On May 5, 2016, a New York federal court approved the class action settlement in Jones v. Halstead Management Co. et al., No. 1:14-cv-03125-VEC, which will provide $583,375 to about 1,700 class members ($325 per class member). Halstead also made substantial changes to its practices as a result of the suit.
The lawsuit charged the Halstead entities with violating the Fair Credit Reporting Act – the federal law that regulates the commercial background screening industry – after the Legal Action Center’s client Kevin A. Jones lost a job as doorman with Halstead because a commercial background check conducted by Sterling Infosystems, Inc. mixed him up with a Kevin M. Jones. Legal Action Center with its co-counsel, Francis & Mailman, P.C., filed the lawsuit in the Southern District of New York in May 2014.
On September 3, 2015, after plaintiff moved to certify a class, the parties entered into a class action settlement addressing plaintiff’s claim that that the Halstead entities systematically failed to provide job applicants with a “stand-alone disclosure form” – a clear and conspicuous form consisting solely of the disclosure that a background check may be obtained for employment purposes. The law requires the form to be stand-alone (meaning that the form should not contain extraneous information) so that job applicants and employees understand that a background check might be run on them.
The court preliminarily approved the settlement on December 11, 2015. After a final approval hearing on May 5, 2016, the court issued a final approval order that found the class action settlement “fair, reasonable and adequate to members of the Class.” The court’s order certified a class of individuals whom, from May 1, 2012 through November 12, 2014, the Halstead entities obtained or caused to be obtained a consumer report for employment purposes using a written disclosure containing language substantially similar in form to the disclosure forms provided to Mr. Jones.
As part of the settlement, the Halstead entities acknowledged that they made changes to their FCRA practices by adopting new forms to comply with the stand-alone disclosure form requirement and engaging a new vendor to replace Sterling, the background check company responsible for the erroneous check on Mr. Jones.
“This is an excellent result for the Class,” said Monica Welby, Senior Staff Attorney at the Legal Action Center. “The law requires employers to provide job applicants with a stand-alone disclosure form so that applicants understand that a background check may be performed. The stand-alone form is particularly valuable for individuals with criminal records who often face an uphill battle when seeking employment. It is imperative for employers to comply with the Fair Credit Reporting Act so all individuals get a fair shot at employment.”
For more information about the lawsuit and settlement, click here.