At the request of the Senate Appropriations Committee, the Federal Trade Commission (FTC) submitted a report to Congress updating lawmakers on its efforts to educate consumers about their rights to dispute and correct errors in their credit reports. According to the report, the two main ways the FTC promotes credit report accuracy are education and enforcement. The FTC educates consumers and businesses by posting various resources online. On the enforcement side, the report states, the FTC has brought more than 30 actions in the last decade enforcing the Fair Credit Reporting Act (FCRA) against consumer reporting agencies, users, and furnishers. Approximately half of those cases involved allegations related to processes for handling consumer disputes of inaccurate information or procedures for ensuring the accuracy of information in consumer reports.

Click here to access the FTC report entitled Efforts to Promote Consumer Report Accuracy and Disputes.

In an important decision for employers that conduct background checks, on April 24, 2020, the U.S. Court of Appeals for the Ninth Circuit affirmed a summary judgment in favor of the employer in the case of Leonard Luna v. Hansen and Adkins Auto Transport, Inc.  The Court of Appeals held that an employer does not violate the Fair Credit Reporting Act (FCRA) by (i) providing a job applicant the disclosure at the same time as other employment materials; and (ii) failing to place the authorization in a standalone document.

FCRA Disclosure and Authorization

At issue was the FCRA required disclosure and authorization that employers must provide job applicants when conducting a background check through a third-party background screening company.  Plaintiff filed a class action alleging that the employer’s hiring process violated the FCRA’s disclosure and authorization requirements by presenting the disclosure together with other employment application materials. The FCRA requires that employers provide a “clear and conspicuous disclosure,” in writing, in a document “that consists solely of the disclosure” that a background check may be conducted AND the applicant authorizes such background check in writing.  The FCRA specifically states that the authorization may be combined with the disclosure. (FCRA § 604(b)(2)(A)(i) and (ii)).

Takeaways

The Court of Appeals made two important points relevant to the legal requirements placed on employers when conducting background checks.

  1. The plaintiff in the case took issue with the employer’s practice of providing employees with the disclosure at the same time as, but as a separate document from, other employment documents.  The Court of Appeals held that while Section 604(b)(2)(A)(i) of the FCRA requires that a disclosure be in “a document that consists solely of the disclosure,” no authority suggests that a disclosure must be distinct in time from other documents, as well.  Thus, an employer does not violate the FCRA by presenting a standalone FCRA disclosure form contemporaneously with other employment application materials.
  2. The Court of Appeals also addressed the plaintiff’s argument that the employer violated the FCRA by failing to put its authorization in a standalone document. The Court noted that while Section 604(b)(2)(A)(i) of the FCRA requires that the disclosure be in a standalone document, Section 604(b)(2)(A)(ii) of the FCRA only requires that the authorization be “in writing,” without specifying its format.

Conclusion

The Court of Appeals affirms that “an employer does not violate the Fair Credit Reporting Act by providing a FCRA disclosure with other employment materials, and by failing to place a FCRA authorization on a standalone document.” To read the opinion click here.  Therefore, as is permissible under the FCRA, an employer may combine the disclosure and the authorization into one document when presenting such to job applicants prior to conducting a background check.  And, the disclosure and authorization may be presented to job applicants along with other employment application materials.

Yesterday the White House released Trump’s Proclamation restricting immigration to the United States. Highlights include:

  • It suspends the entry into the United States of new permanent residents, which ban will last for at least 60 days.
  • The suspension applies only to those outside the United States who do not have an immigrant visa, impacting those seeking entry as permanent residents under the diversity visa program as well as employment- and family-based categories.
  • It does not apply to anyone seeking entry as a non-immigrant and it does not appear to apply to those with a pending application for lawful permanent resident status with U.S. Citizenship and Immigration Services.
  • Exceptions include for those seeking entry on (i) an immigrant visa as a healthcare professional, researcher, or related to COVID-19; and (ii) EB-5 investors.  There are additional exceptions not listed here.
  • The Proclamation is effective at 11:59 pm on 4/23/2020.

To be watched as this language is worrisome.  Section 6 of the Proclamation states, “Within 30 days of the effective date of this proclamation, the Secretary of Labor and the Secretary of Homeland Security, in consultation with the Secretary of State, shall review nonimmigrant programs and shall recommend to me other measures appropriate to stimulate the United States economy and ensure the prioritization, hiring, and employment of United States workers.” (emphasis added)

On Monday President Trump tweeted “In light of the attack from the Invisible Enemy, as well as the need to protect the jobs of our GREAT American Citizens, I will be signing an Executive Order to temporarily suspend immigration into the United States!” (Tweet at 10:06 pm on 4/20/20) In a tweet today, Trump stated, “I will be signing my Executive Order prohibiting immigration into our Country today.” (Tweet at 7:00 am on 4/22/20)

Important — at least from what Trump said at his daily briefing, this is not a complete shut down or suspension of immigration to the United States; notwithstanding that U.S. embassies and consulates abroad are closed as well as offices of the U.S. Citizenship and Immigration Services (USCIS) offering services to the public.  Those are closed due to COVID-19 precautions.

Since he has not yet signed an Executive Order, for now, this is what we know about it:

  • What it does — pauses permanent residency applications for 60 days (i.e., green cards).
    • At the end of the 60 days Trump stated that he and a “group of people” will reevaluate “based on economic conditions at the time” to determine whether to lift or modify the suspension.  It is unknown what those “economic conditions” are.
    • Individuals with a pending application for adjustment of status in the United States, or applying for permanent residence from abroad, should expect to be impacted and their applications being placed “on hold” for at least 60 days.
  • What it does NOT do — it does not shut down all immigration in/to the United States. For example, it does not appear to impact individuals:
    • Entering or working in the United States on a temporary basis such as H-1B professionals, L-1 intracompany transferees, or E-2 investors.
    • Entering or studying in F-1 student status.
    • Currently working In the United States with a work permit or on the basis of a temporary non-immigrant visa.
    • With pending applications for work authorization or non-immigrant change or extensions of status that are pending with USCIS.

Stay tuned as this blog will be updated once the Executive Order is released.

 

As the coronavirus pandemic continues to spread across the United States, business owners and HR professionals are dealing with multiple workforce issues related to COVID-19. Below guidance and resources seek to shed some light on the Paycheck Protection Program, addresses how to complete the Form I-9 if your new hire is “remote” due to COVID-19 precautions, and  how to address the situation of an employee testing positive for coronavirus.

  • My colleague Tenley Carp wrote a alert called “What Every Small Business Needs to Know About the CARES Act,” focusing on the Paycheck Protection Program and loans available through private lenders and funded by the government. The loan forgiveness program applies to companies employing 500 or less employees and the money can be used for payroll, rent, utilities. Click here to read her alert.
  • Speaking of the CARES Act and the Paycheck Protection Program, are you looking for the application for borrowersClick here for the application and click here to learn more about the program.  The Paycheck Protection Program provides small businesses with funds to pay up to 8 weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent and utilities.
  • Are you hiring and wondering how to complete the Form I-9 when your office or worksite is closed due to a state or local order related to COVID-19 and your workforce is working remotely from home.  The government still expects businesses to comply with the Form I-9 and E-Verify requirements (if you are an E-Verify company) and these must be completed within three business days of hire.  But, how do you comply with the requirement to visually inspect the document(s) presented by the individual for Section 2 of the Form I-9 when your company is taking COVID-19 precautions and HR and the new hire are in different locations?  The Department of Homeland Security is offering a reprieve to the legal requirement that an employer visually inspect the documents (i.e., the “in-person” requirement). Click here to read an alert I posted on this topic.
  • Finally, my colleagues Ashley Kelly, Henry Perlowski and Ed Cadagin wrote this alert on how a business can respond in this scenario–“Mike from accounting just texted me. He’s not coming in today because he’s tested positive for coronavirus. What do we do?How would your company respond in such a situation?  Click here for guidance.

As the coronavirus (COVID-19) changes employers’ on-boarding processes, here are the latest developments to ensure your company is complying with both the employment eligibility verification form (the “Form I-9”) requirements and E-Verify during remote on-boarding.  Below guidance is provided by the Department of Homeland Security (DHS), specifically U.S. Citizenship and Immigration Services (USCIS) and Immigration and Customs Enforcement (ICE).

  • The in-person requirement for the Form I-9 is temporarily suspended if your company is closed or taking other precautions due to COVID-19.  The general rule is that an employer must undertake a physical inspection of the document(s) presented by the employee for section 2 purposes.  However–in light of COVID-19–the government is suspending the in-person and physical inspection of the document(s) presented by the employee when completing the Form I-9. During this time, an employer can view the document(s) presented by the employee via Zoom or Skype, for example. However, employers will need to view the document(s) at a later date and note the physical inspection of the document(s) on the Form I-9.  This is a limited exception to the general rule. IMPORTANT — employers are still required to complete the Form I-9 within three business days of hire.  The “remote verification” exception is only intended to accommodate the realities of remote on-boarding in the current COVID-19 world.
    • Click here for details as to how your company must comply to benefit from this guidance, both now and in the future (when normal operations resume).
  • An employer must still create a case in E-Verify within three business days from the date of hire, and employers must use the hire date from the employee’s Form I-9 when creating the E-Verify case. However, if case creation is delayed due to COVID-19 precautions, select “Other” from the drop-down list and enter “COVID-19” as the specific reason.
  • E-Verify is extending the timeframe to take action to resolve Social Security Administration (SSA) Tentative Nonconfirmations (TNCs) due to SSA office closures to the public. E-Verify is also extending the timeframe to take action to resolve DHS TNCs in limited circumstances when an employee cannot resolve a TNC due to public or private office closures.
  • All local Social Security offices are closed to the public for in-person services. Meaning, employees will not be able to apply for/receive a Social Security Number (SSN) during this time period.  If you are an E-Verify employer, this will mean the employee cannot provide their SSN in section 1 and you will need to suspend creation of a case in E-Verify until such time as you have the employee’s SSN.
  • ICE announced that, effective March 19, 2020, any employer who was served a Notice of Inspection (NOI) during the month of March 2020 and who has not already responded will be granted an automatic extension for 60 days from the effective date. At the end of the 60-day extension period, DHS will determine if an additional extension will be granted.
    • Many employers found that during March 2020 ICE engaged in enforcement operations, issuing NOIs to employers nationwide.

I will continue to monitor I-9 and E-Verify guidance issued by DHS and related to COVID-19.  It will be posted to this blog.  If you have any questions, please contact me at montserrat.miller@agg.com.  I hope you stay healthy and symptom-free.

Due to the coronavirus, U.S. Citizenship and Immigration Services (USCIS) offices are closed to the public.

USCIS has suspended routine in-person services until at least April 1, 2020 to help slow the spread of Coronavirus Disease 2019 (COVID-19). USCIS staff will continue to perform duties that do not involve contact with the public. This means that the service centers will continue to process nonimmigrant petitions such as H1B and L petitions.  It also means that the H1B random lottery will take place later this month.  However, for those individuals with an interview appointment notice, a biometrics appointment, or a naturalization ceremony, those are cancelled for the time being. To read more, click here.

USCIS will send notices with instructions to applicants and petitioners with scheduled interview appointments or naturalization ceremonies impacted by this closure. They will automatically be rescheduled once normal operations resume. Individuals who had InfoPass appointments with a Field Office must reschedule through the USCIS Contact Center (click here).

Last night, March 11, 2020, President Trump announced a travel ban impacting Europeans traveling to the United States. The ban applies to those “physically present” within the Schengen Area during the 14-day period preceding their entry into the United States.  The President, in his speech last night, said the ban would last 30 days. But the proclamation does not say that, it says only that it shall remain in effect until terminated by the President.

As a general rule the travel ban announced last night by President Trump suspends travel for nonimmigrants (e.g., Es, Hs, Ls) for those “physically present” in countries in the Schengen Area (see country list below). The ban does not apply to lawful permanent residents, immediate family members of U.S. citizens and certain other individuals.

The President’s proclamation banning travel to the United States goes into effect at midnight this Friday (March 13, 2020)

Here is a link to the Department of Homeland Security announcement (click hereand here is a link to the Presidential Proclamation (click here).

Schengen Area: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and Switzerland.

 

Now that the United Kingdom is (finally) exiting the European Union (EU) one question U.S. based companies have is what happens to transfers of personal data from the United Kingdom (UK) to the United States under the EU’s General Data Protection Regulation (GDPR). The International Trade Administration’s (ITA) Privacy Shield Team recently put out guidance to address this question.

Good news is that Privacy Shield participants may rely on the EU-U.S. Privacy Shield Framework to receive personal data from the UK even though they are withdrawing from the EU. That is because EU law will continue to apply during the transition period from January 31, 2020 to December 31, 2020.

After the transition period–starting in 2021–a Privacy Shield organization must update its public commitment to comply with Privacy Shield to include the UK.  Meaning, organizations must update their public facing privacy policy on their website to include certain language covering the UK.  Model language is provided by the ITA (click here). And of course, in order to receive personal data from either the EU or the UK, an organization must be Privacy Shield certified.

A new version of the employment eligibility verification form, known as the Form I-9, is about to be published.  Once it is, employers must use the new version (with a version date of 10/21/2019) and phase out use of the prior version within 90 days.  Use of the revised form by all employers completing the Form I-9 is mandatory after the 90 day window.

All employers must complete a Form I-9 for new hires within three days of hire. After completion, employers must maintain the Form I-9 for the duration of the employee’s employment with the company.  Upon termination, the forms must be retained for three years after hire or one year after termination, whichever is later.  Click here to read more on retention of the Form I-9 post termination.  Employers must use the current version of the Form I-9 as instructed by U.S. Citizenship and Immigration Services.

The new Form I-9 will have a revision date of 10/21/2019 in the bottom left hand corner of the form.  Employers will be allowed to use the prior version for 90 days after publication in the Federal Register.  There are no substantive changes to the paper Form I-9, however there are two country additions to the “fillable” Form I-9 that USCIS offers employers on its website. There are changes to the Form I-9 instructions, including clarifications to who an authorized representative is and updates to the process to request the paper Form I-9.

To view the Federal Register notice click here or click here.