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Entries in employment class action (2)

Tuesday
May192015

Claims Dismissed: Social Media Site's Reference Search Not a Background Check

Lawyer for EmployerEmployment Defense

 

by Nicole Kamm
818.907.3235

 

Good news for employers using social media to vet job applicants: A Federal District Court recently ruled the technology used in LinkedIn's Reference Search does not constitute a “consumer background check” of employees and job candidates.

Reference Search provides a list of coworkers or former coworkers of a particular LinkedIn member to potential employers paying for the service. Subscribers who use Reference Search are encouraged to send In-mail to the individuals on the list, presumably in an effort to find more information about the job seeker.

The plaintiff's in the lawsuit Sweet v. LinkedIn alleged LinkedIn’s search feature violated the Fair Credit Reporting Act (FCRA). The FCRA was enacted in 1970 to ensure consumer reporting agencies protect consumer privacy, and impart fair information.

Employers are entitled to conduct background checks, but under federal and state law must comply with several requirements, including obtaining written permission and making certain disclosures. They must also provide the reason(s) a candidate was not selected should something in the background check lead to an adverse decision in hiring or promotion.

Tracee Sweet and the members of her purported class contended they were passed over for jobs because of Reference Search results. She and three others sought to form a class on behalf of all LinkedIn members who had reports run on their professional backgrounds in the last two years through Reference Search.  

Plaintiffs alleged five violations of the FCRA:

1. LinkedIn is a consumer reporting agency, which failed to obtain required certifications.

2. LinkedIn does not verify or make reasonable efforts to verify, the identities of those using Reference Search, or the purpose for which those users are compiling reports.

3. The FCRA requires consumer reporting agencies to assure maximum possible accuracy of the information provided; LinkedIn failed to undertake any reasonable procedures to do so.

4. The FCRA requires agencies to provide a "Notice to Users of Consumer Reports", which includes a user's obligations to provide a notice to consumers when an adverse action is taken, in this case a refusal of employment. LinkedIn does not provide this Notice to Users.

5. Because LinkedIn provides information to users without inquiring into the users' purposes for obtaining the information, the social media site does not have reason to believe the users have permissible purposes as defined by FCRA.

The plaintiffs sought monetary damages, punitive damages, and attorneys' fees and costs. LinkedIn moved for dismissal, citing the plaintiffs' failure to state a claim, and prevailed.

The federal court judge held that:

1. The purpose of LinkedIn is for members to "share their professional identities online" – the information compiled through the site does not constitute a consumer report.

2. LinkedIn serves to "carry out consumers' information-sharing objectives", whereas a consumer reporting agency's purpose is to furnish information to third parties.

3. The information collected via Reference Search comes from the searcher's networks, not the employment candidate's networks.

4. LinkedIn does not market this information as reliable.

The plaintiffs may amend their complaint in future, so the case is not entirely put to rest yet. Arguably though, the information provided via Reference Search is not so different from the information an employer may glean by calling or emailing contacts s/he may already know at a candidate's former places of work.

Background Checks

For the moment, employers may continue to use social media websites as an informal type of background check without rising to the level of a “consumer reporting agency.” However, employers should only do so with caution. California employers are prohibited, under Labor Code §980, from:

1. Asking employees or prospective hires for usernames and passwords of their social media accounts;

2. Retaliating, by discharging, disciplining, or threatening job seekers or employees for refusing to provide their usernames and passwords;

3. Asking candidates or employees to log on to their personal accounts while in the presence of the employer, management, human resources representative, etc.

Employers using social media may also be at risk for discrimination claims though, should their findings result in hiring, firing or promotion decisions based on protected characteristics they may discover in search results.

For example, an employee who thinks s/he was passed over for a promotion because s/he Tweeted about personal medical conditions or political beliefs may allege Fair Employment and Housing violations.

Before Googling the next applicant or current employees, employers should consider the risks carefully and consult employment counsel.

Nicole Kamm is an Employment Defense Attorney. Contact her via email: nkamm@lewitthackman.com; or by phone: 818.907.3235

Monday
Aug252014

For Whom the Calls Toll: Employers May Be Responsible for Cell Reimbursements

Wage and Hour DefenseClass Action Defense

by Sue M. Bendavid

818.907.3220

 

Here's another case that may result in further liability exposure for employers in California. The California Second Appellate District Court ordered the trial court to reconsider class certification for a group of 1,500 customer service managers who used personal cell phones for work related calls.

In Colin Cochran v. Schwan's Home Service, Inc., the plaintiff sued his employer for reimbursement for his personal cell phone service. Cochran argued that Schwan's violated Labor Code Section 2802 and engaged in unfair business practices. He sued for declaratory relief and statutory penalties under the Private Attorneys-General Act (PAGA) for himself and on behalf of a putative class of fellow employees.

The trial court refused to certify the class, noting that if the class members did not incur losses (e.g., because they had plans with unlimited minutes) there could be no liability on a class wide basis.  The trial court ruled that “statistics from a survey could not be used to prove liability, especially because there was no pattern or practice regarding the expenditures of the class members."

The argument against class certification was that the commonality requirement could not be met since the class members have different cell service carriers and many different phone plans provided by those carriers – thus determining expenditures for individual class members would not be feasible via the statistical sampling method proposed by Cochran.

Additionally, Cochran's girlfriend may have paid for the plaintiff's cell service which may render the class representative's claims for damages irrelevant.

Employee Class Action – It's All About the Sampling

The Court of Appeals disagreed, and cited Brinker Restaurant Corp v. Superior Court 2012 in the opinion: "if the defendant's liability can be determined by facts common to all members of the class, a class will be certified even if the members must individually prove their damages."

The Appellate opinion also referenced Duran v. U.S. Bank National Assn. 2014, and stated the trial court should consider the principals of Duran in considering whether to allow statistical sampling evidence in establishing either liability or damages, noting:

Duran noted that the use of statistical sampling to prove liability in overtime class actions is controversial, and explained that the use of it to prove damage is less so because "the law tolerates more uncertainty with respect to damages than to the existence of liability."

The court's opinion also stated that the trial court erred in assuming an employee does not suffer a loss under §2802 if a third party pays for the employee's cell service. Essentially, it's not the employer's business to delve into how employees handle their own, personal business.

In conclusion, the Court stated:

We hold that when employees must use their personal cell phones for work-related calls, Labor Code §2802 requires the employer to reimburse them. Whether the employees have cell phone plans with unlimited minutes or limited minutes, the reimbursement owed is a reasonable percentage of their cell phone bills.

Employer Takeaway

Be careful if your employees use their personal cell phones for work related calls.

If possible, do not REQUIRE your employees to have a cell phone. If personal mobile devices are necessary, consider reimbursing your employees for calls and for part of the costs of service, even if that employee has an unlimited calling plan.

 

Sue M. Bendavid is the Chair of the Employment Practice Group at our firm. Contact her via email: sbendavid@lewitthackman.com, or via phone: 818.907.3220, for more information. 

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