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Background Checks: The Advent of the New California Employment Class Action

Class action litigation brought under the Fair Credit Reporting Act (FCRA) is on the rise—particularly in California—after the US Court of Appeals for the Ninth Circuit issued a 2017 decision applying a hypertechnical approach to the FCRA’s disclosure requirements. Background checks are an integral part of the hiring process, but they open employers up to lawsuits for noncompliance with disclosure or adverse action requirements. Plaintiffs’ firms are turning their attention to these cases because of the potential for statutory and actual damages, punitive damages, costs and attorneys’ fees. Please join us for a complimentary webinar Thursday, July 30 as we discuss strategies to help employers avoid and defend these claims. Learn more and register.

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Employment, Benefits and Compensation Forum: Control Your Own Headlines

In today’s high-stakes environment, in-house counsel and HR professionals are often on the frontlines, responding to headlines that threaten business and reputational objectives. Join McDermott Will & Emery’s Employment and Employee Benefits practice groups at a half-day forum in our Chicago office on Oct. 10. This forward-looking program is designed to drive conversation around emerging trends to help employers craft their own narrative, instead of being held captive by it. See full event details and register here.

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New Guidance on Background Checks Issued by the FTC and EEOC

Last month, the Federal Trade Commission (FTC) and the Equal Employment Opportunity Commission (EEOC) issued joint guidance addressing the use of background checks in employment decisions.  The guidance does not offer new requirements related to background checks, but rather serves as a reminder to employers of their obligations under federal law when they use background checks, and creates a user-friendly guide to applicants and employees regarding their rights with respect to background checks. The guidance consists of two documents – one for employers, “Background Checks: What Employers Need to Know,” and one for applicants and employees, “Background Checks: What Job Applicants and Employees Should Know.”  The first document, “What Employers Need to Know,” offers guidance to employers on their existing legal obligations under the Fair Credit Reporting Act (FRCA), a federal law enforced by the FTC, and federal non-discrimination laws enforced by the EEOC....

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FTC: Employers Who Buy Profiles from Data Brokers to Supply Profiles on Applicants or Employees Must Comply with the FCRA

by Jennifer S. Geetter, Heather Egan Sussman and Carla A. R. Hine We recently released a Hot Topic that details the Federal Trade Commission's (FTC) settlement with Spokeo, Inc.  Spokeo collected information about individuals from online and offline sources to create profiles that included contact information, marital status, age range and in some cases included a person’s hobbies, ethnicity, religion, participation on social networking sites and photos that Spokeo attributed to a particular individual.  Spokeo marketed these profiles to companies in the human resources, background screening and recruiting industries as information to serve as a factor in deciding whether to interview or hire a job candidate.  The FTC concluded that Spokeo acted as a consumer reporting agency and thus violated the Fair Credit Reporting Act (FCRA) by: (1) failing to ensure the consumer reports it sold were used for legally permissible purposes; (2) failing...

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