Federal Court Approves Preliminary Settlement in Fair Credit Reporting Act Case

Company allegedly made employment decisions based on consumer reports without informing applicants of their rights or providing copies of the reports.

HUNTINGTON, West Virginia — ResCare, Inc., a home care, service provider and workforce contractor, has agreed to pay $840,000 to settle a class action lawsuit alleging the company violated the Fair Credit Reporting Act.

The lawsuit alleged ResCare obtained consumer reports about job applicants without their consent, and then made hiring decisions based on information in those reports without notifying the applicants, giving them a copy of the report and a Summary of Rights, or providing an opportunity to correct inaccurate information as required by FCRA.

Consumer reports are background checks that can include information from credit reports and criminal records. Companies that use consumer reports in hiring decisions are required by FCRA to follow a number of steps:

First, companies must provide written notice in a stand-alone format that information in a consumer report might be used to make employment decisions, along with written permission to get a consumer report.

Second, before rejecting an application or taking other employment-related action, companies must give the applicant or employee a notice that includes a copy of the report and a copy of A Summary of Your Rights Under the Fair Credit Reporting Act.

Finally, after rejecting an application or taking other adverse action, employers must provide notice and inform them of their right to see the information and correct any inaccurate information.

Plaintiff’s counsel include John W. Barrett and Jonathan R. Marshall of Bailey & Glasser LLP’s Charleston, West Virginia office; Matthew A. Dooley and Anthony R. Pecora of O’Toole McLaughlin Dooley & Pecora Co., LPA of Sheffield Village, Ohio; and Leonard A. Bennett of Consumer Litigation Associates, P.C., Newport News, Virginia.

Contact Form »