Employers in California are frequently faced with class action lawsuits brought by current or former employees. Oftentimes, these actions are brought for alleged wage and hour violations, but we’ve seen an uptick in suits claiming violations of state and federal background check laws — even for minor technical errors. However, in an occurrence that may be as rare as a unicorn sighting, a California Court of Appeal recently delivered some good news for employers. The court affirmed a decision to dismiss a former employee’s class action claiming that a convenience store chain’s background check forms were defective. Notably, the court did not actually decide whether the forms were defective, and instead dismissed the case because the worker could not show he suffered an actual harm or injury. This potentially significant decision could curtail class actions that merely assert technical violations unaccompanied by any harm to consumers or employees. What do you need to know about the decision and its impact on employers?
What Happened Here?
As part of the hiring process for Circle K Stores, Ernesto Limon received a set of disclosure forms and authorized Circle K to conduct a background check. Limon was hired by Circle K with no issue regarding his background check. However, after his employment ended, he sued Circle K in federal court for alleged violations of the Fair Credit Reporting Act (FCRA), the federal law governing background checks.
The FCRA requires employers to...
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