over Savings…


Ask ClearStar to assist with the candidate background screen so you can be assured your new hire is worth every penny and the very best choice for your business.

Mina Chang: Proving the Value of an Experienced Background Screening Company

How does a 35-year-old formerly aspiring K-Pop recording artist end up in a White House role that requires a top security clearance?

For Mina Chang, all it took was exaggeration and falsification of details on her resume, leveraging her social media presence, and a fake Time Magazine cover­ featuring­, you guessed it, her!

Now, just 10 years after releasing The Holiday Album (a U.S. version of Waiting for You (K-Pop Album)), Chang is earning a six-figure salary as deputy assistant secretary for the Bureau of Conflict and Stability Operations. The goals of the executives who serve in this particular Department of State include three key lines of effort: assessment of political instability, security sector stabilization, and countering violent extremism in geographic regions of national interest.

Creative and Highly Qualified or Creative with Exaggerations and Lies?

Chang’s April 2019 appointment to the State Department seems to go beyond a hopeful hiring manager’s bet on an unproven job applicant with unique talents and, perhaps, undeveloped abilities for the task at hand. At press time, it remains unknown why exactly Chang was nominated and who provided the nomination for her State Department position. We do know her resume reads like that of an experienced philanthropist and diplomat rather than a pop vocalist and it took journalists at NBC News to break the truth behind Chang’s work experience.

According to Chang’s own bio on the Department of State website, she “is an alumna of the Harvard Business School [and] a graduate of the United States Army War College National Security Seminar.” In reality, Chang is an alumna of Harvard Business School. She took a seven-week long course there in 2016. As for her claim to be a “graduate” of the Army War College? That was a four-day long seminar.

Those are just two misleading tidbits of information in an extensive paragraph about Chang’s education, training, and expertise in her area of service. Claims about the accomplishments of her nonprofit called Linking the World are also now in question, as is the reason behind the fake Time Magazine cover she shared in a 2017 interview with “Global Outlook,” an educational access channel television program produced by Houston Community College.

Technology Makes It Easy to Promote Fake News

To the untrained eye, Chang seems pretty legit. Her social media accounts include photo ops with political leaders and celebrities. She makes appearances at expensive charity events and appears to be involved with big humanitarian efforts. Snapshots of her Time cover are all over the internet and her LinkedIn page sports the names of important organizations most of us regular people just don’t know much about–including how to confirm their validity of her relationships to them.

Those who understand how to use the digital tools available to us can easily manufacture images and impressive backstories and then wallpaper the internet with “proof” that they are real. But being good at personal PR isn’t the same as being good enough to fulfill a government office or do important work for your business.

ClearStar has the tools to investigate all kinds of claims your potential employees may make about themselves. Let’s do the work of ensuring your new hires are the best applicants and not the best-looking applicants.

Protecting Your Brand: Start with the Background Screening Process for Potential Hires

Screening and employer branding. How do these two elements work together?

Screening is the process of performing background checks on potential employees.

Employer branding is the market perception of what it’s like to work for an organization— the image that people have of your company. Both are extremely important pieces of your company’s puzzle.

Protecting and boosting your brand

A great brand helps capture the attention of great new hires. So, how do you protect your brand? Here are a few simple ways.

Hire a strong team. Focus on hiring a team of trusted employees who can help you build that brand. In today’s competitive job market, finding the right hires can be a challenge. But screening can help, especially when coupled with cutting-edge hiring solutions.

Don’t focus on compensation. A competitive salary adds considerable weight to any position, but the pay is not necessarily a potential employee’s first consideration when job hunting. Examples of main considerations include company values, company location, management style, work-life balance, and job security.

Write unique job descriptions. If done well, this can provide a feel for the personality of management and the atmosphere of the company as a whole.

Benefits of screening and employer branding

Good branding attracts good applicants. Screening helps you confirm your best hiring instincts. It makes your shortlist even shorter.

Since you know that there are certain types of people you don’t want to hire (for example unmotivated, incommunicative, violent, or unfaithful people), it should be made clear that for those with such unfavorable traits, your company would not be a good fit. Good branding helps to set expectations and make it easier to hire and retain only employees who are worth your company’s time and money.

There are many ways to convey to potential hires the personality of your company, and at ClearStar we know that attracting the right candidates is one of the best things you can do for any business. Contact us today to find the best screening package for you to protect and best run your company!

The 5 W’s, 1 H, and a Few C’s on the FMCSA Clearinghouse for Employers

Hello! Todd Shoulberg, President of Medical Information Services (MIS) at ClearStar, here to bring you the next installment of For The Public Record—a blog that features thought leadership from the most seasoned experts at ClearStar, across all functions of the background screening process.

There has been much hype around the fact that a rule passed back in 2016 is finally coming into effect next year. Of course, I’m talking about the Commercial Driver’s License Drug and Alcohol Clearinghouse (81 FR 87686).

Registration for this database just opened up last month for all employers and service agents. The query plans just went online this month for purchase. The full Clearinghouse is open for business at the beginning of January 2020.

Feeling behind? Here are the important facts to get employers up to speed:


U.S. Department of Transportation (DOT)
Federal Motor Carrier Safety Administration (FMCSA)
Drug & Alcohol Clearinghouse (Clearinghouse)


The Clearinghouse is a secure online database that will give employers, the FMCSA, State Driver Licensing Agencies (SDLAs), and State law enforcement personnel real-time information about commercial driver’s license (CDL) and commercial learner’s permit (CLP) holders’ drug and alcohol program violations.

Employers must report alcohol test results with a concentration of .04 or greater, refusals to take an alcohol or drug test, as well as actual knowledge of a violation.

Employers will also need to report negative return-to-duty (RTD) test results and the successful completion of a driver’s follow-up testing plan.

Employers will be required to query the Clearinghouse for current and prospective employees’ drug and alcohol violations before permitting those employees to operate a Commercial Motor Vehicle (CMV) on public roads.

Employers will also be required to annually query the Clearinghouse for each driver they currently employ.



The Clearinghouse will enable employers to identify drivers who commit a drug and alcohol program violation while working for one employer, but who fail to subsequently inform another employer (as required by current regulations).


January 6th, 2020


Employers who have DOT/FMCSA employees will need to register and pre-purchase query plans. These query plans are $1.25 per search or $24,500 for unlimited searches for one year. Employers will have to query all new hires and all current drivers on a yearly basis. These searches are in addition to the current required checks under 49 CFR Part 40 Section 40.25. After January 6th, 2023, employers only have to query the Clearinghouse to satisfy these requirements.

The website listed above has tons of information and a pretty hefty FAQ section. This new service is being applauded in the industry but will have some hiccups at the start.


  • There is a lack of API or web services integration. All information must be entered directly on the FMCSA website and not via any other method.
  • Only end user employers may purchase queries. If an FMCSA company would like a service agent to run queries for them, the purchased codes must be given to the service agent (CRA/TPA) to be used.
  • If a driver does not pre-register for consent, it is done by U.S. Mail, which will add days or weeks to turnaround time.
  • No clear direction has been given on how best to use the CDL state and license number on the Custody and Control Form (CCF) as the only ID#, no longer using the SSN.

As a reminder, this only applies to the FMCSA mode under DOT. All other modes do not report to this database, and you do not need to query it. Here is a fact sheet that applies to Employers Only.

If you have any questions you are being encouraged to reach out via or you can email ClearStar’s MIS office at This is for the record.

Walmart VP of Talent on Hiring the Best People

Hiring the best people for your company starts with intentional choices made at every level from management to operations. Amy Goldfinger, Walmart’s senior vice president of talent acquisition, breaks down her methodology into six guidelines that can be applied by businesses of any size.

  1. Be Consistent

Company culture doesn’t have as much to do with hot-desking and weekly happy hours as much as the processes and values that drive every aspect of your business. From reception to the c-suite, every employee must understand what’s important throughout your company. When a corporate mission and all of the goals established to accomplish it are well-communicated and consistently managed, the content of your job ads, the behavior of your HR staff, and the efforts of your new hires will fall right in line toward reaching your business potential.

  1. Be Human

Brands are all about the stories they tell. But rather than taking what your marketing department has crafted for customer acquisition and shoehorning it into other purposes, have an actual story and share it. The consistency of your company culture mentioned above is a good place to start. Your people are your story and your story is your brand. Corporations may be considered “people” for some legal purposes, but they need to be human for recruiting purposes.

  1. Be Diverse

Diversity among your staff doesn’t happen without effort. Be intentional about this from the top down. When company leadership comes from diverse backgrounds, it sets a tone about who it finds valuable as customers and throughout its ranks.

  1. Get Real

As a very practical effort when learning about your candidates, inquire about past experiences rather than hypothetical situations. Have your candidates share their previous jobs or community involvement. Get specific to discover problem-solving abilities, stress management skills, and general personality traits.

  1. Seek Diversity

To follow up on Goldfinger’s third guideline, it’s not just important that your staff represents varying ethnicities, genders, economic backgrounds, ages, races, religions, education, and skill levels, your recruiting efforts should attract talent who represent diverse backgrounds, too. Hiring people who are different from you brings in a wealth of new perspectives and creative ideas. From the launch of a candidate search to written job descriptions to interviews to onboarding, make sure you’re hiring for diversity.

  1. Seek Selflessness

Walmart hiring managers look for altruism in candidates. This catch-all term for selflessness, kindness, and goodwill, is a reminder to seek new hires who truly value the well-being of others. When each employee starts each workday from a place of kindness, it sets a positive tone for co-workers, vendors, and customers, too.

Did You Find Your Ideal Candidate?

Don’t lose them to another opportunity! Ask ClearStar to handle their background screen so you can welcome them into your ranks quickly and with complete confidence.

How Potential Employees Try to Hide Their Pasts from Background Checks

Are your potential employees hiding a past that includes crime, firings, or a social media presence that could damage your brand reputation? Are your background checks uncovering what they’re hiding?

How Potential Employees Try to Hide Their Pasts from Background Checks 

Many potential employees have something in their background they’d like to forget. It’s not uncommon to have an ambiguous job tenure because of personality conflict, a court or criminal record due to a one-time indiscretion, or slightly embarrassing things on social media. And, most employment consultants and placement agencies will tell their candidates to be honest if things from their past may raise a red flag for a potential employer. But what about the job applicants who really do have something serious to hide? They will go to great lengths to keep a background check from discovering it.

Hiding Social Media from a Background Check

Social media accounts are the easiest way for employers to learn about a potential employee’s personality, family, friends, and interests outside of work. Hopefully, rummaging through a candidate’s Facebook, Instagram, Twitter, or Snapchat feeds uncovers mostly benign activity. But, did you know your candidate may have multiple handles created specifically to throw off potential employers? The handle your background check uncovers may be squeaky clean and also a deterrent from the one that includes bullying behavior towards others or photos of indecent behavior at parties and public events all over town.

Hiding Criminal Behavior from a Background Check

Potential employees will have the most difficult time trying to hide public records like court documents, arrests, and criminal charges­ but they will go to great lengths to try to do it. Shady attorneys and online companies make good money trying to digitally erase transgressions for these kinds of applicants. Applicants may also use intentional misspellings, incorrect phone numbers, or slightly altered names to create confusion on their background check in hopes you won’t bother to dig deeper.

Hiding At-Fault Terminations from a Background Check

Depending on the type and length of an applicant’s work history, it can be fairly easy to cover up a firing. A job candidate may fudge their start and end dates for a position, provide a fake reference for the former employer, or just not mention that place of employment at all. If your application and hiring processes aren’t well-coordinated, it can be very easy for a bad candidate to slip through using those simple tactics in hopes, again, that you won’t bother to dig deeper for the real story.

Finding Out the Truth About Your Potential Employees

It seems like today’s digital communications and internet connectivity would make it easier than ever to research a potential employee’s past. But, unless you’re taking a fine-toothed comb through the results of your background checks, it’s easy to miss some serious red flags. Cross-referencing reports, comparing a variety of sources, and simply digging beyond the social media handles a candidate gives to you are just some of the ways well-trained and experienced background check services work to find out who you’re really hiring.

Instead of running your candidates through a quick and easy background screen and hoping for the best, contact ClearStar to help you hire the best of the best from your pool of potential employees.

October 2019 Screening Compliance Update

Federal Developments

Federal Drug and Alcohol Requirements for Commercial Drivers Begin January 6
Beginning January 6, motor carriers using drivers subject to the Federal Motor Carrier Safety Administration’s drug and alcohol rules will be required to submit testing results and other information to a new electronic Drug and Alcohol Clearinghouse. Motor carriers must submit positive drug or alcohol test results as well as refusals to test. Drivers with positive tests who complete the DOT return-to-duty process and follow-up testing will also have this information recorded in the clearinghouse. Clearinghouse information will not be available to the public. DOT carriers must apply for access authority. For new drivers, motor carriers must obtain consent to search the clearinghouse. Carriers will also be required to conduct limited annual searches for current drivers, again with advance consent. Motor carriers should review their Fair Credit Reporting Act (FCRA) or other applicant and employee background search consent forms to make sure they include consent to initial and ongoing clearinghouse reviews.

Updated Guidance: Privacy Shield and the United Kingdom
The International Trade Administration’s Privacy Shield Team provided updated guidance on October 30, 2019 explaining how a Privacy Shield participant may rely on the EU-U.S. Privacy Shield Framework to receive personal data from the United Kingdom in light of the UK’s planned withdrawal from the EU.

The European Council and the United Kingdom (UK) have extended the period for withdrawal of the UK from the European Union (EU) until January 31, 2020. During the extension period, the UK will remain a Member State of the EU; as a Member State, EU law will remain applicable to and in the UK. Thereafter, more explanation can be found at on what an organization will need to implement in order to be compliant.


State Developments

California Promotes AI in Employment Hiring
Legislatures across the country are racing to keep up with the ever-expanding uses of artificial intelligence (AI) in the workplace. While to date much of the focus has been on ethical uses of AI, disclosures requirements, and informed consent (e.g., the Illinois 2019 Artificial Intelligence Video Interview Act), the California legislature recently took the bold move of promoting AI as a tool to reduce bias and discrimination in hiring and employment. As part of this effort, the California assembly introduced California Assembly Concurrent Resolution 125, titled “Bias and discrimination in hiring reduction through new technology” (CACR 125). Current California (and federal) laws permit employers to utilize tests and other selection procedures for purposes of hiring or promotion (provided they are otherwise lawful). CACR 125 endorses adding AI and algorithm-based technologies to these recruitment tools. In passing CACR 125, the California legislature observed that there continue to be disparate rates of callbacks of diverse applicants as compared to non-diverse applicants with identical resumes. The California legislature cited a 2014 report finding that resumes were the worst predictor of job success of any of the employment selection tools studied. Various AI applications would allow employers to remove the traditional indicators of race, gender and even class from resumes, and/or to rely on tools other than resumes. Ironically, while the use of AI may provide a new frontier in bias-free recruitment and retention practices, employers embracing these evolving strategies may still need to be vigilant in guarding against the age-old risks inherent in any testing or data-collection tool-the risk of disparate impact or failure to protect privacy.

Columbia, South Carolina passed an ordinance effective August 6, 2019, limiting employers’ use of criminal background checks and banning employers from inquiring about salary history on job applications
South Carolina’s capital city is the latest locality to pass such a measure, following several others that passed similar ordinances within the past year. The new “Conviction and Wage History Prohibition in City Employment and by City Contractors and City Vendors” provision of the city code places exhaustive limitations on private employers considering conviction history in employment decisions, and also prohibits employers from including questions about applicants’ wage histories on job applications. The ordinance contains additional prohibitions on employees of the City of Columbia inapplicable to private employers.

Criminal History Record Restrictions and Requirements
The conviction history measure places requirements on employers at almost every step of the background check process, including from the moment that an employer decides that a “background check” (which is not specifically defined in the ordinance) should be conducted. The ordinance prohibits employers from conducting “background checks” on applicants unless they have made a “good faith determination” that the position at issue “is of such sensitivity that a background check is warranted” or if a background check is required by law. Once an employer decides that a given position will require a background check, the ordinance then requires that job announcements and position descriptions provide the following statement: “This position is subject to a background check for any convictions directly related to its duties and responsibilities. Only job-related convictions will be considered and will not automatically disqualify the candidate.” The ordinance further prohibits job applications from containing questions about an applicant’s conviction history.

The ordinance prohibits any employer from conducting a “conviction history check” until after the applicant has received a written conditional offer letter, a document notifying the applicant of rights under the ordinance, and a request for authorization to conduct a background check. The ordinance further states that employers cannot use or access records of arrest not followed by a “valid” conviction; misdemeanor convictions where no jail sentence can be imposed; sealed, dismissed, or expunged convictions; and infractions.

In assessing an applicant’s conviction history, employers can only consider job-related convictions (unless a statute explicitly requires that certain convictions are automatic bars to employment) and cannot disqualify an applicant based even in part on convictions that are not job-related. If an employer determines that a conviction is job-related, the ordinance further requires the employer to consider the following:

  1. Whether the conviction is directly related to the duties and responsibilities of that employment position;
  2. Whether the position offers the opportunity for the same or a similar offense to occur;
  3. Whether circumstances leading to the conduct for which the person was convicted will recur in the position; and
  4. The length of time since the offense occurred.

The ordinance may place additional requirements on employers for sending out pre-adverse action notices already required by the Fair Credit Reporting Act (FCRA). If an employer may disqualify an applicant based, even in part, on an applicant’s conviction history, the ordinance requires employers to send out the pre-adverse action notice that should also identify the conviction(s) that are the basis for the potential adverse action and to provide examples of mitigation or rehabilitation evidence that the applicant may voluntarily provide (examples of which are included in the ordinance).

After the employer issues the aforementioned notice, the applicant has 10 business days in which to provide information challenging the accuracy of the information, evidence of mitigation or rehabilitation, or anything else that may rebut the basis for the adverse action. The ordinance requires employers to hold the position open until they make the final employment decision. Once 10 business days have passed, the employer must conduct an individualized assessment to consider the applicant’s evidence of rehabilitation or mitigation and the applicant’s fitness to perform the duties of the position sought, as well as the factors the EEOC recommended in its 2012 Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964.

If the employer decides not to offer the applicant employment, the employer must provide final notice of that decision. The ordinance requires that notice to include a statement that the applicant may be eligible for other positions.

The ordinance also contains several other administrative requirements. First, the ordinance requires that background check information remain confidential and not be distributed to any other entity, except as required by law. Second, the ordinance requires employers to retain application forms, records of employment, and similar records for at least three years. It even requires employers to maintain a record of the number of positions requiring background checks and, for those positions, records of the number of applicants. An employer must also maintain records on the number of applicants who (a) were provided a conditional offer; (b) were provided a pre-adverse action notice; (c) provided evidence of mitigation or rehabilitation; (d) were provided a final adverse notice; and (e) were hired.

Salary History Requirements
The ordinance’s requirements as to salary history information are more limited than the criminal history protections. The ordinance essentially excludes private employers from inquiring about an applicant’s wage history on the job application. The ordinance’s other salary history measures apply only to employees of the City of Columbia.

Implications of New York’s Expanded Data Security Law for Employers and the Broader Biometric Landscape
On October 23, 2019, the expanded data breach notification requirements of New York’s Stop Hacks and Improve Electronic Data Security (SHIELD) Act went into effect. The new law broadens the state’s existing breach notification law and imposes new security obligations on companies that do business in New York. The law has a far-reaching impact on businesses and employers across the country that have consumers and employees based in New York. The SHIELD Act substantially expands the scope and applicability of New York’s existing data breach and security laws. In the simplest terms, the SHIELD Act, broadens how the terms “data breach” and “private information” are defined under state law, to ensure that previously-excluded categories of information are now captured, to establish security requirements to safeguard that information, and to augment previous notification obligations in the event that information is breached. As a result, all businesses across the country that do business in New York may be subject to the law’s new requirements.

One particularly important aspect of the SHIELD Act is its enhanced breach notification requirements. Under New York’s previous breach notification law, the definition of “private information” subject to the law was fairly narrow and in line with other states’ breach notification laws. Specifically, New York’s data breach notification law previously required notification of a breach involving “any information concerning a natural person which, because of name, number, personal mark, or other identifier, can be used to identify such natural person,” in combination with data such as social security numbers or driver’s license/identification card numbers. Now, under the SHIELD Act and in addition to the previous categories, companies that suffer a breach of New York residents’…

  • financial account numbers that can be used to access an account without additional identifying information,
  • biometric information (e.g., fingerprint, voiceprint, retina, or iris image), or
  • usernames or email addresses, in combination with passwords or security question answers that would allow access to online accounts,

…must disclose such breach to the New York state attorney general; if a company determines that more than 500 New York residents’ private information was involved in the breach, then the notification must be made within 10 days of the company’s determination. This is just one of the many ways in which the SHIELD Act broadens the types of information and entities covered by New York’s data breach laws (in addition to the imposition of additional data security requirements under the SHIELD Act that become effective on March 21, 2020).

Biometric Data Under the Expanded Breach Notification Obligations of the SHIELD Act
As part of the expansion of privacy and security laws nationwide, many states have demonstrated increased attention on companies that handle biometric data (e.g., fingerprint, voiceprint, retina, facial, hand, or eye imaging). This growing trend in biometric legislation has resulted in laws that place proactive notice and consent obligations on biometric data collectors (like the inclusion of “biometric information” as part of the definition of “personal information” under the California Consumer Privacy Act), and some that include a private right of action, (like Illinois’ Biometric Information Privacy Act (BIPA)). BIPA has resulted in numerous class actions against companies that gather biometric data from consumers or employees.

The legislative trend toward expansive obligations has also resulted in states augmenting reactive requirements that companies face as a result of a data breach (for example, by expanding the types of personal information covered by their data breach notification laws). New York’s SHIELD Act, and California’s newly passed A.B. 1130 (signed into law on October 11), are prominent examples of this notable expansion of data breach laws to now include biometric information. Unlike Illinois’ BIPA, which has proactive notice and consent obligations as well as a private right of action for violations, many of these laws, including the SHIELD Act, focus on post-breach notification and do not confer a private right of action (but empower the state attorney general to enforce the law). In any case, both kinds of laws are indicative of continued focus on data gathering, sharing, and retention practices implemented by companies for their customers and employees that is only likely to increase.

The inclusion of biometric data in the definition of private information likely sweeps a large number of previously inapplicable practices into the scope of the law and will change how companies approach these practices. For example, companies that use fingerprinting for employee time-management or hand geometry for security-access controls will need to develop a formal understanding of how they collect and use such data and what to do in the event it is “breached,” a term for which the SHIELD Act also provides an expanded definition to include not only unauthorized acquisition but also unauthorized access. The combinative risk of enforcement of these security and notification obligations in states like New York under the SHIELD Act should encourage consumer-facing businesses and employers alike to carefully review, update, and implement comprehensive security measures, access controls, data breach response plans, and policies and procedures that adequately cover whether and how biometric data is collected, accessed, shared, and stored in order to keep pace.

The SHIELD Act’s Implications on Labor and Employment Practices
The SHIELD Act applies not only to consumer information but also to employee information. And because the SHIELD Act applies to any business that maintains the private information of New York applicants or employees and has at least one employee in New York State—regardless of size or whether the company is headquartered in New York—the SHIELD Act’s ramifications for Empire State employers are far-reaching.

The SHIELD Act also imposes additional data breach reporting requirements on “covered entities” under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”). Now, complying with HIPAA data breach disclosure requirements will not exempt a company from notifying the New York state attorney general in addition to federal authorities.

Many common practices of human resources and employee relations departments—including the maintenance of personnel records, leave and benefits documentation, background and credit history checks, direct deposit and expense reimbursements, and use of biometric time clocks and security-access controls—now fall within the expansive purview of the SHIELD Act. As of October 23, 2019, New York State employers must safeguard the broadened range of private applicant and employee information contained in their employment records and will soon be required to maintain heightened data security standards relative to such information.


Court Cases

CDIA Files Suit Against Maine to Enforce Preemption of State Law by FCRA
The Consumer Data Industry Association (“CDIA”), a trade association whose members include the three largest consumer reporting agencies (“CRAs”), recently filed a lawsuit in Maine seeking a declaratory judgment that two recently passed credit reporting laws are preempted by the Fair Credit Reporting Act.

Earlier this year, the Maine legislature passed the two bills in question, L.D. 110 and L.D. 748, and the laws took effect in Maine on September 19, amending 10 M.R.S. § 1310-H in Section (4) and (2-A), respectively. Specifically, L.D. 110 prohibits a consumer reporting agency from reporting medical debt on a consumer’s credit report until 180 days have passed since the date of first delinquency. L.D. 110 further prohibits reporting of medical debt if the consumer and creditor have settled or paid the account and requires the CRA to remove the report of that medical debt on a consumer report. Under the law, if the consumer makes regular payments pursuant to an agreement with the medical provider, the CRA must report the debt in the same manner as debt from a consumer credit transaction. These provisions, the CDIA argues, prohibit CRAs from reporting accounts unless certain conditions exist and, by doing so, they would require the CRAs to review the status of every account, including payment history, or not report the account at all.

The second state law, L.D. 748, requires CRAs to reinvestigate any debt in which a consumer provides documentation to a CRA of “economic abuse.” If the CRA finds that the debt is the result of economic abuse, it then must remove any reference to the debt. “Economic abuse” means causing an individual to be financially dependent by maintaining control over the individual’s financial resources, including unauthorized or coerced use of credit or property. Me. Rev. Stat. tit. 19-A, § 4002(3-B). CRAs already have to investigate whether the information provided by furnishers is accurate under the FCRA. The CDIA argues that the new Maine statute goes a step further in also requiring CRAs to decide whether the account was the result of economic abuse of the consumer. The CDIA notes that “[w]hile prevention of economic abuse is a laudable goal,” CRAs are not in a position to adjudicate these claims and that they lack both the knowledge and the expertise to be able to do so.

The CDIA seeks a declaratory judgment that L.D. 110 and L.D. 748 are both preempted by the FCRA. It argues that compliance with the two laws will require CRAs to reject accurate credit information, impede their ability to report accurate data, and lead to increased cost, and decreased availability, of consumer credit. The CDIA asserts that the FCRA specifically prohibits states from attempting to regulate the contents of consumer credit reports and that the Maine statutes attempt to exclude information from being included in consumer reports where the FCRA expressly contemplates the inclusion of that information. The CDIA argues that this means that pursuant to § 1681(t) of the FCRA, the Maine statutes are preempted.

This case has the potential to inform whether and how other states may regulate content that is contained in consumer credit reports.

Trade Groups Seek to Have Nevada Law Declared Preempted by FCRA and ECOA
Three industry organizations filed suit against the Nevada Attorney General and the Commissioner of the Nevada Financial Institutions Division, claiming that a newly enacted Nevada law conflicts with and is preempted by federal law, including the Fair Credit Reporting Act (FCRA) and the Equal Credit Opportunity Act (ECOA). They are seeking an injunction preventing Nevada officials from enforcing the law. The bill in question, SB 311, would allow, under certain circumstances, for an applicant who has no credit history to request that the creditor deem the credit history of the applicant to be identical to the applicant’s spouse (or former spouse). According to the bill’s sponsor, the bill was meant to assist a person who “may not be able to obtain credit, even though the person contributed to the development of the couple’s credit history, because the credit history is entirely in the spouse’s name.” If a creditor violates the new law, the violation would be deemed discrimination based on marital status. The bill was enacted earlier this year and was set to take effect on October 1, 2019, the day this lawsuit was filed.

The plaintiffs—the American Financial Services Association, the Nevada Credit Union League, and the Nevada Bankers’ Association—are industry associations whose members include financial institutions and furnishers of credit reporting information. They argue that SB 311 would force creditors to violate the FCRA by requiring them to access and use the non-applicant spouse’s consumer report without a permissible purpose. They also contend that ECOA generally prohibits creditors from requesting information concerning the spouse of an applicant. In contrast, SB 311 would require creditors to obtain information about a spouse or ex-spouse. The industry organizations also assert the Nevada bill violates longstanding privacy and data security rules by requiring creditors to access credit information and disclose it to an applicant without the knowledge of the consumer (the spouse or ex-spouse). Finally, they claim the law is “hopelessly unworkable” from a practical standpoint as creditors have no way of obtaining a credit report associated with a particular period in time, such as during a marriage, so the credit report they would be required to obtain would not necessarily be an accurate reflection of an ex-spouse’s credit contributions.

This action is similar to recent litigation in Maine where the Consumer Data Industry Association is seeking for the court to declare that two newly enacted state statutes are preempted by the FCRA (see above). The two cases taken together show the tension between attempts by states to protect consumers and the financial services industry’s need for uniform applicability in a complex area of law.

California District Court Certifies FCRA Class Action Against Experian After Servicer Went Out of Business
In a case originally filed in March 2016 and following the successful appeal of a grant of summary judgment in favor of Experian Information Solutions, Inc. (“Experian”), Judge Andrew Guilford of the United Stated District Court for the Central District of California certified a class of consumers whose reporting by Experian was allegedly “misleading” after a loan servicer went out of business.

Delbert Services Corporation (“Delbert”) was a servicer for internet loans issued by Western Sky Financial, LLC. In January 2015, Delbert went out of business and told Experian that it wanted to “discontinue use of any and all services provided by Experian.” Experian responded that it had deleted all Delbert loans from its database. In reality, however, Experian continued to report the loans until April 2016. In the Complaint, plaintiff Demeta Reyes alleged a single claim for relief under the Fair Credit Reporting Act of 1970 (“FCRA”), 15 U.S.C. § 1681 et seq. Specifically, she asserted that Experian willfully failed to “follow reasonable procedures to assure maximum possible accuracy of the information” contained in her credit report. See 15 U.S.C. §§ 1681e(b), 1681n(a).

Experian filed a motion for summary judgment, arguing that it was entitled to summary judgment because (1) its “reporting of [Plaintiff’s] loan was at all times indisputably accurate.”; and (2) even assuming a prima facie case of inaccuracy, there was no evidence of a “willful” violation. Judge Guilford agreed, finding that Experian’s reporting of plaintiff’s loan was “neither patently inaccurate nor unduly misleading.” He granted summary judgment on October 13, 2017. The Ninth Circuit, however, reversed Judge Guilford. In an unreported opinion, it found that plaintiff raised a genuine issue of material fact as to whether Experian’s continued reporting of plaintiff’s loan was “misleading in such a way and to such an extent that it can be expected to adversely affect credit decisions.” It found that when Experian was reporting an account from the defunct Delbert, it was reporting an account that was no longer verifiable and that plaintiff could not make current since Delbert was no longer in business. Also, Experian continued to report plaintiff’s past-due history, but had deleted her positive payment history. The Ninth Circuit found that a reasonable jury could conclude that Experian’s continued reporting of plaintiff’s account, “either on its own, or coupled with the deletion of portions of [plaintiff]’s positive payment history on the same loan, was materially misleading.” On remand, plaintiff requested certification of the following class, “All persons whose Experian consumer report contained an account from Delbert Services Corp. reflecting delinquency on a loan originated by Western Sky Financial, LLC after January 21, 2015…” Judge Guilford certified the class on October 3, 2019. The case is Demeta Reyes v. Experian Information Solutions Inc., case number 8:16-cv-00563, in the U.S. District Court for the Central District of California.

Will the Eleventh Circuit fall in line with its sister circuits in interpreting Spokeo’s standing requirements in FACTA cases?
For more than a decade, printed credit card receipts have been the subject of considerable litigation all over the country. The Fair and Accurate Credit Transactions Act (“FACTA”), enacted in 2003, prohibits retailers from printing “more than the last 5 digits of the credit card number or the expiration date” on a consumer’s receipt. The potential penalty for a FACTA violation is harsh: the statute awards up to $1,000 damages per violation when the conduct is willful, making it an area ripe for class action lawsuits—with restaurants, grocery stores, and other food retailers being primary targets.

Post-Spokeo v. Robins, however, the question of a plaintiff’s standing to assert statutorily-based claims (like FACTA violations) has become the subject of considerable confusion and debate. See Spokeo, 136 S. Ct. 1540 (2016) (holding that a plaintiff does not “automatically satisf[y] the injury-in-fact requirement whenever a statute grants a person a statutory right and purports to authorize that person to sue to vindicate that right” and that a “bare procedural violation” of a statute “divorced from any concrete harm” is simply not enough).

Over the past several years a prevailing view has emerged that plaintiffs need to show something more than just a bare procedural violation (i.e. that the receipt was printed) to satisfy Spokeo. Indeed, the Second, Third, Seventh, and Ninth Circuits all have all upheld dismissals of FACTA claims for lack of standing.

For example, in Katz v. Donna Karan Co., LLC, 872 F.3d 114, 116 (2d Cir. 2017), the Second Circuit affirmed the district court’s holding that the plaintiff lacked standing because the first six digits of a credit or debit card “do not disclose any information about Plaintiff; but rather identify the institution that issued the card to the card holder,” and therefore, did not give rise to a concrete injury. See Katz, 872 F.3d at 118, 119.

Similarly, in Noble v. Nevada Checker Cab Corp., 726 Fed. App’x 582, 584 (9th Cir. 2018), the Ninth Circuit held that disclosure of first digit of card number was not “the sort of revelation of information that Congress determined could lead to identity theft” because a card network/brand could be printed without violating FACTA. See also Bassett v. ABM Parking Servs., 883 F.3d 776, 777-78 (9th Cir. 2018) (affirming dismissal of FACTA claim based on disclosure of expiration date where “private information was not disclosed to anyone but [the plaintiff]”); Meyers v. Nicolet Rest. Of De Pere, LLC, 843 F.3d 724, 727-28 (7th Cir. 2016) (affirming dismissal of claim alleging violation of FACTA based on printing of an expiration date for lack of standing where plaintiff failed to allege that he either suffered concrete harm because of the violation, or that the violation created “any appreciable risk of harm” where no one else saw the receipt); Kamal v. J. Crew Grp., Inc., 918 F.3d 102, 115-19 (3d Cir. 2019) (affirming dismissal of FACTA complaint based on printing of first six digits and last four digits of card number and holding claimed injury of heightened risk of identity theft was bare procedural violation that did not confer standing).

In April of this year, the Eleventh Circuit issued its holding in Muransky v. Godiva Chocolatier, Inc., 922 F.3d 1175 (11th Cir. 2019), a case that has been viewed as an outlier on the issue of FACTA standing.

While the District of Columbia Circuit issued an opinion in July of this year in Jeffries v. Volume Servs. Am., Inc., 928 F.3d 1059, 1062 (D.C. Cir. 2019) recognizing the plaintiff’s standing in a particularly egregious FACTA fact pattern (the receipt disclosed all sixteen digits of the credit card number, the expiration date, and the name of the plaintiff’s card provider), Muransky represents the only Circuit decision to hold that the disclosure the first six digits on a receipt—digits that correspond exclusively to bank issuer information and not cardholder information—is sufficient to confer standing absent a plaintiff’s showing of tangible injury.

The holding in Muransky was limited: it was expressly predicated on a facial challenge levied by the defendant, which, as the Eleventh Circuit noted, required the Court to accept as true Plaintiff’s allegation that the printing of the first six and last four digits of his credit card exposed him to a “heightened risk of identity theft.” Muransky, 922 F.3d at 1190. Indeed, the Eleventh Circuit distinguished Muransky from the Katz case, where the defendant provided the district court with evidence that the first six digits of a credit card number “simply identify the card issuer and provide no personally identifying information about the plaintiff.” Katz, 872 F.3d at 116.

Nevertheless, not surprisingly, since Muransky was issued earlier this year, FACTA class action cases have been filed in the Eleventh Circuit with increasing frequency. And because a petition for rehearing en banc was submitted in Muransky (along with several amicus briefs), many district court cases within the circuit have been in limbo, awaiting the appellate court’s decision on the petition.

On Friday, a new development emerged: the Eleventh Circuit entered an order granting the petition to rehear the case en banc and vacating the panel’s prior opinion. See Muransky v. Godiva Chocolatier, Inc., No. 16-16486 (11th Cir. Oct. 4, 2019). The Court has not yet indicated when the case will be heard, but given the stakes for FACTA litigation, it is one to watch over the coming months.

Federal Appeals Court Holds Test for Illegal Drugs is not an Impermissible Medical Examination, Even if Test May Reveal Lawful Drug Use
A federal appeals court upheld the termination of an employee who tested positive for amphetamines on a random drug test—despite his claim that the result was due to over-the-counter drug use—and rejected his arguments that the random drug test was an impermissible medical examination and that the Medical Review Officer’s questions constituted an impermissible disability-related inquiry. Turner v. Phillips 66 Co., Case No. 19-5030 (10th Cir. Oct. 16, 2019).

Phillips 66 Co., the employer, conducted a random drug test on its employee, Richard Turner. Three days later, Mr. Turner was involved in a workplace accident and submitted to a post-accident drug test. On the day of the post-accident test, the employer learned that Mr. Turner had tested positive for amphetamines on the random drug test. Mr. Turner advised the Medical Review Officer (MRO) that the positive random drug test was due to his use of over-the-counter Sudafed, which his treating physician confirmed in writing. Phillips 66 terminated Mr. Turner’s employment under its policy providing that if an employee tests positive for drugs, his or her employment will be terminated. Mr. Turner appealed the termination decision pursuant to the Company’s policy. He submitted to a hair test at an independent laboratory and that test was negative. In addition, the results of his post-accident test also were negative. A confirmatory re-test of Mr. Turner’s original random urine specimen, however, confirmed that that test result was positive for amphetamines. Phillips 66 denied Mr. Turner’s appeal and upheld the termination. Thereafter, Mr. Turner filed a discrimination charge with the Equal Employment Opportunity Commission, alleging disability discrimination in violation of the Americans With Disabilities Act (ADA). The EEOC dismissed the charge. Mr. Turner then filed a complaint alleging that: (1) he was subjected to an impermissible medical examination and disability-related inquiry; (2) he was terminated due to a disability (allergies); (3) he was “regarded as” disabled; (4) the drug testing violated the Oklahoma drug testing law. The district court granted summary judgment to Phillips 66 on each of Mr. Turner’s ADA claims. Mr. Turner appealed.

The Tenth Circuit Court of Appeals affirmed the district court’s grant of summary judgment to Phillips 66.

First, the court rejected Mr. Turner’s argument that his drug test and discussion with the MRO about his medications violated the ADA. Mr. Turner argued that, because he tested positive for amphetamines due to taking an over-the-counter medication, the employer’s drug test “was not for illegal use of drugs as permitted by [the ADA], but went beyond that to legal and appropriate use.” Mr. Turner further argued that the drug test was a medical examination that required Phillips 66 to show that it was “job-related and consistent with business necessity” under the ADA. The court disagreed, holding that a drug test does not become a medical examination simply because the drug test revealed the potential use of legal drugs. The court similarly rejected Mr. Turner’s argument that the MRO’s discussion with him about his use of medications violated the ADA as being an impermissible disability-related inquiry.

Second, the court rejected Mr. Turner’s argument that the district court erred in granting summary judgment to Phillips 66 on his “traditional” and “regarded as” ADA disability discrimination claims. The court affirmed the district court’s determination that Phillips 66 had set forth a legitimate, non-discriminatory reason for Mr. Turner’s termination—that is, his positive drug test—and that Mr. Turner had failed to show pretext. While Mr. Turner attempted to argue that he did not need to show pretext as his evidence was direct, the court rejected that argument, finding that it did not meet the requirement that direct evidence must show, without inference, that the employment action was taken as a result of the employee’s disability. Because Mr. Turner failed to articulate or even argue pretext, the court held that his disability discrimination claims under the ADA failed.


International Developments

European Court Ruling Spells End of Pre-Ticked Cookie Consent Forms Under GDPR
The Court of Justice of the European Union (Curia) has made a ruling with far-reaching consequences for digital advertisers and media owners: pre-ticked forms for cookies on websites have been ruled incapable of legally gathering consent to track consumers. Weeks after a tense Dmexco conference, where the consent framework was questioned alongside the broader legality of programmatic advertising’s real-time bidding, this issue boiled over during a legal case against lottery site Planet 49, which requests players to consent to pre-ticked cookies to access its game. Its pre-ticked cookie boxes (favored by countless websites after the introduction of GDPR) did not legally gather consent, found the court. Instead users must actively opt-in to have each company (sometimes in their hundreds) follow them across the web. The German Federation of Consumer Organizations challenged the lottery. German courts then bumped the ruling up to the Court of Justice to interpret EU law. The judgement passed Monday (1 October) in a case that has lasted more than a year. It read: “The court decides that the consent which a website user must give to the storage of and access to cookies on his or her equipment is not validly constituted by way of a pre-checked checkbox which that user must deselect to refuse his or her consent.

“That decision is unaffected by whether or not the information stored or accessed on the user’s equipment is personal data. EU law aims to protect the user from any interference with his or her private life, in particular, from the risk that hidden identifiers and other similar devices enter those users’ terminal equipment without their knowledge.” The user interface did not allow clear access to analyze cookie partners, nor did it inform users that third party cookies may have access (or for how long). And finally, consent was manufactured to provide access to a gambling game that births ethical if not legal concerns about how advertisers could manufacture consent in the future.

Rowly Bourne, founder of Rezonence, home of the FreeWall solution, helping publishers monetize audience data, said; “If you can no longer auto-opt people in, then adtech is going to have a real problem, because consumers do not have a clue who 99% of the 7,040 adtech vendors are. After all, most people think Adobe makes PDFs. So no one will actively opt-in to companies they not heard of. And this will end up shining a light on how consent is achieved in the app-industry. “This is only going to give further ammunition to the ICO, who already highlighted their concerns regarding consent in their ‘Update report into adtech and real time bidding’.” Bourne sees a “good opportunity for publishers, as consumers know who they are, and will opt-in”. There’s also an opportunity for companies like Rezonence “who believed explicit consumer consent was going to be the conclusion from the GDPR are now well placed”.

The Next Web reported the decision even rendered the Curia press release ruling page as illegal with pre-ticked consent boxes. It appears that the web user experience will be further eroded in the name of user privacy with more strident cookie checks being implemented. On the other hand, web users may have been dissuaded from opting out of cookies previously due to the sheer length of time it takes to un-tick pre-selected boxes.

What U.S. Investors Need to Know About Mexican Labor Law
If you are a human resources manager or an in-house labor lawyer for a U.S. company that is doing business or contemplating doing business in Mexico, you do need to be aware of key differences between U.S. and Mexican labor laws. First, and foremost, there is a presumption under Mexican law that all employment contracts are permanent and employees can only be terminated for just cause. An employee who is discharged without cause is entitled to three months’ salary, back wages, plus 20 days’ pay for each year of service, and any accrued salary and bonuses. Employees are also entitled to severance payments equal to 12 days’ salary for each year of service. The 2012 reforms to Mexico’s labor laws, however, did introduce additional hiring options for employers, such as trial employment periods and initial training periods. These reforms have added some flexibility for employers, especially foreign investors who sometimes need to hire large numbers of employees in a short amount of time. U.S. investors also need to be careful about using employees of contractors. Under the Mexican Labor Code, outsourced employees of a service provider (1) may not perform all activities carried out in the contracting party’s workplace; (2) must perform a specialized type of service; and (3) may not perform tasks equal or similar to those being carried out by the rest of the contracting party’s employees. As for dealing with Mexican labor unions, investors need to understand that Mexican labor law is currently undergoing a dramatic transformation. While historically, unions were often co-opted by either the governing political party or Mexico’s business class, under Mexico’s new labor law, employees are supposed to have real collective bargaining rights and a bargaining representative of their choice. In fact, earlier this week, Lopez Obrador met with a delegation of Democrats from the United States House of Representatives and vowed to enforce the new labor laws. There have been some concerns that the new law could create scenarios—at least initially—where multiple unions compete (hopefully peacefully) to represent employees in the same workplace.

Identification, Analysis, and Prevention of Psychosocial Risks in the Workplace in Mexico
Federal Workplace Safety and Health Regulations, in force since February 2015, require employers to identify psychosocial risk factors, which are those that may cause non-organic anxiety and serious stress or adaptation problems, resulting from the nature of the work, the type of shift and exposure to severe traumatic events or acts of workplace violence.

Employer Obligations
Employers have the following specific obligations in the area of psychosocial risk factors:

  • Identify and analyze activities that may generate risks due to the nature of the work performed or the type of labor shift;
  • Identify employees that have been subject to severe traumatic events or acts of workplace violence and evaluate them clinically;
  • Adopt pertinent preventive measures to mitigate risk factors;
  • Carry out clinical exams or evaluations on personnel that has been exposed to psychosocial risk factors as required;
  • Inform employees of possible alterations to their health due to exposure to psychosocial risk factors and
  • Keep registries on preventive measures adopted and on results of clinical exams or evaluations.

Among the aspects that must be considered within psychosocial risk factors, are hazardous or unsafe work conditions, work that demands high responsibility or work that requires intense concentration and attention for prolonged periods of time.

Mexican Official Standard NOM-035-STPS-2018 (“NOM-035”) establishes guidelines for identifying and analyzing psychosocial risk factors in the workplace. It will become effective on October 23, 2019 and establishes different obligations for employers, taking into account the number of employees in a workplace. In all workplaces, employers are required to establish in writing as well as implement, maintain and divulge a policy to prevent psychosocial risk factors. The policy should contemplate (a) prevention of psychosocial risk factors, (b) prevention of labor violence and (c) promotion of a favorable organizational environment.

Workplaces having 50 employees or more, require employers to analyze psychosocial risk factors applying the guides established by NOM-035. Representative samplings may be carried out. The following elements must b