Wyndham Class Action: Background Checks Don’t Comply With FCRA

A class action lawsuit filed against Wyndham Vacation Ownership Inc. alleges that the company uses consumer report information on prospective and current employees to make employment-related decisions, without providing those reports to the person involved or following other procedures required by federal law.

“While the use of consumer report information for employment purposes is not per se unlawful,” the class action notes. “It is subject to strict disclosure and authorization requirements” under the Fair Credit Reporting Act (FCRA).

The FCRA requires employers to: 1) get authorization from an employee or job applicant before getting a consumer report of that person; 2) give a copy of the consumer report to the affected person before the employer can use information from the report as part of an adverse employment action; and 3) provide a notice of rights to the affected person, including where the consumer report came from and that the consumer has the right to dispute the report.

The complaint cites federal regulatory guidance that “[e]mployers must comply with this provision even where the information contained in the report (such as a criminal record) would automatically disqualify the individual from employment or lead to an adverse employment action.”

The complaint asserts that Wyndham uses background check information as part of its standard screening process, and that it purchases this background information from “outside consumer reporting firms.”

That background information from third parties constitutes consumer report information, the class action argues.

By using that information against its employees and job applicants without providing the reports to them, Wyndham “willfully violated [FCRA] requirements in systemic violation” of the rights of all employees and job applicants, according to the complaint.

Plaintiff I.P. is one of those allegedly affected by Wyndham’s unlawful employment practices.

I.P. states that he was offered a job with Wyndham on June 21, 2016. On July 13, 2016, Wyndham informed I.P that it was performing a background check.

Wyndham then immediately terminated I.P.’s employment as a result of that background check, according to the complaint.

I.P claims that “[a]lthough Defendant provided Plaintiff with a copy of the consumer report that it relied upon, Plaintiff, in violation of the FCRA, was deprived of any opportunity to review the information in the report and discuss it with his employer before [he] was terminated.”

The FCRA lawsuit requests certification of a Class of all Wyndham Vacation Ownership Inc. employees and job applicants in the U.S. who Wyndham used information from a credit report against, and were not provided “the proper pre-adverse notice as required by the FCRA.”

The class action seeks statutory damages of “not less than one hundred dollars ($100) and not more than one thousand dollars ($1,000)” for each violation of the FCRA, and back pay for I.P.

Under federal law, the complaint also requests punitive damages from Wyndham.

I.P is represented by Brandon J. Hill of Wenzel Fenton Cabassa, P.A.

The Wyndham Background Check Class Action Lawsuit is I.P. v. Wyndham Vacation Ownership Inc., Case No. 6:16-cv-01795, in the U.S. District Court for the Middle District of Florida, Orlando Division.