Whole Foods Fights Background Check Lawsuit
Sometimes violations of federal law aren’t blatant. In late 2014, Colin Speer, a former Whole Foods employee in Florida, filed a lawsuit against the company for allegedly failing to comply with FCRA standards regarding background checks. Speer claims that Whole Foods obtained his consumer report, but he was notified of this fact in a document that also contained a release of liability. According to the law, consent for the procurement of consumer reports must be “clear and conspicuous,” so any FCRA-protected documentation requires a stand-alone disclosure form in order to obtain that information. Combining a disclosure form with a release of liability or any other document is illegal.
The FCRA (Fair Credit Reporting Act) went into effect in 1970 and serves to protect personal information (i.e. credit reports). Businesses cannot obtain a consumer report just because they have an individual’s information, and they can’t use the information they obtain however they want even if an individual provides consent. If a company wants to procure a consumer report as part of a job application or requirement, that company must provide a singular disclosure to the applicant or employee for that purpose. That individual must consent to the check, and if a job candidate loses an employment opportunity as a result of information in his/her consumer reports, the discerning company must notify that candidate in writing as to its reasoning.
Whole Foods claims that they did not violate FCRA standards, but small adjustments in documentation that do not appear “clear and conspicuous” to a prospective or current employee can have severe consequences as a result of lawsuits like the one filed by Speers. Companies have and will continue to lose millions of dollars to this type of litigation, not to mention the time spent inundated in court battles on both sides. City and state laws regarding background checks further complicate a shady business dealing, especially if a company is working with a third-party screening firm that is working under laws in a separate state. Not having a piece of paper, or even a phrase on that paper, in complete accordance with the law can result in a logistical nightmare for everyone involved.
Though the law on FCRA standards for the procurement and use of an indivdual’s confidential information is clear, not every employer complies, and they’ll keep paying for it until they do. Whole Foods is just one of many companies embroiled in an unnecessary struggle.