Court Decision
Hodge v. Texaco Inc., U.S. Court of Appeals for the Fifth Circuit (975 F.2d 1093), Decided 1992
Decision: Workplace drug test reports are included under the Fair Credit Reporting Act (FCRA) since they bear on an individual’s personal characteristics and are used to determine his/her eligibility for employment. However:
- A drug testing lab report falls under the “transactions and experiences” exception and is not a “consumer report” under the FCRA; and
- A drug rehabilitation counselor’s report to the employer is excluded from coverage because he/she does not fit the definition of a “consumer reporting agency.”
Background: Hodge instituted a claim for violation of the notice and disclosure provisions of the FCRA after being discharged for failing a drug test required by his employer, Texaco.
The employee brought the action against his employer, the laboratory which issued the urinalysis report, and the drug rehabilitation counselor who assisted the employer in forwarding the employee’s sample to a laboratory and reporting the test results back to the employer.
The employee contended that the urinalysis report was a “consumer report” under the FCRA because it was used to determine his eligibility for employment, and that the laboratory and drug rehabilitation counselor were “consumer reporting agencies” which violated the FCRA by failing to use reasonable procedures to guarantee maximum possible accuracy in their “consumer reports.” The employee further contended that his employer violated the FCRA by failing to disclose the name and address of the drug testing laboratories when it terminated him.
The FCRA requires “consumer reporting agencies” to follow certain procedures when releasing “consumer reports” in order to ensure accuracy and to prevent unreasonable or careless invasion of consumer privacy. The term “consumer reporting agency” is defined by the FCRA as follows:
“… any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports.” (15 U.S.C. §1681a(f))
The FCRA defines a “consumer report” as follows:
“…any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer’s credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used … for the purpose of serving as a factor in establishing the consumer’s eligibility for … (2) employment purposes ….” (15 U.S.C. §1681a(d))
Court’s Opinion: Analyzing the applicability of the FCRA to drug test results, the United States Court of Appeals for the Fifth Circuit found that nothing in the FCRA precluded the coverage of medical-type reports such as urinalysis reports, since the FCRA’s coverage applied not only to credit reports, but also to other types of reports which have a bearing on a consumer’s employment eligibility, even though they do not directly relate to credit information.
The court concluded that workplace drug test reports are included under the FCRA, since they bear on an individual’s personal characteristics and are used to determine his/her eligibility for employment. As a result, agencies responsible for reporting such information are required to ensure their utmost accuracy.
The FCRA does, however, exclude from its coverage “any report containing information solely as to transactions or experiences between the consumer and the person making the report.” (§1681a(d)(A)) This exclusion exempts reports that are based solely upon the reporter’s first-hand experience with the subject.
The FCRA’s interpretative guidelines state that, as long as the report is not based on information from an outside source, but rather, solely on the reporter’s own first-hand investigation of the subject, the report will fall within this “transactions and experiences” exception.
The court found that the report generated by the laboratory fell under the “transactions and experiences” exception and was not a “consumer report” because the lab merely reported the results of its scientific testing of the employee’s urine sample.
It did not matter that the urine sample was first collected by another company, since the lab did not rely upon information provided by the collection source in producing its report, nor did it matter that the lab had no personal contact with the employee.
The court also found that the drug rehabilitation counselor’s report to the employer was excluded from coverage because he did not fit the definition of a “consumer reporting agency.”
The counselor’s only involvement with the drug test result was a one-time referral to the laboratory performing a confirmatory retest and a report to the employer confirming the positive test result, both of which arose out of his relationship with the employer at the time. The court held that in order to be considered a “consumer reporting agency,” an individual or organization must regularly engage in the collection of information; it is not enough that he engage in such activities on a casual, one-time basis. As a result, the court determined that the FCRA did not govern the counselor’s actions.
Based upon this case, any agency or individual that regularly engages in reporting drug test results to a third party may be subject to the FCRA, particularly when such reports are based upon more than first-hand knowledge and experience with the subject of the report. This means that the compliance procedures outlined in the FCRA must be followed.
Note that Congress amended the Fair Credit Reporting Act in October 1997 and November 1998, in part to expand an employer’s obligation to employees and prospective employees.
- A drug testing lab report falls under the “transactions and experiences” exception and is not a “consumer report” under the FCRA; and
- A drug rehabilitation counselor’s report to the employer is excluded from coverage because he/she does not fit the definition of a “consumer reporting agency.”
Background: Hodge instituted a claim for violation of the notice and disclosure provisions of the FCRA after being discharged for failing a drug test required by his employer, Texaco.
The employee brought the action against his employer, the laboratory which issued the urinalysis report, and the drug rehabilitation counselor who assisted the employer in forwarding the employee’s sample to a laboratory and reporting the test results back to the employer.
The employee contended that the urinalysis report was a “consumer report” under the FCRA because it was used to determine his eligibility for employment, and that the laboratory and drug rehabilitation counselor were “consumer reporting agencies” which violated the FCRA by failing to use reasonable procedures to guarantee maximum possible accuracy in their “consumer reports.” The employee further contended that his employer violated the FCRA by failing to disclose the name and address of the drug testing laboratories when it terminated him.
The FCRA requires “consumer reporting agencies” to follow certain procedures when releasing “consumer reports” in order to ensure accuracy and to prevent unreasonable or careless invasion of consumer privacy. The term “consumer reporting agency” is defined by the FCRA as follows:
“… any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports.” (15 U.S.C. §1681a(f))
The FCRA defines a “consumer report” as follows:
“…any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer’s credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used … for the purpose of serving as a factor in establishing the consumer’s eligibility for … (2) employment purposes ….” (15 U.S.C. §1681a(d))
Court’s Opinion: Analyzing the applicability of the FCRA to drug test results, the United States Court of Appeals for the Fifth Circuit found that nothing in the FCRA precluded the coverage of medical-type reports such as urinalysis reports, since the FCRA’s coverage applied not only to credit reports, but also to other types of reports which have a bearing on a consumer’s employment eligibility, even though they do not directly relate to credit information.
The court concluded that workplace drug test reports are included under the FCRA, since they bear on an individual’s personal characteristics and are used to determine his/her eligibility for employment. As a result, agencies responsible for reporting such information are required to ensure their utmost accuracy.
The FCRA does, however, exclude from its coverage “any report containing information solely as to transactions or experiences between the consumer and the person making the report.” (§1681a(d)(A)) This exclusion exempts reports that are based solely upon the reporter’s first-hand experience with the subject.
The FCRA’s interpretative guidelines state that, as long as the report is not based on information from an outside source, but rather, solely on the reporter’s own first-hand investigation of the subject, the report will fall within this “transactions and experiences” exception.
The court found that the report generated by the laboratory fell under the “transactions and experiences” exception and was not a “consumer report” because the lab merely reported the results of its scientific testing of the employee’s urine sample.
It did not matter that the urine sample was first collected by another company, since the lab did not rely upon information provided by the collection source in producing its report, nor did it matter that the lab had no personal contact with the employee.
The court also found that the drug rehabilitation counselor’s report to the employer was excluded from coverage because he did not fit the definition of a “consumer reporting agency.”
The counselor’s only involvement with the drug test result was a one-time referral to the laboratory performing a confirmatory retest and a report to the employer confirming the positive test result, both of which arose out of his relationship with the employer at the time. The court held that in order to be considered a “consumer reporting agency,” an individual or organization must regularly engage in the collection of information; it is not enough that he engage in such activities on a casual, one-time basis. As a result, the court determined that the FCRA did not govern the counselor’s actions.
Based upon this case, any agency or individual that regularly engages in reporting drug test results to a third party may be subject to the FCRA, particularly when such reports are based upon more than first-hand knowledge and experience with the subject of the report. This means that the compliance procedures outlined in the FCRA must be followed.
Note that Congress amended the Fair Credit Reporting Act in October 1997 and November 1998, in part to expand an employer’s obligation to employees and prospective employees.
Twaddle v. RKE Trucking Co., U.S. District Court for the Southern District of Ohio (11 WH Cases 886), Decided March 29, 2006
Decision: Under the Fair Labor Standard Act (FLSA), trucking companies must compensate drivers for time spent submitting to random drug tests.
Background: Five drivers for an Ohio trucking company brought suit against their employer for failure to compensate them for time spent:
- Reporting early to work,
- Attending company meetings, and
- Submitting to random drug tests.
Court’s Opinion: The U.S. District Court for the Southern District of Ohio found that RKE Trucking violated the FLSA by failing to compensate drivers for time spent submitting to random drug tests. The company did not dispute this finding, and summary judgment was granted.
Background: Five drivers for an Ohio trucking company brought suit against their employer for failure to compensate them for time spent:
- Reporting early to work,
- Attending company meetings, and
- Submitting to random drug tests.
Court’s Opinion: The U.S. District Court for the Southern District of Ohio found that RKE Trucking violated the FLSA by failing to compensate drivers for time spent submitting to random drug tests. The company did not dispute this finding, and summary judgment was granted.
Hammons v. Norfolk Southern Corp., U.S. Sixth Circuit Court of Appeals (Case No. 97-3465), Decided October 2, 1998
Decision: A federal action can be maintained against a private employer if it can be shown that the employer’s policy (in this case, concerning drug testing) violated the individual’s constitutional right and was attributable to the federal government (in this case, the federal drug testing regulations).
Background: On June 15, 1990, Hammons was subjected to a random urine drug screen pursuant to Norfolk's company policy and the Federal Railroad Administration’s Control of Alcohol and Drug Use Regulations in 49 CFR Part 219. He tested positive for marijuana and was suspended from service. A new urine sample was provided by Hammons, which tested negative for drugs. Because the results of the second drug screen were negative, Norfolk's Director of Medical Services notified Hammons that he would be returned to service. However, the letter also warned Hammons that "[s]hould any future test be positive, you will be subject to dismissal." Thereafter, Hammons was allegedly subjected to approximately twenty-four random drug screens during the next year and a half.
In 1992, Hammons' urine sample tested positive for cocaine and he was discharged from service for failure to comply with company policy and the terms of the agreement. Hammons brought the matter to court, alleging that by testing him for drugs in violation of 49 CFR § 219.601, “Railroad Random Drug Testing Programs,” Norfolk violated his right under the Fourth Amendment to be free of unreasonable searches and seizures.
The employer moved to dismiss the claim on the grounds that a Fourth Amendment claim cannot be brought against a private employer.
Court’s Opinion: The court disagreed with the employer. It held that a federal action can be maintained against a private employer if it can be shown that the employer’s policy violated the individual’s constitutional right and was attributable to the federal government.
This case was viewed as opening the door for individuals to pursue private actions for violations of DOT testing regulations. For example, an individual who is terminated after testing positive in a DOT-mandated drug test that did not comply with the procedural regulations can now arguably sue his employer in federal court for a violation of the Fourth Amendment.
This concern should be at least somewhat alleviated, however, by the court’s subsequent decision in Parry v. Mohawk Motors of Michigan, 236 F.3d 299 (6th Cir. 2000), where it specifically held that the Omnibus Transportation Employee Testing Act does not create a private right of action for alleged violations of 49 CFR Part 40.
Edwards v. United Parcel Service, U.S. District Court for the Western District of Kentucky (163 LRRM 2116), Decided 1999
Decision: The court refused to set aside the decision of an arbitration panel upholding the termination of a pilot for adulterating a urine specimen.
Background: Courtney Edwards was employed as a pilot for United Parcel Service for about six years before his termination. Edwards was randomly selected for a Federal Aviation Administration (FAA) drug test.
UPS terminated the pilot after a lab detected the presence of glutaraldehyde in the urine specimen he provided in connection with the FAA-mandated drug test. Glutaraldehyde is an adulterating agent, not found naturally in urine, that masks the detection of drugs in a urine sample. It is found in certain products marketed for the purpose of producing false results in drug testing.
Edwards brought the case before an arbitration panel which upheld the termination.
Court’s Opinion: The court found the pilot’s conduct constituted a refusal to submit to testing and did not overturn the arbitration panel’s decision upholding Edwards’ termination for adulterating a urine specimen.
Twaddle v. RKE Trucking Co., U.S. District Court for the Southern District of Ohio (11 WH Cases 886), Decided March 29, 2006
Decision: Under the Fair Labor Standard Act (FLSA), trucking companies must compensate drivers for time spent submitting to random drug tests.
Background: Five drivers for an Ohio trucking company brought suit against their employer for failure to compensate them for time spent:
- Reporting early to work,
- Attending company meetings, and
- Submitting to random drug tests.
Court’s Opinion: The U.S. District Court for the Southern District of Ohio found that RKE Trucking violated the FLSA by failing to compensate drivers for time spent submitting to random drug tests. The company did not dispute this finding, and summary judgment was granted.
Hammons v. Norfolk Southern Corp., U.S. Sixth Circuit Court of Appeals (Case No. 97-3465), Decided October 2, 1998
Decision: A federal action can be maintained against a private employer if it can be shown that the employer’s policy (in this case, concerning drug testing) violated the individual’s constitutional right and was attributable to the federal government (in this case, the federal drug testing regulations).
Background: On June 15, 1990, Hammons was subjected to a random urine drug screen pursuant to Norfolk's company policy and the Federal Railroad Administration’s Control of Alcohol and Drug Use Regulations in 49 CFR Part 219. He tested positive for marijuana and was suspended from service. A new urine sample was provided by Hammons, which tested negative for drugs. Because the results of the second drug screen were negative, Norfolk's Director of Medical Services notified Hammons that he would be returned to service. However, the letter also warned Hammons that "[s]hould any future test be positive, you will be subject to dismissal." Thereafter, Hammons was allegedly subjected to approximately twenty-four random drug screens during the next year and a half.
In 1992, Hammons' urine sample tested positive for cocaine and he was discharged from service for failure to comply with company policy and the terms of the agreement. Hammons brought the matter to court, alleging that by testing him for drugs in violation of 49 CFR § 219.601, “Railroad Random Drug Testing Programs,” Norfolk violated his right under the Fourth Amendment to be free of unreasonable searches and seizures.
The employer moved to dismiss the claim on the grounds that a Fourth Amendment claim cannot be brought against a private employer.
Court’s Opinion: The court disagreed with the employer. It held that a federal action can be maintained against a private employer if it can be shown that the employer’s policy violated the individual’s constitutional right and was attributable to the federal government.
This case was viewed as opening the door for individuals to pursue private actions for violations of DOT testing regulations. For example, an individual who is terminated after testing positive in a DOT-mandated drug test that did not comply with the procedural regulations can now arguably sue his employer in federal court for a violation of the Fourth Amendment.
This concern should be at least somewhat alleviated, however, by the court’s subsequent decision in Parry v. Mohawk Motors of Michigan, 236 F.3d 299 (6th Cir. 2000), where it specifically held that the Omnibus Transportation Employee Testing Act does not create a private right of action for alleged violations of 49 CFR Part 40.
Edwards v. United Parcel Service, U.S. District Court for the Western District of Kentucky (163 LRRM 2116), Decided 1999
Decision: The court refused to set aside the decision of an arbitration panel upholding the termination of a pilot for adulterating a urine specimen.
Background: Courtney Edwards was employed as a pilot for United Parcel Service for about six years before his termination. Edwards was randomly selected for a Federal Aviation Administration (FAA) drug test.
UPS terminated the pilot after a lab detected the presence of glutaraldehyde in the urine specimen he provided in connection with the FAA-mandated drug test. Glutaraldehyde is an adulterating agent, not found naturally in urine, that masks the detection of drugs in a urine sample. It is found in certain products marketed for the purpose of producing false results in drug testing.
Edwards brought the case before an arbitration panel which upheld the termination.
Court’s Opinion: The court found the pilot’s conduct constituted a refusal to submit to testing and did not overturn the arbitration panel’s decision upholding Edwards’ termination for adulterating a urine specimen.