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EEOC Issues New Guidelines on Conducting Criminal Background Checks on Employees

EEOC Issues New Guidelines on Conducting Criminal Background Checks on Employees
Employers are increasingly viewing and conducting criminal background checks of employees. Many employers conduct background checks in an attempt to avoid workplace theft or other problems in the workplace. Employers are now finding it easier to get their hands on criminal background information but they should be aware that improper use of information obtained through a criminal background check may run afoul of Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq. (“Title VII”). The U.S. Equal Employment Opportunity Commission (“EEOC”) recently issued guidance (the “Guidance”) containing best practices for employers who regularly conduct criminal background checks on employees. See Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964.

Title VII Prohibits Disparate Treatment and Disparate Impact
Title VII prohibits employment discrimination based on race, color, religion, sex, or national origin. Title VII does not explicitly list having a criminal record as a protected characteristic. Therefore, protection under Title VII depends on whether an employee can show that he or she was a victim of “disparate treatment” or “disparate impact.”

  • Disparate Treatment: Disparate treatment occurs when an employer covered by Title VII treats a particular employee differently than another similarly situated employee because of a protected characteristic in connection with employee’s criminal record. The example provided by the EEOC is that disparate treatment exists when an employer refuses to hire an African American applicant based on his criminal record but hires a similarly situated Caucasian applicant with a comparable criminal record.
  • Disparate Impact: Disparate impact occurs when a neutral policy put in place by an employer covered by Title IV has the effect of disproportionately screening out a group with protected characteristics and the employer fails to demonstrate that the policy or practice is job-related and consistent with business necessity. See Griggs v. Duke Power Co., 401 U.S. 424 (1971).

Determining Disparate Impact Liability
The EEOC Guidance outlines a basic framework for determining liability for Title VII disparate impact claims. First, the employee will need to identify the policy or practice at issue and then must investigate whether any disparate impact exists as a result of the policy or practice. An employer may present local and company data to show that such instances do not occur at disproportionately higher rates in the employer’s particular company or geographic area. The employer’s reputation for failing to hire applicants with a criminal record may also be taken into consideration.

If it is determined that a disparate impact exists, the focus then shifts to the employer to show that the challenged practice is “job related for the position in question and consistent with business necessity.” 42 U.S.C. § 2000e-2(k)(1)(A)(i); see also Griggs v. Duke Power Co., 401 U.S. 424 (1971). The employer must show that the policy or practice is one that “bear[s] a demonstrable relationship to successful performance of the jobs for which it was used” and “measures the person for the job and not the person in the abstract.” Griggs, 401 U.S. at 436.
In order to determine whether the practice is job-related, the Guidance relies on the three factors outlined by the Eighth Circuit in Green v. Mo. Pac. R.R., 549 F.2d 1158, 1160 (8th Cir. 1977). The Green factors are:

  • The nature and gravity of the offense or conduct;
  • The time that has passed since the offense or conduct and/or completion of the sentence; and
  • The nature of the job held or sought.

Green, 549 F.2d at 1160.

Employers are Cautioned Not to Rely on Arrests
The Guidelines clearly caution employers about the dangers of improperly relying on arrest records to make employment decisions. The Guidelines specifically point out that a record of an arrest does not mean that an employee engaged in any criminal conduct, and many arrests do not result in criminal charges. The Guidelines are clear that an employer’s action based solely on an arrest record is not job related or consistent with business necessity. While it is true that an employer cannot rely on an arrest record alone, an employer may make an employment decision based on the conduct underlying the arrest if such conduct would make an applicant unqualified for the position. It is important to distinguish the fact that it is the conduct that is relevant for the employment purposes, not the fact of the arrest itself.

Conviction Records More Reliable for Employers
Unlike the arrest record, a conviction record will usually be sufficient evidence for employers that a person engaged in the conduct outlined in the conviction record. The Guidelines caution, however, that employers should not ask employees about convictions on job applications. Rather, the Guidelines instruct employers to limit inquiries into conviction records to those that are job related for the position and consistent with business necessity.

How to Determine Whether a Criminal Conduct Exclusion Is Job Related and Consistent with Business Necessity
An employer must show that a screening policy links specific criminal conduct with the risks inherent in the duties of a particular position. There are two instances where the EEOC believes employers will consistently meet the requirements of job-relatedness and business necessity:

  • By conducting a validation study; or
  • By developing a targeted screening based on the Green factors, and providing an opportunity for an individualized assessment for people excluded by the screening to determine whether the policy as applied is job related and consistent with business necessity.

An individualized assessment would include notice to the applicant and an opportunity for the applicant to explain why the exclusion should not be applied in his or her particular circumstances, and consideration by the employer as to whether the additional information provided warrants an exception to the exclusion. Even if the employer can show that the exclusion was targeted under the Green factors, an employee can still prevail if he or she can point to a less discriminatory “alternative employment practice” that serves the employer’s legitimate goals as effectively and that the employer failed to adopt.

Defenses to Discrimination Charges
There are some defenses to discrimination charges under Title VII in relation to disparate impact claims. These defenses include excluding certain individuals with records in certain industries that are subject to federal or regulatory requirements that prohibit individuals with certain criminal records from holding particular positions or participating in certain occupations. This includes positions that require eligibility for certain occupational licenses, registrations, national security clearances, and the like. Certain states may also have similar occupational and licensing requirements. The state requirements are subject to federal law and must be job related and consistent with business necessity, otherwise such requirements will not shield an employer from liability under Title VII.

What Employers Should Know – Best Practices
The Guidelines present several suggested best practices for employers:

  • Eliminate policies or practices that exclude applicants from employment based on the existence of any criminal records.
  • Provide training to managers about disparate treatment and disparate impact claims under Title VII.
  • Develop a narrowly tailored written policy for screening applicants based on criminal conduct, including identifying specific offenses that may make an applicant unfit for a particular position, and creating a procedure for including an individualized assessment of applicants.
  • Maintain a record of the justification for the screening policy and any notes documenting the development of the policy.
  • Educate managers on how to implement any screening policies.
  • Limit questions to applicants related to criminal records to those that are job related and consistent with business necessity.
  • Develop a procedure for maintaining the confidentiality of applicant’s criminal background information.

If you have questions about whether your policies regarding background checks comply with the new Guidelines, please contact any of the Trepanier MacGillis Battina P.A. employment law attorneys.