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Changes may prompt review of background check policies

August 14, 2013
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Indiana Lawyer Focus

For more than 20 years, the Equal Employment Opportunity Commission has taken the position that an employer’s use of applicants’ criminal history in making employment decisions may constitute discrimination under Title VII of the Civil Rights Act of 1964, as amended. The underlying premise has always been that because minorities are historically and statistically arrested and incarcerated at higher rates than their representation in the general population, the use of criminal records by employers in making hiring and retention decisions may be discriminatory.

erdel-katherine.jpg Erdel

The EEOC’s enforcement guidance

Citing increased access to criminal history information as motivation, the EEOC issued an updated “Enforcement Guidance” memo on this topic in April of 2012. This past June, the EEOC filed two lawsuits against employers alleging that the employers’ respective criminal background policies violated Title VII. The lawsuits both seem to highlight the EEOC’s increased interest in the potential discriminatory impact of employers’ use of criminal records in employment decisions.

In EEOC v. BMW Manufacturing Co., LLC, pending in the U.S. District Court of South Carolina, the EEOC alleges that BMW’s background check policy disproportionately screened out African-Americans and that the policy is not job related or consistent with business necessity. The second suit, a nationwide lawsuit pending in District Court in Chicago, EEOC v. Dolgencorp (which does business as Dollar General), addresses discrimination charges filed by two rejected black applicants. That suit alleges that Dollar General conditions its job offers on criminal background checks and that the policy results in a disparate impact against blacks.

Indiana law

States, including Indiana, are also showing an increased interest in this area. Though there is no federal law or law in Indiana prohibiting employers from using criminal background information in the hiring process, a new state background check law includes several provisions aimed at limiting the types of information that may be disclosed to employers in Indiana.

Effective July 1, 2013, House Enrolled Act 1033 (2012) permits Indiana residents with restricted or sealed criminal records to state on an employment application that they have not been adjudicated, arrested or convicted of the offense included in the restricted records. On the flip side, the new law prohibits employers from asking about sealed and restricted criminal records, and courts are prohibited from disclosing information related to certain infractions. For example, a court cannot disclose information related to an infraction (which generally includes traffic citations and other minor violations) when the individual has satisfied the judgment and five years has passed since that satisfaction. Criminal history providers may be penalized for violating this law, including up to $1,000 for a first violation, up to $5,000 for a second violation, actual damages, liquidated damages, and costs and attorney’s fees. The text of the bill can be found at: http://www.in.gov/legislative/bills/2012/HE/HE1033.1.html.

Appropriate use of criminal history information

While Indiana law and the EEOC’s Enforcement Guidance provide clear guidance on certain prohibited conduct, many employers are still unclear on what they can and should do to appropriately use criminal history information in the hiring process. In its Enforcement Guidance, which can be found at www.eeoc.gov/laws/guidance/arrest_conviction.cfm, the EEOC concludes that employers cannot exclude an applicant from employment based on an arrest record alone. The EEOC also recommends that “employers not ask about convictions on job applications and that, if and when [employers] make such inquiries, the inquiries be limited to convictions for which exclusion would be job related for the position in question and consistent with business necessity.”

Policy validation under the EEOC’s Enforcement Guidance

The EEOC’s Enforcement Guidance goes on to suggest two methods under which an employer may be able to “validate” that its background check policy and use of criminal records to exclude individuals from employment is job related and consistent with business necessity.

The first involves validation using Uniform Guidelines on Employee Selection Procedures, found at 29 C.F.R §1607. However, the EEOC seems to acknowledge that this particular method is currently unworkable given the limited amount of empirical data on the links between certain conduct, criminal histories and job performance. As a result, most employers will likely need to rely upon the second method to determine whether its policies and practices are job related and consistent with business necessity.

Under the second method proposed by the EEOC, an employer first develops a “targeted screen” that considers, at a minimum, the nature of the crime, the time elapsed since the offense or completion of the sentence, and the nature of the job. After an applicant has been preliminarily disqualified by the screen, the employer conducts an individualized assessment to determine whether the screen, as applied, is actually job related and consistent with business necessity.

For example, if employer XYZ determines that any individual who has been convicted of embezzlement in a business setting in the last five years should be preliminarily disqualified from a job as an accounting department manager, XYZ has likely created a reasonable “targeted screen” that takes into account the three factors required by the EEOC. However, when applicant John Doe applies for an accounting department manager position and is preliminarily screened out because of his four-year-old embezzlement conviction, XYZ must then talk with Mr. Doe and conduct an individualized assessment.

The EEOC provides a list of criteria that employers should consider in the course of an individualized assessment: whether the individual identified in the report is the same individual who has applied for the position; the facts or circumstances surrounding the conduct; the number of offenses; older age at the time of conviction or release; evidence that the individual has performed the same type of work successfully post-conviction; the length and consistency of employment history before and after the conduct; rehabilitation efforts (like education or training); employment or character references or other information regarding fitness for the position; and whether the individual is bonded under a state or local bonding program. Only after considering all of these factors should XYZ make its ultimate decision as to whether or not to hire Mr. Doe.

Simple, right? Not quite. As interest grows in this area and as the courts involved hand down decisions on related cases, additional guidance and examples should be forthcoming. In the meantime, all attorneys, especially those who advise employers, should familiarize themselves with the EEOC’s Enforcement Guidance and HEA 1033 (2012).•

__________

Katherine G. Erdel is a member of Bingham Greenebaum Doll LLP’s Labor and Employment Practice Group, focusing her practice in the areas of discrimination defense, wage and hour advice, general workplace policies, and employment agreements and covenants not to compete. Kate regularly advises clients in these areas and is familiar with background checks, pre-employment inquiries and other employment best-practice issues. Opinions expressed are those of the author.

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  1. A traditional parade of attorneys? Really Evansville? Y'all need to get out more. When is the traditional parade of notaries? Nurses? Sanitation workers? Pole dancers? I gotta wonder, do throngs of admiring citizens gather to laud these marching servants of the constitution? "Show us your billing records!!!" Hoping some video gets posted. Ours is not a narcissistic profession by any chance, is it? Nah .....

  2. My previous comment not an aside at court. I agree with smith. Good call. Just thought posting here a bit on the if it bleeds it leads side. Most attorneys need to think of last lines of story above.

  3. Hello everyone I'm Gina and I'm here for the exact same thing you are. I have the wonderful joy of waking up every morning to my heart being pulled out and sheer terror of what DCS is going to Throw at me and my family today.Let me start from the !bebeginning.My daughter lost all rights to her 3beautiful children due to Severe mental issues she no longer lives in our state and has cut all ties.DCS led her to belive that once she done signed over her right the babies would be with their family. We have faught screamed begged and anything else we could possibly due I hired a lawyer five grand down the drain.You know all I want is my babies home.I've done everything they have even asked me to do.Now their saying I can't see my grandchildren cause I'M on a prescription for paipain.I have a very rare blood disease it causes cellulitis a form of blood poisoning to stay dormant in my tissues and nervous system it also causes a ,blood clotting disorder.even with the two blood thinners I'm on I still Continue to develop them them also.DCS knows about my illness and still they refuse to let me see my grandchildren. I Love and miss them so much Please can anyone help Us my grandchildren and I they should be worrying about what toy there going to play with but instead there worrying about if there ever coming home again.THANK YOU DCS FOR ALL YOU'VE DONE. ( And if anyone at all has any ideals or knows who can help. Please contact (765)960~5096.only serious callers

  4. He must be a Rethuglican, for if from the other side of the aisle such acts would be merely personal and thus not something that attaches to his professional life. AND ... gotta love this ... oh, and on top of talking dirty on the phone, he also, as an aside, guess we should mention, might be important, not sure, but .... "In addition to these allegations, Keaton was accused of failing to file an appeal after he collected advance payment from a client seeking to challenge a ruling that the client repay benefits because of unreported income." rimshot

  5. I am not a fan of some of the 8.4 discipline we have seen for private conduct-- but this was so egregious and abusive and had so many points of bad conduct relates to the law and the lawyer's status as a lawyer that it is clearly a proper and just disbarment. A truly despicable account of bad acts showing unfit character to practice law. I applaud the outcome.

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