When an employee applied for a position, she signed a disclosure form and authorization allowing the employer to perform a background check that could include looking into her credit history. The disclosure form included a waiver releasing the company from any liability resulting from the background check. After leaving the company a year later, she sued, saying that by including the liability waiver and other language on its disclosure form, the employer violated the Fair Credit Reporting Act’s (FCRA) standalone disclosure and authorization requirements. The trial court dismissed the case for failure to demonstrate a concrete injury in fact that would confer standing. On appeal, the dismissal was overturned, allowing the case to proceed.
WHY THIS IS IMPORTANT…the Massachusetts appeals court said the FCRA explicitly provides the ability to sue in state or federal court for any liability created by its provisions. Failure to provide the plaintiff with the disclosure required by the law, if proven, would establish liability. Even if her injury was not concrete, it is not speculative, remote, and indirect as a matter of state law. Employers should take heed and provide authorization forms that specifically comply with the law and not try to add protective provisions to them.
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