Recently a class action lawsuit over alleged FCRA violations against Home Depot was dismissed by a U.S. District Court. What makes this newsworthy are the circumstances on why this lawsuit was dismissed.
In Saltzbreg v. Home Depot, U.S.A., Inc., the plaintiff filed a class action lawsuit alleging that Home Depot violated the FCRA by failing to provide proper notification that a background check would be conducted and failing to obtain proper authorization before conducting a background check.
The plaintiff accused Home Depot of failing to use a stand-alone background check disclosure form by including a liability waiver. The lawsuit claimed that because the form was defective, the authorization to conduct that background check was invalid as well. However, the plaintiff did not allege harm as a result of receiving an alleged non-compliant disclosure form. The complaint was dismissed because the court did not find that the plaintiff suffered an injury-in-fact to confer Article III standing.
The 2016 U.S. Supreme case Spokeo, Inc. v. Robins is the case that initially established the legal precedent for this decision. Article III standing requires a concrete injury even in relation to a statutory violation. Simply asserting a FCRA violation is not sufficient without connecting it to a concrete injury.
For employers defending FCRA class actions this is more good news that provides them additional ways to defend themselves in a court of law. However, following best practices is the best way to avoid litigation in the first place. Employers should not be using any background check disclosure forms that contain any extraneous information. The risks of doing so outweigh any perceived benefit.
All employers should periodically review all forms, materials, and procedures connected to the hiring process to ensure they are compliant with the law.
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