Class Action Lawsuit Filed Over Background Checks

Written By ESR News Blog Editor Thomas Ahearn

A class action lawsuit filed against Michaels Stores Inc. alleges the craft supply retailer “neglected to properly inform job applicants that the company regularly performed background checks on potential employees during the application process” in violation of state and federal consumer protection laws, according to a report from TopClassActions.com. The full story is at http://topclassactions.com/lawsuit-settlements/lawsuit-news/45583-michaels-hit-background-check-class-action-lawsuit/.

Top Class Actions reports the Plaintiff who filed the class action lawsuit claims Michaels allegedly violated the federal Fair Credit Reporting Act (FCRA) and the New Jersey Fair Credit Reporting Act (NJFCRA) by not providing proper disclosure of the background check procedure and did not tell job applicants that they run background checks as a part of the hiring process. The class action lawsuit claims a disclosure statement was placed at the end of job applications after other information.

The FCRA and NJFCRA require “that before procuring a consumer report for employment purposes a prospective employer must disclose that the employer may procure a consumer report for employment purposes in a document that ‘consists solely of the disclosure.’” By not clearly and properly displaying a stand-alone background check disclosure agreement, the class action lawsuit alleges Michaels did not fully comply with FCRA and NJFCRA statutes.

The class action lawsuit filed against Michaels claims: “Defendant’s conduct unambiguously violates the FCRA and NJFCRA. First, it is evident that a stand-alone disclosure cannot be part of a larger job application, but must be an entirely separate document. Second, it is evident that a stand-alone disclosure cannot contain anything other than the disclosure and an authorization for a consumer report to be procured.”

Top Class Actions reports the class action lawsuit proposes two Classes. The first would include individuals who applied to Michaels through an online application and on whom Michaels procured a background check for employment purposes in the period beginning two years prior to the filing of the Complaint and continuing through the date the class list is prepared.” The second would include New Jersey Class Members who applied for employment at Michaels and underwent a background check.

The Plaintiff is seeking an award of damages estimated at about $100 and $1000 for each FCRA and NJFCRA violation for Class Members of both proposed Classes. The class action lawsuit is Graham v. Michaels Stores Inc., Case No. 2:14-cv-07563, in the U.S. District Court for the District of New Jersey. The full text of the class action lawsuit is available at https://www.esrcheck.com/file/GRAHAM-vs-MICHAELS-STORES_Case2-14-cv-07563.pdf.

Class Action Lawsuit Information

Class action lawsuit filings for alleged FCRA violations will continue to increase even if no one is actually harmed in 2015. This is one of the trends on the Employment Screening Resources (ESR) 8th Annual ‘ESR Top Ten Background Check Trends for 2015’ selected by ESR founder and CEO Attorney Lester Rosen. For a list of background check trends, visit https://www.esrcheck.com/ESR-Top-Ten-Background-Check-Trends. For more blogs about class action lawsuit filings for FCRA violations, visit https://www.esrcheck.com/wordpress/tag/class-action-lawsuits/.

ESR CEO Lester Rosen to Present Top Ten Background Check Trends Webinar on January 21, 2015