Convictions. Given the procedural safeguards in the criminal justice system, the Guidance states that “a record of a conviction will usually serve as sufficient evidence that a person engaged in particular conduct.” The caveats are that there may be evidence of an error in the record, an outdated record, or some other reason for not relying on the fact of the conviction. A database could, for example, continue to report a conviction that was later expunged or one for a felony that was later downgraded to a misdemeanor.
In deciding whether a policy has a disparate impact, the EEOC will examine the text, associated documentation, and information about how the policy was implemented. It will consider which offenses were reported to the employer; whether convictions, arrests, charges, or other criminal incidents were reported; how far back in time the reports reached; and the jobs for which background screening was conducted. Whether the employer has a reputation for excluding people with criminal records will be examined, and training documents used by the employer will be relevant in this inquiry. Finally, although the EEOC takes the position that national data regarding the disparate impact of criminal record exclusions affords a basis for investigating a disparate impact charge against an employer, it will give the employer an opportunity to exonerate itself by showing that African-Americans and Hispanics are not arrested or convicted at disproportionately higher rates in its geographic area.
The EEOC asserts that an employer is more likely to objectively assess the relevance of a conviction if it learns of that fact after it knows the applicant’s qualifications. Accordingly, the Guidance recommends that employers not ask about convictions on applications and that, if and when an inquiry is made, it be limited to convictions for which exclusion would be consistent with business necessity. Employers will meet this standard if they: (1) validate the criminal conduct screen per Uniform Guidelines on Employee Selection Procedures standards or (2) develop a targeted screen considering the nature of the crime, time elapsed, and nature of the job and individually assess people excluded by the screen.
Regarding the nature of the crime, an employer should consider the harm it caused, the legal elements involved, and whether it was a felony or misdemeanor. As for the time elapsed, while permanent bans for any offense are not consistent with business necessity, only a case-by-case determination that might involve studies on how much the risk of recidivism declines over time can determine whether the duration of an exclusion will be sufficiently tailored to satisfy the business necessity standard. Regarding the nature of the job sought, employers should identify the essential functions of the job, the level of interaction with co-workers and others, the environment in which the job duties will be performed, and the amount of oversight involved.
Concerns about the Guidance. No sooner had the Guidance appeared than interest groups began protesting it. The main complaint is that it puts employers in a Catch-22: If employers adhere to its strictures and do not use criminal history information in at least some instances, they risk losses from employee theft and fraud and in a negligent hiring claim. As well, some states mandate criminal background checks for certain positions. But if employers ignore the Guidance, they risk being challenged for disparate treatment or impact by the EEOC and, down the road, a hefty damage award or settlement.
The EEOC maintains that its Guidance does not reflect any change in its fundamental positions on criminal record exclusions but only discusses disparate treatment and impact more fully, gives examples of both forms of discrimination, and better explains how the EEOC analyzes the “job related and consistent with business necessity” standard for criminal record exclusions.
In one of its most controversial sections, the Guidance provides that federal laws that restrict employing people with certain records afford a defense to a Title VII claim but that state and local laws are preempted if they permit any act that would be unlawful under Title VII. Thus, an employer adopting an exclusionary policy to comply with state or local law is not shielded from liability if the policy does not meet the job-related standard.
The U.S. Commission on Civil Rights heard from stakeholders on December 7, 2012. A Society for Human Resource Management spokesperson stated that the Guidance “places employers between a rock and a hard place” in that they could lose their license and/or be open to liability if they do not comply with state or local laws mandating criminal background checks for certain jobs. Other spokespeople complained that the Guidance places an undue burden on smaller employers and that it is unclear when individualized assessments are necessary and bright-line rules are permissible. Other critiques are that the statement that an arrest may “in some cases” trigger an inquiry into whether the underlying conduct justifies an adverse employment action is hardly a model of clarity, and the examples do not pin down when these circumstances exist. The same criticism can be raised about the statement that a conviction will “usually” serve as evidence that a person engaged in particular conduct.
Conclusion. The Guidance is useful in many respects. It shows employers who use criminal history information in hiring decisions how to withstand a disparate treatment challenge to that practice. It explains the origins and evolution of the controversial and difficult-to-understand disparate impact theory and is replete with data showing that criminal background check policies are susceptible to attack under that theory. And it gives employers updated advice on how to avoid liability under the theory.
But the Guidance is also problematic. It is vague in many areas. Employers may find it difficult and expensive to follow. The EEOC must also be faulted for not acknowledging the risk to an employer if it fails to conduct a criminal history check on a new hire who harms a third party.
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This article is an abridged and edited version of one that originally appeared in the online magazine Business Law Today, March 2013.
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