The Litigation Landscape of 2020

In addition to legislative and regulatory change, employment compliance means staying on top of court findings. Although there are many issues being decided across the nation, the 2020 court season centered on two key tops: criminal history and Fair Credit Reporting Act (FCRA) compliance.

Here’s what you need to know.

Criminal History

As we reported in our Regulatory and Legislative Round-Up, the use of criminal background information in hiring decisions has become a contested practice. Ban the Box and Fair Chance laws expanded significantly through 2020, but the potential for discrimination and the particulars of the background check authorization process have also been addressed by the courts.

New York, in particular, is turning out to be a hotbed of such litigation. Recent events include a $1.8 million settlement and a lawsuit filed in June regarding individualized adjudication.

And then in one of the most prominent cases of the year, a nationwide bank was sued for allegations it wrongfully discriminated. The company ran fingerprints it had on file against the FBI database, which revealed a charge that has been dismissed. You can get the full story here.

FCRA Remains a Risk

We’ve been saying for a while that employers must remain vigilant on FCRA and 2020 bore out this advice. Litigation related to FCRA, often involving the Pre-Adverse and Adverse Action process, has been on the rise, and a mixed slate of outcomes leaves a murky picture for employers:

• In welcome news, a Massachusetts company won a claim in which the court determined a “mere technical violation” of the FCRA wasn’t sufficient to bring a case.
• Employers notched several more wins on FCRA disclosure form rulings, including one noting that a “concise explanation” on the disclosure form is permissible.
• A D.C. District Court, on the other hand, allowed FCRA litigation to proceed, with possible negative ramifications because the company assumed the pre-hire background check authorization enabled them to conduct an investigation post-hire.
• A prominent global coffee chain settled an FCRA suit. Although the payout to the plaintiffs was relatively small, attorneys’ fees left a million-dollar dent in the budget.

Do you find FCRA requirements confusing? We feel your pain! That’s why we also published a two-part explainer to help:

• How to Ensure FCRA-Compliant Use of Consumer Reports for Hiring: Part I
• How to Ensure FCRA-Compliant Use of Consumer Reports for Hiring: Part II

What’s Coming?

The only certainty in employment litigation is change, and employers can expect more developments in the coming months. Asurint will be here to update you.

And remember, this blog post is intended for information only. Be sure to consult with qualified legal counsel to determine what changes, if any, may be needed.

Download Our FCRA Guide!

Need more guidance on the ins and outs of the FCRA? Help yourself learn how to play by the rules and download our new FCRA resource to share with your recruiter colleagues.