Key Takeaways from the New EEOC Guidance on Employment Criminal Records

On April 25, 2012 the EEOC issued its much-anticipated updated enforcement guidelines on employers’ use of criminal records (arrest and conviction records) in the employment screening process. Since then we’ve received many phone calls and emails asking questions about what this all means.

The guidance specifically relates to Title VII of the Civil Rights Act of 1964, which is enforced by the EEOC, and is an update to the longstanding previous guidance issued more than twenty years ago.  According to the EEOC, the current updates are needed to reflect today’s increased access to criminal record information, case law analyzing Title VII requirements for criminal records exclusions, and other developments.

We’ve attempted to boil down the 52-page guidance document to provide key takeaways to help you, as an employer, understand the possible impact on your employment screening program. No doubt we won’t answer all of your questions here so we’ll follow up with additional posts to tease out more of the details, but we hope this will set you on the right track.

What’s driving the EEOC’s interest in employment criminal records?

The EEOC is responsible for enforcing federal laws that protect against job discrimination, including Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination based on race, color, religion, sex, or national origin.

In assessing potential liability for employment discrimination, the EEOC looks through two lenses: disparate treatment (when an employer treats an individual or a class of individuals differently because of their race, national origin, or other protected basis – intentional unlawful discrimination) and disparate impact (when an employer’s neutral policy or practice has a disproportionately negative effect on a member of a protected class or an entire protected class – inadvertent unlawful discrimination).

An employer’s use of criminal records in hiring has become an EEOC enforcement focus because, without proper practices and policies in place, an employer runs a high risk of discriminating against certain protected classes.

Disparate Treatment Based on Criminal Records

In its updated guidance, the EEOC provides deeper insight into how it views and evaluates disparate treatment. To employers, this is important stuff. We’ve often talked about the need to avoid brightline policies when it comes to criminal records.  The latest EEOC guidance further illuminates, but does not fundamentally alter, its prohibition against brightline policies such as a policy against hiring anyone convicted of any felony for any position within an organization.

The EEOC points to specific evidence it will use to evaluate disparate treatment in an employer’s use of criminal records in a selection decision.  In other words, if the EEOC comes knocking on your door to investigate a charge of discrimination based on your use of criminal records in hiring, this is the type of evidence it will look for to support or dismiss its case:

    • Biased statements – Comments made by employer or decision makers that are derogatory with respect to an individual’s protected group, or that express stereotypes about criminality.
    • Inconsistent hiring processes – Evidence that the employer requested criminal history information more often for individuals with certain racial or ethnic backgrounds, or gave White but not racial minorities the opportunity to explain their criminal history.
    • Similarly situated comparators – Treating individuals differently solely on the basis of their protected group. For example, subjecting African Americans or Hispanics to more or different criminal background checks or evaluating the results of criminal records or applying standards differently than would be done for individuals not in the protected group.
    • Employment testing – Matched-pair testing may reveal that candidates are being treated differently because of a protected status.
    • Statistical evidence – Statistical analysis derived from an examination of the employer’s applicant data, workforce data, and/or third party criminal background history data may be used to determine if the employer counts criminal history information more heavily against members of a protected group.

Employers are wise to check their own practices and policies against each of the above factors.

A quick side note: The EEOC acknowledges that in some industries, employers are subject to federal statutory and/or regulatory requirements that prohibit individuals with certain criminal records from holding particular positions or engaging in certain occupations. The latest EEOC guidance does not change these requirements as compliance with federal laws and/or regulations is a defense to a charge of discrimination.

Disparate Impact of Employment Criminal Records

Disparate impact is a bit tougher to contend with when it comes to an employer’s use criminal records in hiring because the numbers simply don’t lie:

Arrest and incarceration rates are higher for African American and Hispanic men than for any other group. In fact, the EEOC reports that if current incarceration rates remain unchanged, about 1 in 17 White men are expected to serve time in prison during their lifetime, compared to 1 in 6 for Hispanic men and to 1 in 3 African American men.

The EEOC has repeatedly stated that “national data supports a finding that criminal record exclusions have a disparate impact” because of the disproportionate number of African American and Hispanic individuals with criminal backgrounds.

The updated EEOC guidance document brings forward the following points concerning how the EEOC will determine disparate impact:

    • First, the EEOC will look at the policy or practice in question.
    • Next, the Commission will assess whether that policy or practice deprives a disproportionate number of Title VII-protected individuals of employment opportunities.
    • Finally, the Commission will assess the “probative value” of an employer’s applicant data. In other words, if a company has a reputation for excluding or discouraging individuals with criminal records from applying in the first place, there would be nothing in the applicant data to show discrimination since presumably few people with criminal histories would even have applied.

The Big Question: Is the employment practice job-related and consistent with business necessity?

This is, and has been for the last 20+ years, the big question.  The longstanding test for assessing job-relatedness and business necessity (known as the “Green Factors” from the 1977 8th Circuit Case, Green v. Missouri Pacific Railroad, 549 F.2d 1158 (8th Cir. 1977) 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;
    • The nature of the job held or sought.

In its updated guidance, the EEOC references numerous court cases deemed relevant in assessing whether criminal record exclusion policies and practices will meet the test of job relatedness and business necessity.  We’ve boiled it down to the following:

Appropriate use of arrest vs. conviction records. Employers need to understand the difference because it’s a big one.  Simply put, arrest records are not proof of criminal conduct as they may not report the actual outcome of the situation so, in most situations, they should not be used as grounds for exclusion. Conviction records, on the other hand, typically serve as sufficient evidence that a person engaged in a particular conduct.  These records are more reliable and the use of them by an employer is more defensible.

Established link to role-related risk. Employers must be able to demonstrate an effective link between the specific criminal conduct and the risks inherent in the duties of a particular position. 

In this case, the EEOC points out that employers can consistently meet the job relatedness/business necessity defense by validating the position’s criminal screening per the Uniform Guidelines on Employee Selection Procedures (Uniform Guidelines) standards, OR — and this is important — developing a targeted screen considering at least the nature of the crime, the time elapsed, and the nature of the job (the three Green factors), and then providing an opportunity for an individualized assessment for people excluded by the screen to determine whether the policy as applied to the individual is job related and consistent with business necessity.

Individualized assessment is the big new idea. The rest is pretty much the same as always.

Employer Best Practices

The EEOC provides specific examples of best practices for employers who are considering criminal record information when making employment decisions.  In their insightful reporting of the guidance, Pamela Devata and Frederick Smith of the national employment law firm Seyfarth Shaw summed up the EEOC’s recommended best practices as follows:

    • Eliminate policies or practices that exclude people from employment based on any criminal record;
    • Train managers, hiring officials, and decision-makers about Title VII and its prohibition on employment discrimination;
    • Develop a narrowly tailored written policy and procedures for screening for criminal records;
    • Identify essential job requirements and the actual circumstances under which the jobs are performed;
    • Determine the specific offenses that may demonstrate unfitness for performing specific jobs;
    • Identify the criminal offenses based on all available evidence;
    • Determine the duration of position-specific exclusions for criminal conduct based on all available evidence;
    • Record the justification for the policy and procedures;
    • Note and keep 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;
    • When asking questions about criminal records, limit inquiries to records for which exclusion would be job related for the position in question and consistent with business necessity; and
    • Keep information about the criminal records of applicants and employees confidential (only use it for the purposes for which it was intended).

Our overarching impression? There is not a whole lot of earth-shattering new information here. While this latest guidance adds a bit more to the plates of HR and hiring managers in the way of individualized assessment, for the most part we see a lot of the same long-advocated and promoted criminal records screening best practices that reputable background screening companies and the EEOC itself have been promoting for decades.

The number one takeaway we see is this: The EEOC is sending a crystal clear warning signal to employers about their hiring and screening practices.  If you haven’t taken a close hard look at your policies and procedures lately, now’s the time.  EEOC investigation activity is increasing and the last thing you want to do is find yourself the subject of a headline like this.

Have questions about your own background screening program?  Ask one of our experts.

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About Michael Gaul

A security industry professional since 1988, Michael has extensive expertise in the fields of human capital risk management, physical security, and background screening process management. Michael leads Proforma’s sales, marketing, and strategic customer relations efforts.
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