Company Accused of Violating Fair Credit Reporting Act Compliance

When hiring employees, companies need to make sure they comply with the Fair Credit Reporting act with regard to background checks or face costly legal consequences to their business. In recent news, Wegmans Food Markets, a grocery store chain based in the Rochester, NY area, was accused by two former employees of violating the Fair Credit Reporting Act. The class action lawsuit represents any employees or applicants to the chain in the past five years.

The Fair Credit Reporting Act requires businesses to follow a number of procedures to legally obtain a background check for prospective or current employees. Employers need to get written permission from employees, disclose in writing the intention and purpose of obtaining the report, and if the company declines to hire you or lets you go based on the information in the report, give the applicant a copy of the report. Employees may then contest the credit report, important as credit reports sometimes contain errors.

The former employees claim Wegmans allegedly violated the act in the following ways:

•  Their online authorization form did not make it obvious they could obtain a consumer report.
• They didn’t properly disclose on a separate document that the background checks would be conducted.
• The plaintiffs believe they were legally misled by the company and had their privacy invaded.

In response, Wegmans asserts that they properly followed Fair Credit Reporting Act rules with their employees.

The Wegmans case shows the importance of using a compliant firm for your background checks. We stay up to date on laws such as the Fair Credit Reporting Act, making sure you follow procedures and get the necessary information while avoiding legal trouble. Contact us about our record and services.