Now that we have had a chance to pour over all 52 pages including every end note and reference, we have compiled the ultimate summary of the new EEOC guidance on the use of criminal history in a nutshell, along with our own take on what it all means. In this instance, a nutshell turned out to be three pages long. It is not exhaustive, reasonable people can (and will) debate the interpretation of what it all means, and this is certainly not legal advice. But here it is, and we welcome your continued comments and questions. For those of you who missed the webinar we held last week on this topic you can download it here.
The EEOC has long maintained that the use of credit and criminal history in hiring can lead to “disparate impact” discrimination. Disparate impact claims rely on statistical information to prove that use of criminal history and credit information has an unintended discriminatory effect on a protected class—in this case, African Americans and Hispanics. New criminal history guidance, published April 25, 2012, supports the Commission’s commitment to put an end to systemic discrimination and its E-RACE initiative, Eradicating Racism and Colorism in Employment. In the past year, the EEOC has filed a record number of class action lawsuits alleging that employer’s use of criminal history information amounts to discrimination, and Pepsi recently paid a very well publicized $3.13 million to settle a class action suit brought by the EEOC.
Technically speaking, the EEOC guidance is not binding on courts and carries no “official” legal weight. The EEOC does not have the authority to create statutes or issue non-procedural regulations under Title VII, unlike Congress. In addition, because the EEOC did not allow for public comment prior to publication of the current guidance, it may be vulnerable to challenges in court. In practice, however, courts rely heavily on agency policy statements and the EEOC guidance in particular. Failure to heed the guidance may land you in Federal Court defending a class action claim. What follows is a summary of the Guidance, best practices, and some practical considerations for going forward.
The New Guidance
The new guidance supersedes the old policy statements issued by the EEOC in 1987 and 1990 on conviction and arrest records. Job relatedness and business necessity remain the legal standard for an employer’s defense. The two times when this standard is met are defined:
1. Validation Studies: “The employer validates the criminal conduct exclusion for the position in question in light of the Uniform Guidelines on Employee Selection Procedures”;
2. Targeted Screening with Individualized Assessments: “The employer develops a targeted screen considering at least the nature of the crime, the time elapsed, the nature of the job (the
Green factors). The employer’s policy then provides an opportunity for an individualized assessment for those people identified by the screen, to determine if the policy as applied is job related and consistent with business necessity.”
• The nature and gravity of the offense or offenses;
• The time that has passed since the conviction and/or completion of the sentence; and
• The nature of the job held or sought
• Individualized Assessment
Since validation studies are extremely difficult and expensive and the social science to support them is not well-evolved, the Guidance concedes that a targeted screening is the more likely option for the vast majority of employers who rely on a criminal background check.
As explained in the Guidance: “Individualized assessment generally means that an employer informs the individual that he may be excluded because of past criminal conduct; provides an opportunity to the individual to demonstrate that the exclusion does not properly apply to him; and considers whether the individual’s additional information shows that the policy as applied is not job related and consistent with business necessity.”
“The individual’s showing may include information that he was not correctly identified in the criminal record, or that the record is otherwise inaccurate.”
Factors to consider for Individualized Assessment:
1. Facts or circumstances surrounding the offense or conduct
2. The number of offenses for which the individual was convicted
3. Older age at the time of conviction, or release from prison
4. Evidence that the individual performed the same type of work post-conviction, with the same or a different employer, with no known incidents of criminal conduct
5. The length and consistency of employment history before and after the offense or conduct
6. Rehabilitation efforts (e.g., education/training)
7. Employment or character references and any other information regarding fitness for the particular position
8. Whether the individual is bonded under a federal, state, or local bonding program
Best Practices identified in the Guidance:
• Do not ask for criminal information on applications. Inquiries about convictions, if made, should be narrowly tailored and limited only to those that are job-related.
• Develop a narrowly tailored written policy and procedure for screening applicants and employees for criminal conduct.
• The policy should identify essential job requirements and the actual circumstances under which the jobs are performed.
• The policy should also determine the specific offenses that may demonstrate unfitness for performing such jobs, and the duration of exclusions for criminal conduct.
• Record the justification for the policy, procedures, and exclusions, including a record of consultations and research considered in crafting the policy and procedures.
• Train managers, hiring officials, and decision makers on how to implement the policy and procedures consistent with Title VII.
Practical Implications for Employers
• Eliminate policies that exclude applicants with any criminal record.
• Review your paper job applications and pre-hire documents. If you are using an ATS or web based applicant entry system, consider removing any inquires about criminal history from the application.
• Limit inquiries about criminal convictions to those which are job related.
• While individual assessment is not required by Title VII, the guidance implies that without it, you will have a more difficult defense. No examples are given of a scenario where an employer is successful without individualized assessment.
• If an individual does not respond to an employer’s request for additional information, the employer can make a final decision without the additional information. How long or under what circumstances an employer must wait is not clear.
• If you use a third party CRA to conduct criminal screenings, review your packages and their reporting policies to ensure compliance.
• If you use a third party CRA to adjudicate criminal results, consider building in a review process to comply with the individualized assessment recommendations.
• Consider FCRA adverse action procedures and ways to incorporate the request for additional information needed for individualized assessments.
• Note that simply having a reputation for discouraging applicants based on race may invite investigation by the EEOC.
• Large applicant pools have greater potential for disparate impact, so big employers with high turnover should seek counsel in determining the best means of compliance.
• Compliance with a Federal law/mandate that conflicts with the Guidance is a defense.
• State and local mandates are NOT a defense. They are pre-empted by Title VII if they “purport to require or permit the doing of any act which would be an unlawful employment practice” under Title VII.