| ENACTED LEGISLATION |
| IOWA: Iowa amends drug testing law |
Summary: Iowa's drug testing statute, Iowa Code Section 730.5, has been revised, with the changes becoming effective on July 1, 2018. The amendment will allow employers to take action based on an alcohol test result of .02 grams of alcohol per two hundred ten liters of breath. Prior to this amendment, employers could not take action for alcohol test results below .04 BAC.
The law was previously amended on July 1, 2017, to clarify that hair follicle testing is only permitted for pre-employment drug testing.
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| Impact(s): Iowa employers |
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| MASSACHUSETTS: New limits imposed on criminal history inquiries |
Summary: A provision in the recently signed Massachusetts criminal justice reform law amends the state's restrictions on the questions employers may ask a job applicant regarding the applicant's criminal history during the hiring process. The changes are effective Oct. 13, 2018. Existing law already prohibits employers from asking about arrests that did not result in a conviction and certain first offenses (drunkenness, simple assault, speeding, minor traffic violations, affray, or disturbance of the peace).
The new amendment adds two additional restrictions. First, the law adjusts the time frames related to when an employer may seek information on a misdemeanor conviction. The new law states that employers may not ask for information about misdemeanor convictions (or incarcerations resulting therefrom) that occurred three or more years prior to the date of the employment application, unless the person has been convicted of any offense within the preceding three years. This has been reduced from the preceding five-year period. Second, the law prohibits employers from asking applicants for information about a criminal record that has been sealed or expunged.
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| Impact(s): Massachusetts employers |
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| PROPOSED LEGISLATION |
| CALIFORNIA: Proposed bills prohibit certain state agencies from denying professional licenses based on non-violent criminal history |
Summary: California Assembly Members have proposed the following bills to provide qualified individuals who receive job-specific training while incarcerated the necessary professional licenses needed to obtain employment with various state agencies.
- AB 2138 will prohibit the Department of Consumer Affairs from denying or revoking licenses under its issuing authority unless the conviction is directly related to the functions of the profession the applicant wishes to pursue. The bill will also require license issuing boards to collect and publish demographic data regarding licenses that the board denies. AB 2138 will not affect licenses issued under the Bureau of Cannabis Control, which falls under the Department of Consumer Affairs but is a new bureau and has far more complicated licensing regulations.
- AB 3039 will enact similar provisions for all licenses issued by the Department of Social Services (DSS), to ensure all Californians are able to access employment in community care facilities. This bill will apply to all licenses issued under DSS with the exception of licenses related to foster care.
- AB 2293 will similarly affect licenses as the previous two bills but will apply to EMS licenses issued by the Emergency Medical Services Authority.
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| Impact(s): California employers |
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| CONNECTICUT: House passes bill banning salary history questions |
| Summary: HB 5386 would prohibit an employer from inquiring or obtaining information about a prospective employee's wage and salary history until an offer of employment with compensation has been made. A prospective employee may voluntarily provide salary history, however. The bill is now in the Senate. |
| Impact(s): Connecticut employers |
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| COURT OPINIONS |
| U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA: Settlement reached in FCRA class action against employer |
| Summary: Plaintiffs have asked a California federal judge for preliminary approval of a $2.4 million settlement to end a proposed FCRA class action alleging that a nationwide employer violated the FCRA's stand-alone disclosure requirement. Plaintiffs allege that the employer's disclosure form included extraneous agreements and certifications related to applicants' willingness to have their information photocopied and an oath that answers on a background questionnaire were correct. According to the filing, two mediation sessions resulted in an agreed-upon gross settlement amount of $62.87 for each of the approximately 37,174 class members. |
| Impact(s): FCRA compliance – for general legal review |
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| U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS: Employer defeats FCRA action under Spokeo standing requirement |
| Summary: A plaintiff alleged that an employer denied him a job based on a background check without the appropriate adverse action process. Specifically, plaintiff alleged that the employer failed to properly provide pre-adverse and adverse action notices by, in part, omitting a copy of the background check used in making the decision to deny employment. The employer moved to dismiss the suit, arguing that plaintiff lacked standing, in part because no inaccuracies existed in the report. Looking to SCOTUS' decision in Spokeo, the Northern District of Illinois agreed. The court found that bare procedural violations – like those presented in Spokeo – simply did not give rise to Constitutional standing. |
| Impact(s): FCRA compliance – for general legal review |
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| U.S. DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK: Employer settles suit challenging background screening policy for $3.75M |
Summary: A nationwide retailer will give hiring preference to some of the more than 41,000 applicants it previously denied jobs to because of their criminal histories and will pay nearly $3.75 million as part of a deal ending a proposed Title VII class suit challenging its background screening policy. The plaintiffs alleged that the employer's criminal record screening policies had a disparate impact on African-American and Latino job applicants for store positions. No court ruled against the employer, nor has the company admitted any liability. Plaintiffs moved the Southern District of New York to approve the deal, which also requires the employer to hire two experts in the field of industrial and organizational psychology to design, develop and implement properly validated adjudication guidelines for the hiring of job applicants with criminal histories for hourly, nonexempt jobs. The deal also requires the employer to give $600,000 to nonprofits that help the formerly incarcerated find work.
Under the agreement, the employer will offer openings to the estimated 41,000 class members before other applicants, and it will waive its initial screening interview for workers qualified for supervisory jobs. If there are no hourly jobs available within 20 miles of a class member, they will be offered the first job that becomes available for 12 months after the court approves the settlement. Applicants whose criminal histories disqualify them under the revised hiring criteria or other reasons will not be paid. Class members who are not hired for certain other reasons, including already having jobs, being retired or having a disability, will be paid a portion of a $1.2 million cash pool, with individual awards capped at $1,000.
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| Impact(s): Background screening compliance – for general legal review |
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| U.S. DISTRICT COURT FOR THE SOUTHERN DISTRICT OF OHIO: Employer's motion for summary judgment granted in FCRA adverse action case |
| Summary: A federal district court rejected a plaintiff's argument that an employer's use of a "Not Clear for Hire" adjudication status at the pre-adverse action stage indicated a final adverse action, concluding that the employer showed that it had only made a preliminary determination of employment eligibility and that the job remained open and available to the plaintiff throughout the dispute process. |
| Impact(s): FCRA compliance – for general legal review |
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| U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA: Federal court dismisses FCRA negligent violation claims based on failure to allege actual damages |
| Summary: A data security company convinced a California federal judge to toss most of a proposed class action targeting its employee background check process, saying a former company employee did not show he suffered actual harm from being given improper authorization forms (plaintiff had alleged that the form included the consumer reporting agency's privacy policy). The court granted the employer's motion to dismiss the plaintiff's claim that it negligently violated the FCRA's stand-alone disclosure requirement, noting that only actual damages, as opposed to statutory damages, are available for FCRA violations that are based on negligence. Since the plaintiff acknowledged during the case that he suffered no actual damages, the judge said his claim must be dismissed insofar as it alleged a negligent violation, but the judge kept alive the plaintiff's willful violation claims. |
| Impact(s): FCRA compliance – for general legal review |
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| SUPERIOR COURT FOR THE STATE OF WASHINGTON: Settlement reached in FCRA disclosure form action |
| Summary: A national employer has agreed to pay $2.5 million to settle a lawsuit alleging it violated the FCRA by including extraneous information in its disclosure form. The class includes approximately 113,839 class members (including 1,510 who are entitled to auto-pay). |
| Impact(s): FCRA compliance – for general legal review |
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| NEVADA: Court denies employer's motion to dismiss wrongful termination case for use of medical marijuana |
Summary: A nurse who was fired from his job at a hospital in Las Vegas last year after marijuana was found in his system has won a preliminary victory in his wrongful termination case. A state court rejected the hospital's motion to dismiss the former employee's lawsuit. The plaintiff was hired at Sunrise in 2009 and ended up working in the behavioral health unit. According to his lawsuit, he was attacked by a patient in 2013 and fractured his vertebrae, which led to him applying for and receiving a medical marijuana card. In February 2017, Plaintiff was again attacked by a patient and treated for injuries at an emergency room, where he was asked to provide a urine sample. After the sample tested positive for marijuana, the hospital told him in early March that he was suspected of working while impaired in violation of company policy. Plaintiff argued that marijuana shows up in tests as long as a month after the substance is ingested and maintains that he was not under the influence while working.
His lawsuit argues the termination was a violation of Nevada's medical marijuana law and the Legislature's direction that employers make reasonable accommodations for marijuana cardholders. It also alleges the hospital was negligent in hiring and training and discriminated against someone lawfully using marijuana.
The Nevada law at issue in this case provides that an employer must "attempt to make reasonable accommodations for the medical needs of an [employee who is a registered patient] provided that such reasonable accommodation would not: (a) Pose a threat of harm or danger to persons or property or impose an undue hardship on the employer; or (b) Prohibit the employee from fulfilling any and all of his or her job responsibilities."
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| Impact(s): Drug screening compliance – for general legal review |
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| OTHER UPDATES |
| FAIR CREDIT REPORTING ACT: Motion for settlement filed in class action alleging FCRA disclosure form violation |
| Summary: Two applicants who filed a proposed FCRA class action against a pet store have asked a California federal judge to preliminarily approve a $1.2 million settlement with the retailer. Most of the estimated 37,279 class members will receive approximately $20 each, but members of the adverse action subclass – 52 individuals whom the retailer decided not to hire after receiving their consumer report – will receive $150 each. The underlying case centered on the standalone disclosure requirement, with the applicants alleging that the disclosure form was 30 paragraphs of fine print that would fill almost five single-spaced pages when reproduced in normal format and contained "reams of extraneous information beyond the required consumer report disclosure."
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| Impact(s): FCRA compliance – for general legal review |
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| FEDERAL DEPOSIT INSURANCE CORPORATION: The FDIC will move to electronic fingerprinting for background checks |
Summary: The FDIC has issued a letter stating that it is moving to electronic fingerprinting to facilitate background checks performed in connection with applications and notices submitted to the FDIC, including: applications for federal deposit insurance, notices of acquisition of control, requests for participation in the banking industry by individuals with certain criminal convictions, and notices to replace board members or senior management in certain institutions.
The FDIC stated that it will begin using the new process during the second quarter of 2018. Individuals will have access to more than 1,000 collections sites across 50 states, the District of Columbia, Puerto Rico and the Virgin Islands. The fingerprinting technology will automatically rate the quality of the fingerprints, improving the efficiency and effectiveness of the fingerprinting background check process.
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| Impact(s): Employers subject to FDIC requirements |
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