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A lawsuit against the retailer claimed they willfully violated federal law. They were granted a summary judgment, but that was overturned by a court of appeal.

About The Lawsuit

An individual who applied for a job at Barnes & Noble went through the standard hiring process and authorized a background check. Later, the applicant alleged the retailer violated the Fair Credit Reporting Act (FCRA) by including extra content in their disclosure. The FCRA states a disclosure must be clear and conspicuous and consist of nothing other than the disclosure.

According to the suit, which included numerous people who had been screened on behalf of Barnes & Noble over a 5-year period, the retailer had “willfully” violated federal law by having non-essential text in their disclosure.

A Favorable Outcome

Representation for the retailer argued that there was no willful violation and called for a summary judgment. The court agreed and said:

• The inclusion of additional content was simply a mistake and did not indicate willfulness.
• Barnes & Noble relied on good faith in their counsel, which showed they were attempting to achieve compliance.
• This issue was just a miscommunication caused by a watermark.

Following this verdict, the plaintiff filed an appeal.

The Appeal

The California Court of Appeal for the Fourth District, Division One heard the appeal. This court reversed the summary judgment and allowed the case to proceed. Following their review, the court decreed:

• Barnes & Noble had willfully violated the FCRA because it breached a clear provision of the law.
• There was at least one employee who was involved in the hiring process that was aware their disclosure contained extraneous information.
• The company did not properly train its employees on compliance measures.
• No monitoring system was implemented to ensure the company was compliant with the FCRA.

This case alleges that the retailer relied on an employee to handle background screening even though that person admitted to having very little knowledge about relevant laws. Therefore, a jury could determine the defendant acted recklessly by providing a disclosure to applicants without first having it reviewed and approved.

What Employers Should Know

Employers everywhere should be aware of and prepared for compliance with the FCRA. When hiring, organizations must comply with this and other laws that are in effect wherever they operate. Failure to do so could result in repercussions such as a class action lawsuit.

Backgrounds Online provides sample compliance forms and educational resources. When you use our services, you can take advantage of our applicant self-submittal feature which asks the people you screen to read and sign compliance documents and submit their information directly to us after authorizing a screening. We also recommend consulting with counsel to ensure your hiring policies and compliance documents are correct and up to date.

Running Background Checks

If your organization is bringing on employees, contractors or volunteers, please contact us to discuss your background screening needs. Our experienced team can help you create customized packages that are ideal for any position. We are available to assist you Monday through Friday from 5am to 6pm PT.