The CFPB Cautions Employers About Using Technology to Track, Assess, and Evaluate Workers

by Rod M. Fliegel, William J. Simmons, Chad J. Kaldor - Littler

On October 24, 2024, the federal Consumer Financial Protection Bureau (CFPB) published a circular cautioning employers about using workplace tracking technology, including AI, under the Fair Credit Reporting Act (FCRA). The CFPB has the primary regulatory and interpretive role regarding the FCRA and shares the enforcement role with the Federal Trade Commission (FTC). The gist of the CFPB’s circular is that employers may need to comply with the FCRA’s employment-related provisions before using such technology. In his prepared written remarks, CFPB Director Rohit Chopra stated: “We are making clear that employers that traffic in data about workers and make decisions – including hiring and firing – using third-party scores based on tracking must adhere to federal protections.”

Read more: https://www.littler.com/publication-press/publication/cfpb-cautions-employers-about-using-technology-track-assess-and

Former Employee Sues Amazon Over Alleged Fair Credit Reporting Act Violation

by Nothern California Record

A former Amazon employee has lost her appeal in a class action lawsuit against the company, alleging violations of the Fair Credit Reporting Act (FCRA). Lovenia Scott filed the complaint on January 8, 2020, in San Francisco City & County Superior Court against Golden State FC, LLC (now known as Amazon.com Services LLC) and Amazon.com, Inc.

Read more: https://norcalrecord.com/stories/662606621-former-employee-sues-amazon-over-alleged-fair-credit-reporting-act-violation

State Laws on Screening and Federal Preemption – Where Are We Now and Where Are We Heading?

by David M. Gettings, Kim Phan, Cindy D. Hanson, Timothy J. St. George - Troutman Pepper

FCRA Focus Podcast

Please join Troutman Pepper Partner Dave Gettings and colleagues Tim St. George and Cindy Hanson for a highly informative discussion on federal preemption as it relates to state laws and the Fair Credit Reporting Act (FCRA). This episode provides listeners with an overview of important state and local legislation governing background screening, along with discussions about how federal preemption might affect required compliance with these state and local laws.

Read more: https://www.troutman.com/insights/state-laws-on-screening-and-federal-preemption-where-are-we-now-and-where-are-we-heading.html

Looking for Skeletons in the Closet? Avoid These Background Check Mistakes

by Jake Proudfoot, Akerman LLP - JDSupra

A scary surprise is fun to encounter when you are in a haunted house at a Halloween event, but not so much fun when you are performing a background check on a potential employee. Even worse is finding out after the fact that you failed to comply with one of the many legal requirements, and that your company is now suddenly facing a fine or lawsuit. This Halloween, make background checks and hiring much less spooky by avoiding these common mistakes.

Read more: https://www.jdsupra.com/legalnews/looking-for-skeletons-in-the-closet-6454570/

CFPB Extends Deadline for FCRA Rulemaking Feedback by One Week

by David Anthony, David Gettings, Ethan Ostroff, Kim Phan, Ronald Raether, Chris Willis, Troutman Pepper - JD Supra

As discussed here, on September 21 the Consumer Financial Protection Bureau (CFPB) released an outline of its plans for rulemaking under the Fair Credit Reporting Act (FCRA). The outline was supplied for initial comment to a panel of small business representatives convened under the Small Business Regulatory Enforcement Fairness Act (SBREFA).

Read more: https://www.jdsupra.com/legalnews/cfpb-extends-deadline-for-fcra-7003211/

FTC Settles FCRA Suit Against “People-Search” Companies

by Sheppard Mullin Richter & Hampton LLP - JD Supra

On September 11, the FTC announced that it had reached a settlement with two “people-search” companies which would resolve charges that the companies had engaged in practices that violated the Fair Credit Reporting Act (“FCRA”). The California-based defendants market “people-search” services, allowing users to search unlimited background reports on individuals, and charge monthly subscription fees to view the full reports. Searches can be run using an individual’s name and/or city and state of residence.

Read more: https://www.jdsupra.com/legalnews/ftc-settles-fcra-suit-against-people-5069104/

U.S. Supreme Court Focuses on Subjective Intent in Overturning False Claim Act Cases

by Duane Morris

Writing for a unanimous Supreme Court of the United States, on June 1, 2023, Justice Clarence Thomas issued a decision clarifying the knowledge requirement for cases brought pursuant to the False Claims Act (FCA). In overturning the consolidated cases of United States ex rel. Schutte et al. v. SuperValu Inc., et al. and United States ex rel. Proctor v. Safeway, Inc., the Supreme Court rejected the Seventh Circuit’s focus on the objectively reasonable interpretation of an ambiguous rule or regulation. Instead, the Court held that the FCA’s scienter requirement refers to the defendant’s subjective knowledge and belief at the time the claim is submitted.

Read more: https://www.duanemorris.com/alerts/us_supreme_court_focuses_subjective_intent_overturning_false_claims_act_cases_0623.html

No FCRA Violations Found Where Defendants Promptly Corrected Inaccurate Data and Updated Plaintiffs’ Consumer Report

by Rachel Ommerman, Virginia Bell Flynn, David N. Anthony - Consumer Financial Services Law Monitor

In a recent decision, the U.S. District Court for the Eastern District of Pennsylvania granted summary judgment in a Fair Credit Reporting Act (FCRA) case where a bank promptly corrected inaccurate mortgage payment information furnished to three national consumer reporting agencies (CRAs).

Read more: https://www.consumerfinancialserviceslawmonitor.com/2023/04/no-fcra-violations-found-where-defendants-promptly-corrected-inaccurate-data-and-updated-plaintiffs-consumer-report/#page=1

How one little background check mistake landed this employer in court

by Tom D’Agostino - HR Morning

Do you conduct background checks on job applicants? If the answer is yes, this is an important case to know.

A state appeals court in California has revived a putative class action suit that accuses an employer of willfully violating the federal Fair Credit and Reporting Act (FCRA) by providing job applicants with an improper disclosure relating to its acquisition and use of consumer reports.

Read more: https://www.hrmorning.com/news/background-checks/

Federal Appeals Court Sides with Employer in Job Applicant’s Background Check Suit: 3 Steps to Avoid Similar Claims

by Richard Millisor, Fisher Phillips - JD Supra

A job applicant who didn’t disclose a felony conviction can’t sue her prospective employer under a federal background-check law for failing to provide proper notice before rescinding her offer, according to a recent decision from a federal appeals court. The job applicant didn’t claim the background report was wrong. Instead, she argued that she should have been given a chance to explain the conviction before the offer was withdrawn. In Schumacher v. SC Data Center, Inc., the 8th U.S. Circuit Court of Appeals ruled in favor of the employer even though it technically violated the Fair Credit Reporting Act (FCRA). The act doesn’t give applicants the right to explain negative but accurate information in a consumer report before the employer can make an adverse employment decision, the court said in a May 3 decision. Although the ruling is good news for employers, you should take the following three steps to comply with FCRA’s notice requirements and avoid similar claims.

Read more: https://www.jdsupra.com/legalnews/federal-appeals-court-sides-with-1410611/