American supermarket chain Publix Super Markets, Inc. has agreed to pay $6.8 million in a class action lawsuit over its hiring practices. The plaintiffs allege that Publix violated the Fair Credit Reporting Act (FCRA), which requires employers to notify job applicants when background checks are performed.
The lawsuit’s lead plaintiff Erin Knights applied for a job at his local Publix store in Hendersonville, Tennessee in 2013 using a kiosk. The lawsuit claims that Publix obtained a background check on Knights but violated the FCRA by failing to provide him with a notification consisting solely of the disclosure.
The lawsuit also alleges that Publix used manipulative wording in its job applications to waive applicants’ legal rights of background checks. Under the FCRA, employers who obtain background checks on job applicants and employees must follow certain criteria to remain legal and compliant. Employers who fail to follow these rules could be subject to both litigation, such as the case of Knights vs Publix. See below for a list of key rules associated with the Fair Credit Reporting Act.
Get written permission from job applicant or employee stating that the employer has his or her permission to obtain a background check.
Inform the job applicant or employee that the background check may be used for decisions regarding their employment. This can not be achieved through the application; it must come in the form of a written, stand-alone notification.
Certify compliance to the background check company.
Provide the job applicant or employee with a copy of the background report and A Summary of Your Rights Under the Fair Credit Reporting Act.
If adverse action is taken as a result of the background check, the employer must provide an adverse action notice to the job applicant or employee.
So, how much money can eligible class members expect to receive from the settlement? According to the Publix Fair Credit Reporting Act Settlement website, payments of $48.55 were mailed in November 2014 to all 90,633 people class members who did not exclude themselves from the settlement. The website also states that settlement checks must be cashed on or before May 25, 2015.
While Publix has since agreed to pay the $6.8 million settlement, it adamantly denies any wrongdoing. The Florida-based supermarket chain says it agreed to pay “because of the substantial expense of litigation… and the disruption to its business operations.” Publix also said it has revised its applications and use of employment screening services on job applicants.
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