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ELL_5-28-15-amwThe Equal Employment Opportunity Commission (EEOC) recently issued a Strategic Enforcement Plan which lists as one of its priorities “Eliminating Barriers in Recruitment and Hiring.” This priority includes legal challenges to policies and practices that exclude applicants based on criminal history.

As part of those enforcement measures, the EEOC published its Criminal History Guidance to detail the agency’s concerns regarding use of criminal history in the hiring process and factors that employers are expected to consider prior to excluding any applicant based on criminal history.

The EEOC stresses that any reliance on criminal history records that have an adverse impact on protected groups must be job related and consistent with business necessity.

Best Employer Practices: Three Factors to Consider

The EEOC’s Guidance advises employers to consider three important factors if they use criminal background checks: (1) the nature and gravity of the offense or conduct; (2) the time that has passed since the offense, conduct and/or completion of the sentence; and (3) the nature of the job held or sought. The Guidance further underscores the importance of an “individualized assessment” prior to excluding an applicant based on a criminal record.

Federal Employment Law

Title VII of the Civil Rights Act of 1964 does not directly prohibit or restrict the use of credit or criminal history checks by employers. In fact, Title VII doesn’t even mention background checks. However, an employer’s use of background checks can create Title VII liability if the report adversely affects an applicant or employee on the basis of one or more characteristics that are protected from discrimination under Title VII (e.g., race, gender or national origin).

Under Title VII, there is a potential for liability based on two types of legal claims. The first of these is known as Disparate Treatment.

In such a case, the EEOC identifies several kinds of evidence that could be used to establish an employer’s liability for using race, national origin or other protected status as a motivation for using criminal records, including:

  • Biased statements that express “group-related” stereotypes about criminality.
  • Inconsistencies in the hiring process, i.e., an employer requesting criminal information more often for individuals belonging to certain racial or national groups.
  • Statistical evidence showing that an employer uses criminal record information more heavily for a protected class.

Another type of legal claim is called Disparate Impact.

Determining Disparate Impact of Policies or Practices

Disparate Impact is a theory of liability that prohibits an employer from using a racially neutral employment practice that has an adverse impact on members of a protected class. Statistics compiled by the EEOC show that a higher percentage of African-American males have a criminal record. Thus, a hiring policy that includes a “blanket exclusion” of any applicant with a criminal record could cause an unlawful disparate impact.

In investigating whether an employment policy could have an adverse impact, the EEOC will scrutinize the following factors: what criminal offenses or classes of offenses are being reported to an employer (e.g., all felonies, all drug offenses); whether convictions (including sealed and/or expunged convictions), arrests, charges or other criminal incidents are reported; how far back in time the reports reached (e.g., the last five, 10 or 20 years); and the jobs for which the criminal background screening was conducted.

Thus, it is important to carefully draft a policy that meets the EEOC’s validation criteria.

Another Important Consideration: The FCRA

The Fair Credit Reporting Act (FCRA) is a United States federal law that applies if a company obtains background information (for example, a credit or criminal background report) from a company in the business of compiling background information. In such situations, the FCRA requires notice to an applicant that an employee might use the information for decisions about his or her employment and requires that written permission be obtained to do so. Additional obligations under the FCRA are also applicable to the use of what is known as an “investigative report.”

Disposing of Background Information

Finally, any personnel or employment records (including all application forms, regardless of whether the applicant was hired, and other records related to hiring) must be preserved for one year either after the records were made or after a personnel action was taken, whichever comes later.

Once an employer satisfies all applicable recordkeeping requirements, it may then dispose of any background reports in a secure manner. That can include burning, pulverizing or shredding paper documents and disposing of electronic information so that it cannot be read or reconstructed.