While not directly related to the business of collections, executives at agencies that require credit checks as part of the hiring process would do well to look at a decision released earlier this month by the Ninth Circuit Court of Appeals.
The case, Syed v. M-I, LLC, centers around the disclosure that was presented to the individual seeking employment, the plaintiff in this case. Because the disclosure did not explicitly follow the language included in the Fair Credit Reporting Act, the Ninth Circuit has ruled that the defendant’s use of the disclosure form was a “willful violation” of the FCRA.
The FCRA states that the disclosure must be made solely, meaning without any other disclosures or language. In this case, the disclosure was part of a “pre-employment disclosure release.”
From a legal brief about the ruling:
This decision serves as another example of why all employers should take a close look at the pre-employment disclosure forms. What may appear to be a minor wording variation from the disclosure language stated in the FCRA could result in a class action lawsuit, and one that at least some courts – including now any Court in the Ninth Circuit – could declare to be a willful violation.