Human resource professionals need to keep their eyes peeled for a new threat in the workplace, and it comes disguised as an everyday applicant.  Although they appear to be the same as all other applicants, these seemingly normal individuals are not looking for employment opportunities.  Instead, they are scrutinizing every application, release and form they can get their hands on, looking for violations of the Fair Credit Reporting Act (FCRA) so that they can sue. 

Dubbed “Professional Plaintiffs,” these individuals make a very good living applying for hundreds of jobs across the country in hopes of getting to the Background Check stage.  This allows the Professional Plaintiff to obtain employment applications, authorization and disclosure forms, and document the process used by the company in question.  They have trained themselves to spot FCRA violations which they then use to threaten the company, in hopes of settling outside of court.  When the threat of a lawsuit isn’t enough, the Professional Plaintiffs are happy to produce the violations as evidence for the court.

Most recently, Cory Groshek of Green Bay, Wisconsin applied for over 550 jobs across the United States with the sole purpose of finding violations of the FCRA.  He found at least 40 companies to threaten, which resulted in over $200,000 in settlements for Groshek.  However, he was met with resistance when he tried the tactic on Time Warner Cable. 

Groshek threatened Time Warner Cable with a Class Action Lawsuit that would involve all recent new hires if they did not immediately pay him an undisclosed settlement based on FCRA violations he found during their Background Checking process.  Time Warner Cable refused to settle and instead filed a motion to dismiss in July, 2015.  While Groshek V. Time Warner Cable waned on, another notable case was being decided, which greatly affected the outcome of Groshek’s case.

In Spokeo V. Robins the Supreme Court of the United States was tasked with determining if Class Action Lawsuits can be filed for violations of the FCRA even if the violation did not result in injury to the plaintiff.  In May, 2016 the Supreme Court ruled that a plaintiff must show injury has occurred and that the injury must be particular and concrete.  Therefore, if an injury did not occur, the plaintiff has no basis to file a claim.

Time Warner Cable was able to cite Spokeo V. Robins in their case, proving that the violations alleged by Groshek did not result in concrete or particular injury.  In fact, Groshek had been offered the job before he launched his attack on Time Warner Cable.  On August 9, 2016 the United States District Court dismissed Grosheks claim stating he could prove no injury had occurred.  Any employer approached by a Professional Plaintiff should be aware that the ruling in Spokeo V. Robins means despite their violations of the FCRA, they should not settle outside of court with these individuals.  They must be able to prove injury.

It is still important to note that although plaintiffs must prove concrete or particular injury in their lawsuits, the Equal Employment Opportunity Commission (EEOC) does not.  They can sue companies for violations of the FCRA.  In order to avoid a “shakedown” by a Professional Plaintiff and stay off of the EEOC’s radar, always make sure to follow the following FCRA guidelines:

·       Applicants must sign a “clear and conspicuous disclosure” document stating they are aware that the information obtained in a consumer credit report may be used in the hiring decision. 

·       If the consumer credit report will entail investigative information such as personal references who speak to the applicants’ reputation or character, the employer must also inform the applicant by supplying a general overview of what might be obtained in the report.

·       The applicant must sign a stand-alone authorization for the consumer credit report to be obtained.  If the applicant’s consumer credit report will be obtained multiple times over their employment, this document must also clearly state this. 

·       When denying employment due to results of a background check, a Pre-Adverse Action notice must be supplied to the applicant or employee with a copy of the full consumer credit report, as well as a copy of “A Summary of Your Rights Under the Fair Credit Reporting Act” followed by an Adverse Action Notice at least five business days later.

Sources: esrcheck.com, jsonline.com, mondaq.com

For information about ASE’s professional background checking services, email Nicole Sitter or call her at 248-223-8058.