At the end of June 2017, a California judge gave every indication that a Postmates $2.5 million deal would get the green light. The deal would end class allegations made against the on-demand delivery service. The suit was based on allegations that the Fair Credit Reporting Act was violated when Postmates did not notify 190,000 prospective couriers about their use of background checks.
The deal states that class members must object in writing before attending the final fairness hearing. The judge stated that he would allow class members to object at the final hearing whether they submitted a written objection or not. If the deal is approved, it would end the putative class action originally launched by lead plaintiff Lorretta Nesbitt in July 2015 based on allegations that the company purposefully violated the FCRA’s stand alone disclosure requirement when conducting credit checks for prospective drivers.
According to the lawsuit, Postmates’ required disclosure was hidden in the midst of a legal document that was 10 pages long and surrounded by extraneous information including a very verbose confidentiality agreement. Plaintiff argued that this presentation of the required disclosure did not fulfill legal requirement that it be clear, conspicuous, and in a stand-alone document.
Throughout the life of the case, Nesbitt amended the complaint, adding two additional lead plaintiffs and another putative class action claim with allegations that the company was also in violation of the FCRA’s pre-adverse action notice requirements which requires employers to inform their job applicants if they were to take any adverse action, such as not hiring them for the job at hand, as a result of information pulled in a background check. Employers are also required to provide the background checks to the individuals. According to the allegations in the suit, Postmates did not abide by these regulations.
Postmates continues to defend their practices stating that their disclosures comply with the law. But since the beginning of the suit, the company has made modifications to their disclosure documentations and both parties now agree that it is FCRA compliant.
If you have questions about the FCRA or if you fear you were unfairly treated during the job application process, please get in touch with one of the experienced California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.