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Starbucks Facing a Potential Class-Action Suit for Alleged FCRA Violations

By Michael Klazema on 10/29/2017
Starbucks is facing a potential class-action lawsuit over alleged violations of the Fair Credit Reporting Act. Per a report from Law360.com, the coffee chain is the defendant in a proposed class-action suit filed in Georgia on September 21. The lawsuit states that Starbucks failed to execute its employee background check policies in accordance with FCRA guidance.

The lawsuit claims that Starbucks used background check findings to disqualify candidates from job consideration but did not provide the rejected candidates copies of relevant background check reports or inform them of their rights under the FCRA. If true, this practice is not compliant with the FCRA.

According to the FCRA, if an employer wishes to disqualify a candidate based on background check findings, it must first:

· Notify the candidate about the adverse hiring decision
· Provide the candidate with a free copy of the background check report that led to the decision
· Give the candidate the name and contact information of the company that prepared the background check report
· Tell the candidate that the background check company did not make any hiring decisions
· Inform the candidate that he or she has the right to request a second free copy of the background check report within 62 days
· Notify the candidate that he or she can dispute any inaccuracies in the background check report with the company that prepared the report.

The lawsuit against Starbucks accuses the company of failing to follow these steps in a fashion that satisfies the requirements of the FCRA.

Per coverage, the lead plaintiff in the case is Kevin Wills, who applied for a position with a Starbucks store in Buford, Georgia in the fall of 2015. Starbucks offered Wills the position pending the completion of a criminal background check. After Wills completed the background check, the manager at the Buford Starbucks store rescinded his employment offer without warning.

It wasn’t until several days after his job offer was rescinded that Wills received a copy of his background check report. The document was a background check report for “Kevin Willis”—a misspelling of Wills’ actual name. Wills’ background check had returned the record of Kevin W. Willis from the state of Minnesota. While Wills’ record is clean, Willis’s wasn’t. The background check report included two felony convictions for domestic violence—convictions that Wills claims cost him his job opportunity with Starbucks.

The lawsuit alleges that while Starbucks and their background check company did furnish Wills with a copy of his background check report, they did so too late in the process. Wills and his attorneys argue that Starbucks would have had to provide the background check report before taking adverse action to comply with the FCRA. According to the lawsuit, the delay—as well as Starbucks’ failure to notify Wills of his rights under the FCRA—meant the Wills was unable to dispute the inaccurate details of the background check.

The FCRA stipulates that employers must provide a candidate with a copy of his or her background check at least five business days before taking adverse action. Alongside the background check report, employers must provide candidates with a copy of “Summary of Your Rights Under the Fair Credit Reporting Act,” a document prepared by the Consumer Financial Protection Bureau.

Reports note that Wills and his lawyers are seeking to certify a nationwide class of individuals who claim to have had similar issues with the Starbucks hiring process since September 20, 2015. The lawsuit seeks between $100 and $1,000 in damages per violation.

Starbucks has denied the allegations and stated that its background check and hiring policies are 100% FCRA compliant.

Sources: https://www.law360.com/hospitality/articles/966598/starbucks-background-checks-violate-fcra-suit-says

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