EEOC Issues Guidelines Addressing the Use of Background Checks in Employment

By: Heather M. Sager

The EEOC (the “Commission”) recently issued guidelines addressing the use of background checks in employment.  Generally speaking, a “background check” or “consumer report” is something that is obtained from a reporting agency and reflects a consumer’s credit, character, reputation, standing, lifestyle, or the like, and is used (in this context) for the purpose of determining employment eligibility (whether for hire, promotion, eligibility to work at a particular job site, etc.).  While the Commission had been focused on this issue to some extent since 2007, the new guidelines suggest that the EEOC plans to launch an aggressive enforcement campaign aimed at preventing perceived inherent disparate impact discrimination via the most common background check scenarios.

At the heart of the Commission’s guidelines and, indeed, currently the subject of legislative debates in many states, are “Ban the Box” recommendations.  The “Box” being referenced typically appears on an employment application as a Yes/No choice, seeking disclosure of any prior convictions or pending criminal charges.  The disclosure, if any, acts as a de facto bar to employment. The EEOC has now publicly expressed the presumption that any policy that mandates an adverse employment decision for any criminal history is inherently discriminatory.

EEOC guidance mandates what should be logical — any disclosure or “hit” on a background check should be considered on an individualized basis.  Factors the EEOC recommends considering include the nature and gravity of the offense, the age of the offense, and the nature of the job at issue.  Where an employer can point to a rational relationship between the job and the offense so as to justify disqualification from employment, the Commission will not likely find discrimination occurred.  The clearest example is disqualifying an applicant with a fraud conviction from work as a bank teller — a position in which the person would handle funds with little supervision and be responsible for reporting balances and the like.  Where businesses run in to trouble is in disqualifying applicants or employees based on a “zero tolerance” policy, or because the individual is guilty of crimes the employer finds inherently offensive, though they lack a rational relationship to the job duties at issue.  One of the most common examples is an employer’s policy of refusal to hire anyone found guilty of a “sex offense,” without further clarifying the meaning of that term.  That phrase can mean many things, including potentially having consensual sexual relations with someone just a few years younger than majority age (e.g., an 18-year old boy and a 17-year old girl in California).  Absent individualized inquiry and analysis, a blanket policy could result in unjust actions, whether putatively race-based or otherwise.

The federal Fair Credit Reporting Act (“FCRA”) further requires that detailed disclosures be given to employees before background checks are done, when any adverse action is contemplated, and again when an adverse action decision is finalized.  Separate disclosures are required if the background check will also include “interviews” (e.g., discussions with prior employers) in additional to database research.  The FCRA is very specific about the format of each of these notices. And nearly half of the United States have requirements that are stricter and even more specific than those set forth in the federal FCRA. Some even mandate particular type fonts. As with any procedural violation, class certification is often virtually guaranteed (given the absence of individualized treatment). Violations of the FCRA requirements, for example, can multiply at the rate of $100-$1000 per violation (e.g., per applicant or employee, for the entire statutory period).  It is common that businesses seldom complete all steps of the process correctly.

So, how does all this play out in the workplace?  Fixing the paperwork might be the easy part.  Most employers don’t want to spend the time or money going through individualized analyses, which the Commission says should include discussions with the subject individual to explore circumstances surrounding the offense at issue before a final decision is made.  “Zero tolerance” policies are certainly much easier (and more expedient) from an employer perspective, and companies often bank on the fact that applicants or employees with “dirty laundry” may be less likely to raise complaints about potentially unfair policies.  However, the Commission is empowered to pursue violations on behalf of an absent class — there does not have to be a proactive complainant.  At present, the EEOC is actively engaged in hundreds of claims involving alleged violations of applicant/employee rights associated with background check procedures, and we anticipate the recent Commission guidelines to encourage the plaintiffs’ bar to focus on this area of the law in the context of class actions.  In sum, this is a good time for businesses to take a fresh look at not just their paperwork, but in how they utilize the results of any consumer investigative report.

Editor’s note – Please see our other coverage of the EEOC’s guidance on use of background check’s here.

EEOC’s Guidance on the Use of Criminal History Records Under Title VII Comes as New News to Many Small Businesses

By: Frank Nardulli

In our post on April 30, 2012, we highlighted the EEOC’s recent guidance on the use of criminal history records to discriminate against job applicants.  To read our original post click here.  As businesses large and small now look to make sense of the new guidance, and to tailor appropriate policies, many are discovering that they may have been unknowingly violating the law.  For some interesting thoughts on the EEOC’s Guidance on the use of criminal history records under Title VII from the perspective of small businesses, check out this well-sourced post by New York Times reporter Robb Mandelbaum and his related article.

EEOC Issues New Guidance on Use of Arrest and Conviction Records Under Title VII

On April 25, 2012, the EEOC issued its first update in 20 years of its position on employers’ use of arrest and convictions records in making employment decisions.

The EEOC’s Guidance discusses employers’ use of arrest and conviction records in the context of Title VII of the Civil Rights Act’s prohibition on race and national origin discrimination. It first makes clear what most employers already know – employers cannot require or apply criminal background checks differently for one group of employees than another protected class of employees. The  focusof the EEOC’s new Guidance, however, is that reliance on criminal records can have a disparate impact on certain protected groups and, therefore, violate Title VII.

To read our full alert authored by Mark Nelson and Frank Nardulli click here.

Revised guidelines for both employers and veterans regarding the Americans with Disabilities Act

By: Marion Cooper

On February 28, 2012, the U.S. Equal Employment Opportunity Commission (“EEOC”) announced the publication of revised guidelines for both employers and veterans regarding the Americans with Disabilities Act (the “ADA”).  The new publications address changes to the ADA’s definition of the term “disability”, which was broadened under the ADA Amendments Act of 2008 to include, among other conditions, a wider range of military service related disabilities such as traumatic brain injury and post-traumatic stress disorder.  Before the amendments, the ADA’s definition of the term “disability” had been construed narrowly, significantly limiting the law’s protections.

With large numbers of veterans returning from service in Iraq and Afghanistan, attention is now being focused on veterans’ challenges in obtaining and successfully maintaining civil employment.  According to the EEOC, approximately “25 percent of recent veterans report having a service-connected disability, as compared to about 13 percent of all veterans.”  And, as reported by the Bureau of Labor Statistics in October, unemployment for post-9/11 veterans hovers around 12 percent, which is more than three percentage points higher than the overall unemployment rate.  The EEOC wants “veterans with disabilities to know that the EEOC has resources to assist them as they transition to, or move within the civilian workforce,” said EEOC Chair Jacqueline A. Berrien.

The Guide for Veterans answers questions about an injured veteran’s rights when returning to civilian life and explains the kind of work adjustments or reasonable accommodations that may help veterans be successful in the workforce.  It explains that, in addition to the ADA protections for disabilities, the Uniformed Services Employment and Reemployment Rights Act (“USERRA”) protects veterans from discrimination on the basis of their military status.

The Guide for Employers explains how the ADA applies to recruiting, hiring, and accommodating veterans with disabilities and differentiates the protections available to veterans with disabilities under the ADA from the protection afforded to veterans under USERRA from discrimination in employment.  The Employer’s guide provides information on additional laws and regulations that employers may find useful if they decide to make recruiting and hiring veterans with disabilities a priority.

Both guides may be found at the EEOC website at:

http://www.eeoc.gov/eeoc/publications/ada_veterans.cfm http://www.eeoc.gov/eeoc/publications/ada_veterans_employers.cfm

EEOC Discrimination Charges Reach Record High

By: Aaron M. Moyer

According to the EEOC’s recently released statistics, the Commission received a record number of new employment discrimination charges last year.  For fiscal year 2011, the Commission received 99,947 charges of employment discrimination.  The Commission also obtained $455.6 million in relief, another record high.  This is a $51 million increase from the previous year and continues the upward trend of the past three years.

The statistics provided by the EEOC offer employers some guidance on the hottest issues before the Commission right now:

• Charges alleging retaliation under all of the statutes enforced by the EEOC were the most numerous, accounting for 37.4% of all charges.
• The agency’s enforcement of disability claims under the ADA resulted in a total of $103.4 million of the total $455.6 million obtained.
• The most common alleged disabilities were back impairments, orthopedic impairments, depression, anxiety disorder and diabetes.
• 2011 was the first full fiscal year of the EEOC’s enforcement of the Genetic Nondiscrimination Information Act (GINA).  Only 245 GINA charges were filed, none of which proceeded to litigation.

According to EmploymentLaw360, in a January 2012 speech to the New York State Bar Association, EEOC Commissioner Chai Feldblum discussed the growing number of EEOC cases alleging ADA violations in the service sector, particularly the healthcare and restaurant industries.  The Commissioner cautioned employers in specific areas: one-size-fits-all attendance policies, medical questionnaires that are unrelated to the job at hand, and rescinding job offers strictly on the basis of disability.  h/t Employment Law 360 (http://www.law360.com/employment/articles/303314?nl_pk=6f740239-75f3-4574-ac7d-3486fe3ce6dd&utm_source=newsletter&utm_medium=email&utm_campaign=employment)

The EEOC’s complete statistics can be found at http://www.eeoc.gov/eeoc/statistics/enforcement/index.cfm.