EEOC Issues New Enforcement Guidance on Employer Consideration of Criminal Records in Employment

Yesterday, the EEOC issued Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act, which restates in more detail the position it has held for a few decades concerning arrest records. Exclusion of applicants based solely on a record of being arrested has an unlawful disparate impact on African-American men without being job related because a mere arrest is not determinative of guilt or proof criminal conduct. In addition, the EEOC now indicates that exclusion of applicants for a criminal conviction may have a similar disparate impact unless the employer can show that it complied with the Uniform Guidelines on Employee Selection Procedures, that the employer always considers “the nature of the crime, the time elapsed, and the nature of the job” (and often conducts an “individualized assessment” which involves discussing the issue with the individual) or that the employer is complying with another federal statute or regulation that conflicts with Title VII. “A covered employer is liable for violating Title VII when the plaintiff demonstrates that the employer’s neutral policy or practice has the effect of disproportionately screening out a Title VII-protected group and the employer fails to demonstrate that the policy or practice is job related for the position in question and consistent with business necessity.”

At the heart of the EEOC’s position are the following statistics, some of which is from a Pew Center Report:

Arrest and incarceration rates are particularly high for African American and Hispanic men. African Americans and Hispanics are arrested at a rate that is 2 to 3 times their proportion of the general population. Assuming that current incarceration rates remain unchanged, about 1 in 17 White men are expected to serve time in prison during their lifetime by contrast, this rate climbs to 1 in 6 for Hispanic men; and to 1 in 3 for African American men.

. . .

Simply stated, incarceration in America is concentrated among African American men. While 1 in every 87 white males ages 18 to 64 is incarcerated and the number for similarly-aged Hispanic males is 1 in 36, for black men it is 1 in 12.”). Incarceration rates are even starker for 20-to-34-year-old men without a high school diploma or GED: 1 in 8 White males in this demographic group is incarcerated, compared to 1 in 14 Hispanic males, and 1 in 3 Black males.

. . . .

Based on a state-by-state examination of incarceration rates in 2005, African Americans were incarcerated at a rate 5.6 times higher than Whites, and 7 states had a Black-to-White ratio of incarceration that was 10 to1. In 2010, Black men had an imprisonment rate that was nearly 7 times higher than White men and almost 3 times higher than Hispanic men.

In addition, the EEOC also expresses a concern of which many of us who regularly work in this area are aware: public criminal records are often incomplete and sometimes even inaccurate. (This has often led to me helping a client track down the disposition of arrests and charges through court and other records to confirm information provided by the applicant and/or employee).

Recent studies have found that a significant number of state and federal criminal record databases include incomplete criminal records.

• A 2011 study by the DOJ/BJS reported that, as of 2010, many state criminal history record repositories still had not recorded the final dispositions for a significant number of arrests.

• A 2006 study by the DOJ/BJS found that only 50% of arrest records in the FBI’s III database were associated with a final disposition.

Additionally, reports have documented that criminal records may be inaccurate.

. . . . Another report found that criminal background checks may produce inaccurate results because criminal records may lack “unique” information or because of “misspellings, clerical errors or intentionally inaccurate identification information provided by search subjects who wish to avoid discovery of their prior criminal activities.”

One study cited by the EEOC and conducted by the Department of Justice found “that in a sample of 82,601 employment applicants, 4,562 of these individuals were inaccurately indicated by a “name check” to have criminal records, which represents approximately 5.5% of the overall sample.”

It is troubling that the EEOC seems to imply that the guilt of the convicted individual is irrelevant to its disparate impact analysis and that conviction records are more indicative of racism than a legal determination of guilt beyond a reasonable doubt upon which an employer is entitled to rely. Nonetheless, it recognizes that “record of a conviction will usually serve as sufficient evidence that a person engaged in particular conduct, given the procedural safeguards associated with trials and guilty pleas.” However, it “recommends” that employers stop asking about criminal convictions on job applications and reserve this inquiry to the latter stages of the employment process based on the possibility that criminal records will be inaccurate and fail to reflect, among other things, expungements. Moreover, it also recommends (but does not require in all circumstances) that the employer conduct an “individualized assessment” of the circumstances surrounding the conviction, such as “notice to the individual that he has been screened out because of a criminal conviction; an opportunity for the individual to demonstrate that the exclusion should not be applied due to his particular circumstances; and consideration by the employer as to whether the additional information provided by the individual warrants an exception to the exclusion and shows that the policy as applied is not job related and consistent with business necessity.”

In addition, the EEOC cites a 1975 Eighth Circuit decision finding that a blanket exclusion of anyone convicted of any crime violated Title VII and implies that a 2007 summary judgment -- for a Third Circuit employer which excluded as paratransit drivers anyone convicted of a violent felony -- was sustainable only because of statistical evidence which the employer produced concerning recidivism. If the EEOC finds that an employer is excluding candidates based on a criminal conviction, it may consider that exclusion – and the employer’s reputation for excluding convicted criminals -- to violate Title VII.

An employer’s evidence of a racially balanced workforce will not be enough to disprove disparate impact. In Connecticut v. Teal, the Supreme Court held that a “bottom line” racial balance in the workforce does not preclude employees from establishing a prima facie case of disparate impact; nor does it provide employers with a defense. The issue is whether the policy or practice deprives a disproportionate number of Title VII-protected individuals of employment opportunities.

. . . . , in determining disparate impact, the Commission will assess the probative value of an employer’s applicant data. As the Supreme Court stated in Dothard v. Rawlinson, an employer’s “application process might itself not adequately reflect the actual potential applicant pool since otherwise qualified people might be discouraged from applying” because of an alleged discriminatory policy or practice. Therefore, the Commission will closely consider whether an employer has a reputation in the community for excluding individuals with criminal records. Relevant evidence may come from ex-offender employment programs, individual testimony, employer statements, evidence of employer recruitment practices, or publicly posted notices, among other sources. The Commission will determine the persuasiveness of such evidence on a case-by-case basis. (italics added for emphasis).

. . . .

[Even where an employer shows that its policy and practice is job related and consistent with business necessity], a Title VII plaintiff may still prevail by demonstrating that there is a less discriminatory “alternative employment practice” that serves the employer’s legitimate goals as effectively as the challenged practice but that the employer refused to adopt.

The EEOC asserts that many “targeted exclusions” – “an employer policy or practice of excluding individuals from particular positions for specified criminal conduct within a defined time period” -- are likely to survive a disparate treatment analysis (even in the absence of a validation study concerning recidivism or a federal statute providing a safe harbor). Moreover, although not always necessary to survive a disparate treatment challenge, the EEOC also advocates an “individualized assessment,” ( i.e., where “ 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”). Among other things, an individualized assessment may reveal the existence of an error in the criminal record.

What will be troublesome for most employers is that the EEOC does not consider compliance with a state statute or local ordinance that requires the exclusion of certain individuals who have been convicted of certain crimes to be a defense to potential Title VII liability. Of course, if the EEOC finds that the exclusion required by the statute or ordinance to be reasonably targeted, job related and consistent with business necessity, it may not challenge the employer’s compliance with it.

Although the EEOC does not believe that an arrest record by itself should exclude anyone from employment, it recognizes that “[a]n arrest, however, may in some circumstances trigger an inquiry into whether the conduct underlying the arrest justifies an adverse employment action.” As an example, the EEOC discusses a situation where a school employee is accused of inappropriate sexual contact with children. The School may conduct its own investigation following the employee’s arrest and terminate the employee based on its own conclusions and policies regardless of whether the employee is charged or convicted (based on a guilt beyond a reasonable doubt standard).

In light of the EEOC’s new enforcement guidance, employers should examine their employment policies concerning background checks.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.