Employee Background Checks Raised Privacy Concerns

On appeal to the Court of Appeals for the Ninth Circuit, a district court's denial of a preliminary injunction was reversed and remanded because contractor employees challenging government background check requirements were likely to succeed on the merits of their informational privacy claims, the background investigations would result in irreparable harm, and the balance of hardships favored the employees. The government modified the contract to operate the Jet Propulsion Laboratory to require "low-risk" contractor employees to submit to in-depth background checks that asked whether in the past year they had "used, possessed, supplied, or manufactured illegal drugs," and if so, to provide information regarding "any treatment or counseling received" for drug abuse. Forms to be filled out by personal references asked the references to disclose "any adverse information" about the employees. The contractor's employees challenged the background questionnaire and examination, contending the investigations violated the Administrative Procedure Act, their constitutional right to informational privacy, and the Fourth Amendment's prohibition of unreasonable searches. The district court denied the employees' request for a preliminary injunction, finding the employees were unlikely to succeed on the merits, failed to demonstrate irreparable harm, and would not prevail in a balance of hardships. After vacating its prior ruling (52 CCF ¶78,876), the Ninth Circuit agreed with the district court's conclusion the background investigations complied with the APA, finding the investigations were authorized by the Space Act of 1958. The court also affirmed the district court's conclusion the investigations were unlikely to be considered "searches" within the meaning of the Fourth Amendment.

However, the district court erred in finding the employees were not likely to succeed on their constitutional informational privacy claim. Although the questions regarding past involvement with illegal drugs passed constitutional scrutiny, the requirements for employees to disclose "any treatment or counseling received" for drug abuse, and for personal references to provide "any adverse information" about the employees, were not narrowly tailored to further a legitimate government interest. Furthermore, the district court erred in judging the harm to the employees and in weighing the balance of hardships. The contractor's policy of deeming employees who did not complete the questionnaire to have voluntarily resigned would cause the employees irreparable harm because there was no adequate remedy for improperly denying their employment. Constitutional violations cannot be adequately remedied through damages, and the emotional damage resulting from loss of employment cannot be compensated by mere back payment of wages. The relative lack of harm to the government weighed in favor of granting the preliminary injunction. (Nelson., et al. v. NASA, CA-9, 52 CCF ¶78,957)

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