Most employers understand the importance of compliance with the federal Fair Credit Reporting Act (FCRA) as it applies to background checks and applicant records. However, employers also must recognize the interplay of state law restrictions on the use of background checks in the application and employment process.

Recently, a federal district court in Pennsylvania granted summary judgment in favor of an employer who withdrew an offer of employment after that employer found a discrepancy between background check records and information reported directly by the applicant to the company. McCorkle v. Schenker Logistics, Inc., MDPA, 1:13-cv-03077, October 8, 2014. 

Dustin McCorkle made application to a transportation logistics company in Central Pennsylvania. As part of the application process, McCorkle was asked to provide a 10-year criminal background history, and was informed that any information provided would be checked against a background check done by a third-party provider. The company’s policy states that “True misrepresentations of facts [on the application], confirmed through the background check, may disqualify an applicant from future consideration of employment.”

McCorkle provided information regarding a stalking/harassment conviction related to a custody issue, but mentioned no other convictions. He then signed the application, which included this language:

I understand and agree that any false, misleading, or incomplete information given in my application, interview(s), or other pre-employment questionnaires and procedure, regardless of when discovered by the Company will be sufficient basis for my disqualification for employment or, if already employed by the Company, the termination of my employment with the Company.

The application also required McCorkle to read and sign the following statement:

I agree that the Company shall not be liable in any respect if I am not hired or if my employment is terminated as a result of providing such false, misleading or incomplete information.

Following McCorkle’s application, the company obtained a background check that included various other misdemeanor and summary convictions, none of which were reported to them by McCorkle on his application. Based on that fact, the company withdrew the offer of employment. McCorkle filed a lawsuit against the company, alleging violation of Pennsylvania’s Criminal History Record Information Act (CHRIA). 

The CHRIA sets out the parameters for an employer’s use of criminal background check information, and specifically states that “[f]elony and misdemeanor convictions may be considered by the employer only to the extent to which they relate to the applicant’s suitability for employment in the position for which he has applied.” CHRIA prohibits employers from making hiring decisions based on criminal convictions that are unrelated to an applicant’s suitability for a particular job.

While McCorkle alleged that the company violated the CHRIA by withdrawing its offer of employment, the district court found that it was McCorkle’s misrepresentation and incomplete reporting of his criminal background that caused that withdrawal and that the “disqualification was not based on Plaintiff’s criminal history record information.” Therefore, no violation of CHRIA existed.

This holding was supported by the wording of the company’s policy and application form, both of which spelled out in unambiguous language the fact that the company would not hire or continue to employ an individual who misrepresented information. Without that language, which was quoted heavily in the court’s opinion, it is unclear as to whether the result would have been the same.