For years, the Communications Decency Act (“CDA”), 47 U.S.C. § 230(c) (2012), has been this mythical talisman which almost all website owners have uttered much like a priest regurgitates liturgical scripture while waving their digital accouterments of the faith when it comes to liability for its users. And for years, firms such as Facebook, Google, Apple, and other tech companies have used Section 230 much like a shield deployed during the Crusades. And to be quite clear, companies such as Epic Games, the creator of the online game Fortnite, or Microsoft Office 365 which provides Software as a Service (SaaS) for the office operate with the specific intent of providing a standalone platform that encourages communal participation without any type of dogma. The lines get blurred, though, when it comes to platforms whom encourage the same; however, infer that referrals of a for profit nature are sacrosanct based only upon the fact that they appear on their websites.
A duty to warn is a concept that arises in the law of torts in a number of circumstances, indicating that a party will be held liable for injuries caused to another, where the party had the opportunity to warn the other of a hazard and failed to do so.
The duty to warn arises in product liability cases, as manufacturers can be held liable for injuries caused by their products if the product causes an injury to a consumer and the manufacturer fails to supply adequate warnings about the risks of using the product (such as side effects from pharmacy prescriptions) or if they fail to supply adequate instructions for the proper use of the product (such as a precaution to use safety glasses when using a drill). If the manufacturer fails to supply these warnings, the law will consider the product itself to be defective. A lawsuit by a party injured by a product, where the manufacturer failed to properly warn, is usually brought as a “negligence” action, but it could be filed as a “strict liability” claim or as a “breach of warranty of merchantability” case.
The Mortgage Field Services Industry has five primary software platforms which allow the Client to communicate the work order to the Vendor — Software as a Service (SaaS). Foreclosurepedia has opted not to name all of them as only two were willing to speak with us. SaaS is egalitarian in nature; SaaS preaches no dogma nor does it have an incentive to do more or less than the data fed into it. Many firms today, including the five providing SaaS for work orders in our Industry, are incorporating the ability to recruit. And while many may find this as a boon due to the minuscule volume at hand, the reality is that it is potentially a piece of liability which imperils both the provider and recipient. This process also has another term — a Job Board. The biggest foreseeable problem with what is taking place is that both the poster of the job as well as the software provider have profit as their motive. The poster’s profit driven motive is self evident whereas the software provider’s motive is to generate more fees to process the work orders.
Liability for discrimination may arise in the way that employers advertise job openings. It is always best to have formal procedures relating to the posting of jobs. In Greenspan v. Automobile Club of Michigan, a class of female plaintiffs successfully sued the Automobile Club of Michigan, demonstrating that the way that the club advertised its job postings had a disparate impact on women. The club would informally advertise jobs through its managers and the decision to hire would be up to manager discretion, as opposed to set job qualifications. The plaintiffs in the case were able to show that because most of the managers in the company were male, men would only inform other men about job openings and only men would be hired as opposed to more qualified women. An employer’s reliance on word-of-mouth recruitment by a certain group could violate the law if the employer continues to hire people from that certain group (i.e. a certain religious, racial or ethnic group) without others knowing about the open jobs.
It is not simply the job posting which plays a role. The actions of the software providers, in our Industry, only allow an internal, closed network of advertisers which conveys a level of trust attributed to the posters themselves. Additionally, when for profit relationships are created which include the third parties capitalized upon — the software provider gains the profit from more work order billing and the job poster benefits from the Labor provided — there is a certain level to which a duty to warn exists. A duty to warn is a concept that arises in the law of torts in a number of circumstances, indicating that a party will be held liable for injuries caused to another, where the party had the opportunity to warn the other of a hazard and failed to do so. For example, does the software provider have a duty to warn a customer about irregularities of the job poster such as financial insolubility; — previous bankruptcies, lateness in paying bills to the software provider, etc. — a lack of current billable coverage in the areas of recruitment; non payment of licensing, insurance, or wages; or perhaps sanctioning by municipal, county, state or federal governments?
Companies buy liability insurance based upon what they do because it protects them from the unforeseen. The problem with that insurance is that it is based only, in part, upon what the insurance provider is advised about their line of business and also upon the disclaimers which are read by the consumers.
Field Service Technicians and Inspectors have had the multi-billion dollar responsibility of insuring against liability for decades — General Liability, Errors & Omissions, Workman’s Comp, the list goes on and on. The very same corporations which continue to underpay, cut pay, and refuse to pay have skated on their moral, if not legal, responsibilities to protect the very Labor which lines their pockets. The aphorism of the road to hell is paved with good intentions is a classic case-in-point when it comes to businesses attempting to playing both sides of the profit coin. And for better or worse what it ultimately all boils down to in a for profit setting, is that there is a greater responsibility at play and a heightened attachment of liability as opposed to, say, a non profit or state unemployment office operating a Job Board.
Using Foreclosurepedia as an example, we discontinued the posting of non vetted employment opportunities. We found that the risk of exposing Labor to non payment or unsafe working conditions far outweighed the potential for a $3 inspection. Today, other than firms that we have financially stress tested, we do not publish job openings. We have additionally discontinued our Job Board due to similar risk aversion.
There is no simple answer to what a company should or should not do when it comes to protecting Labor in a Job Board setting. On the other hand, is it necessary that all entities vet the advertiser, themselves? In the case of media organizations, probably not. The Wall Street Journal had this to say on the subject,
Floyd Abrams, a well-known First Amendment lawyer at Cahill Gordon, says the law generally protects publications from liability for running fraudulent ads. “Society cannot ask, and the courts will not ask, of newspapers that they do the equivalent of investigative journalism to check out the bona fides of their advertisers,” he says. Abrams added that publications are hesitant to vet their ads, or at least tell readers they do, because “if they fail to identify the fraudulent ad, they might be in more trouble than if they hadn’t started down that road in the first place.”
The problem is that the companies we are talking about today are not primarily engaged in journalism. In fact, the only borderline case we found was the National Association of Mortgage Field Services (NAMFS) which is a non profit business league. And while for decades there have been hundreds — if not thousands — of complaints against NAMFS members, we are unaware of any litigation against NAMFS itself. More on point, though, when we look at the typical large job recruiting sites like Glassdoor, they even have a page on fraudulent job postings which states, in part,
Do not give out personal or financial account information to a new employer via email or messaging service.
Now, there is a real irony as every job posting available in the Industry immediately requires a name, address, phone, social security number, date of birth, driver’s license number, bank account number, bank account routing number — you get the point. So, for the low, low price of a few dollars, anyone could create an account with any of these Industry companies and begin advertising to simply pull all of this personally identifiable information for fraudulent purposes — enabled only as a direct result of the software provider — or hire and never pay the applicant, once again, only as a direct result of the software provider. And while none within the management of the Industry may believe that protecting the rights of Labor are their responsibility, the reality is it is not simply fraud that is of grave concern. Drug cartels and terrorists are constantly evolving in their sophistication of how they obtain innocent victim’s information to use in the furtherance of criminal activity.
The reality is that our Industry is at least 40 years behind resembling any semblance of legality. Millions of dollars have been paid out to settle employee misclassification claims, millions more have been taken from Labor through extortion via spurious chargebacks, and even more claims have never seen the light of day due to mergers and acquisitions. In the largest of all ironies, COVID has become the great equalizer in that the level of Labor attrition the Industry has reached historic highs just at the time the Industry needs Labor the most. For many Foreclosurepedia did exit interviews with, there is no amount of restructuring which could ever make things whole again — it is simply a bridge too far.
