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If employment background errors cost you a job opportunity, reputational or career damage, or lead to a deactivation or other harm, or if you dispute the errors and your dispute is ignored or mishandled, you may be able to sue for violations of your consumer rights under the Fair Credit Reporting Act (FCRA). Potential compensation from a successful lawsuit can include lost wages, emotional distress damages, attorney’s fees, and other available remedies.
What Is an Employment Background Check Error?
An employment background check error is inaccurate, incomplete, false, outdated, mixed, or unreportable information in a background report that may affect decisions involving hiring, firing, promotions, required clearances, and other employment-related issues.
Can You Sue for a Background Check Mistake?
Generally - yes. You can sue for a background check mistake when an employer or consumer reporting agency (CRA) violates your rights or their obligations under the FCRA.
For example, you may have a claim if:
- A background report contains false information
- An employer fails to provide required notices before taking adverse action
- A background screening company fails to correct verified errors
- A job offer is withdrawn because of inaccurate reporting
When Do Background Check Errors Become Illegal?
While the term “illegal” is not typically used in this context, background check errors become unlawful when they result from violations of the Fair Credit Reporting Act (FCRA). The FCRA requires CRAs to use reasonable procedures to ensure maximum possible accuracy.
Potential violations include:
- Reporting false or expunged criminal records
- Failing to investigate disputes or correct errors
- Using outdated or incomplete information
What Laws Protect You from Background Check Errors?
The primary law that protects you from background check errors is the Fair Credit Reporting Act (FCRA) - requiring reasonable procedures to ensure maximum possible accuracy. Depending on where you live, state laws may provide additional protections and remedies.
Who Can Be Held Liable for an Incorrect Background Check?
The parties, who can be held liable for incorrect background checks, depend on how the error occurred.
A consumer reporting agency may be responsible if it reports false information or fails to conduct a reasonable investigation after receiving a dispute.
An employer may also be liable if it:
- Fails to provide required FCRA notices
- Takes adverse action before allowing time to dispute
- Does not follow the required hiring process
A data furnisher may be responsible if it reports inaccurate or outdated information.
Request a copy of your report as soon as you learn it affected a hiring decision. It is much easier to identify errors while the hiring process is still active.
What Damages Can You Recover in a Background Check Lawsuit?
The damages you can recover in a background check lawsuit depends on the circumstances. A successful claim may include compensation for:
- Lost wages and other financial harm
- Lost employment opportunities
- Emotional distress
- Statutory damages
- Attorney’s fees and court costs
- Reputational or career harm
What Should You Do If Your Background Check Is Wrong?
If your background check is wrong you should file a dispute with the screening company that prepared the report. Request a copy of your report and compare it with your records to identify erroneous information.
Here’s how to file a dispute:
- Review your report for errors
- Gather documents that support your position
- File a dispute (through certified mail)
- Notify the employer if the report affected your application
- Seek help from a background check attorney
Employers often rely on the information they receive unless you notify them of an error.
How Do You Prove a Background Check Error Case?
You prove a background check error case by presenting strong documentation to support your dispute.
Helpful evidence includes:
- The background report, with errors clearly marked
- Job offers or rejection letters or other communication related to employment decisions based on your background check
- Adverse action notices
- Correspondence and mail receipts related to filing a dispute
- Court records, motor vehicle reports, and other documents showing the reported information was incorrect
- Employment, education, or other records that verify the correct information
Showing both the error and the harm it caused can strengthen your case.
How Long Do You Have to File a Lawsuit for a Background Check Error?
Generally, you have two years from the date you discover a Fair Credit Reporting Act (FCRA) violation to file a lawsuit, but no more than five years from the date the violation occurred. Because deadlines vary depending on the facts of your case, it’s important to speak with an attorney as soon as possible to protect your rights.
How Much Is a Background Check Error Lawsuit Worth?
The value of a background check error lawsuit varies depending on the facts of the case. In some situations, consumers may recover actual damages, such as lost wages, lost job opportunities, and compensation for emotional distress.
If the violation was willful, the FCRA also allows for statutory damages of $100 to $1,000 per violation, punitive damages in appropriate cases, and attorney’s fees and costs.
Do You Need a Lawyer for a Background Check Error Claim?
You do not necessarily need a lawyer for a background check error claim (or for any legal claim), but there is typically real value in working with a lawyer, especially depending on the unique facts of your case.
Legal representation from a lawyer experienced in handling these types of claims can be beneficial because an attorney can help determine whether the FCRA was violated, build a peresonalized legal strategy based on your facts and the relevant laws, anticipate common defensive postures, negotiate with parties, and pursue compensation.
In addition, the time, labor, costs, and burden of assessing, compiling, filing, negotiating, and litigating a successful case are the responsibility of your lawyer, relieving you of the related stress.
What Is the Process for Filing a Background Check Lawsuit?
Depending on the nature of the error and the harm, the process for filing a background check lawsuit may start with identifying the errors, gathering supporting documents, and filing a dispute letter. If the issue is not resolved through your dispute, the process may proceed to a lawsuit, followed by settlement negotiations or trial.
In some cases, the dispute itself is not a necessary first step and your attorney may have legal grounds to file a lawsuit immediately.
How Can a Consumer Protection Lawyer Help You?
A consumer protection lawyer can help you by understanding the process, the tactics used to avoid compliance with FCRA obligations, and the pitfalls at various stages, and by relieving you of burdens and getting you money when the law permits. They can also communicate with employers and background screening companies, negotiate settlements, and represent you in court.
When Should You Contact an Attorney About a Background Check Error?
You should contact an attorney about a background check error when you learn that inaccurate information caused you harm, such as negatively affecting your employment, job application, career or reputation, or finances. You should also contact a lawyer if you have filed a dispute that was ignored or mishandled, or if the errors are repeated in new reports.
Frequently Asked Questions
Can I sue if I was denied a job due to a background check error?
Likely. If an FCRA violation or reporting errors caused you to lose a job opportunity, you may have grounds to file a lawsuit.
Can I sue both the employer and the background check company?
In most cases, no. While liability ultimately depends on who violated the law (FCRA), the responsibility for reporting accurate information falls on the screening company that produced the report. Employers may sometimes be sued for certain FCRA violations regarding failure to give proper notice.
Are background check lawsuits worth it?
It depends on the facts of your case, the damages you suffered, and whether and how the FCRA was violated. An attorney can help determine whether a lawsuit would be “worth it” for your specific circumstances.
How much compensation can I get for a background check error?
Compensation varies based on the harm caused and the specific legal claims involved.
How long does it take to fix a background check mistake?
Under the FCRA, reporting companies typically have 30 days from the date of receipt to investigate a dispute and correct errors. However, not adhering to this legally obligated timeline is often an additional violation.
Can I still get hired after a background check error is corrected?
Yes, but it is entirely up to the employer whether or not they want to reconsider you for the position once the incorrect information is removed or corrected. There is no legal obligation to do so.
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