It is the rare employer or company that has no interest in the criminal background of its prospective or even current employees. One would even go so far as to argue that it makes good common and business sense not to hire persons that have been arrested for, or convicted of, a serious crime, or to terminate an employee upon discovery of a criminal record.

Well, if you have ever felt this way, you might want to think again because the U.S. Equal Employment Opportunity Commission (EEOC)’s recent issuance of its Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., goes some distance in creating potential liability for discrimination by employers for their carte blanche use of criminal record exclusions.

The hallmarks of the Enforcement Guidance, which issued April 25, 2012, and supersedes the EEOC’s previous policy statements on this topic, center around:

1. Describing examples of how an employer’s consideration of a criminal record may lead to liability under Title VII using disparate treatment and disparate impact analyses if part of a claim of discrimination based on a protected status; 
2. Outlining how would-be or prospective employers can craft a criminal background screening process that meets the dual goals of (a) ensuring the safety and sanctity of the work place while meeting legitimate business objectives, and (b) protecting against the discriminatory exclusion of persons from the workforce; and 
3. Providing some “Employer Best Practices” for considering criminal record information when making employment decisions.

Why the Commission is Not So Sure a Thief is Always a Thief — and Why it Cares In the First Instance

The EEOC’s concern about criminal record exclusions stems from its ongoing focus on the hiring process under its E-RACE initiative. E-RACE stands for Eradicating Racism and Colorism from Employment. Its position seems to be that the mere existence of a criminal record without more should not support the wholesale exclusion of otherwise qualified people from the workforce. The Enforcement Guidance also goes into some detail about the lack of overall reliability of criminal records and criminal background checks, and how “arrests” really are not indicative of criminal conduct, may not lead to charges and/or may not lead to convictions in any event.

The recent guidance notes that having a criminal record does not create a protected status under Title VII. Thus, whether a covered employer’s reliance on a criminal record to deny employment violates Title VII depends on whether it is part of a claim of employment discrimination based on race, color, religion, sex, or national origin. Said another way, the claimant must prove that consideration of his/her criminal record resulted in either disparate treatment or disparate impact because of his/her race, color or other protected status.

Disparate Treatment Discrimination on the Basis of Criminal Record

Disparate treatment on the basis of a criminal record in violation of Title VII may result when similarly situated and equally qualified job applicants are treated differently because of racial or ethnic stereotyping about criminality.

For example, let’s say two similarly situated and qualified job candidates with comparable criminal records, one White and one African American, apply for the same position. The African American applicant is denied the position because of his criminal background, while the White applicant is hired notwithstanding an identical criminal record. The new guidance suggests that the decision to reject a job applicant on the basis of racial or ethnic stereotypes about criminality — rather than qualifications and suitability — is unlawful disparate treatment that violates Title VII.

In addition to racial or ethnic stereotyping, employers should be aware of the other kinds of evidence that may be used to establish that race, national origin or other protected characteristics motivated an employer’s use of criminal records in the employment selection decision, including, but not limited to, (1) biased statements; (2) inconsistencies in the hiring process; (3) similarly situated comparators that are like the claimant or charging party, except for membership in a protected group; (4) employment testing and (5) statistical evidence.

Disparate Impact Discrimination on the Basis of Criminal Record

An employer should also be aware of potential liability for disparate impact discrimination resulting from its use of a criminal record in the employment selection process. If an employer has a facially neutral criminal screening policy that is discriminatory in operation, the employer must prove that the policy or practice is job related for the positions in question and consistent with a business necessity.

The EEOC’s guidance breaks down what evidence should be considered in a disparate impact claim of this type.

First, the policy or practice in question is analyzed, including, (1) the text of the policy or practice, associated documentation and details about how the policy or practice was implemented; (2) which offenses or class of offenses were reported to the employer; (3)whether convictions, arrests, charges, or other criminal incidents were reported; (4) how far back in time the reports reached; (5) the jobs for which criminal background screening was done; and (6) any employer-created training or guidance documents on the process of doing criminal backgrounds and how to evaluate the information obtained.

Next, a determination of disparate impact is made using a statistical analysis of national, regional or local data on the rates at which persons in various racial or ethnic groups are arrested or convicted of crimes. Employers should be careful to note that the new Enforcement Guidance seems to suggest that the EEOC’s own review of the national data supports a finding that criminal record exclusions have a per se disparate impact on certain racial or ethnic groups. Of course, the employer can also make a showing that racial or ethnic minorities are not arrested or convicted at disproportionately higher rates in the employer’s particular geographic area using this same or other data, including its own applicant data.

Once disparate impact is established, the burden of production and persuasion shifts to the employer to show that the challenged policy or practice is “job related for the position in question and consistent with business necessity” in order to avoid liability under Title VII. To do this, an employer must present evidence that the policy or practice “operates to effectively link specific criminal conduct, and its dangers, with the risks inherent in the duties of a particular position.”

The EEOC believes employers can prove the necessary correlation under at least two circumstances:

• The employer validates the criminal conduct screen for the position in question per the Uniform Guidelines on Employee Selection Procedures standards; or
• The employer develops a targeted screen considering at least the nature of the crime, the time elapsed, and the nature of the job (the Green factors),¹ and then provides an opportunity for an individualized assessment for people excluded by the screen to determine whether the policy as applied is job related and consistent with business necessity.

Best Practices for Employers

Several best practices for employers are also provided by the Commission. Some of the key best practices include:

• Not asking about convictions on job applications and that, if and when, they 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;
• Eliminating policies or practices that exclude people from employment based on any criminal record; and
• Developing a narrowly tailored written policy and procedure for screening applicants and employees for criminal conduct.

See also the EEOC Q&A About the Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII.

_{1 The Green factors were drawn from Green v. Missouri Pacific Railroad, 523 F.2d 1290, 1293 (8th Cir. 1975), where the court identified three (3) relevant factors to assessing whether an exclusion is job related for the position in question and consistent with business necessity: (1) the nature and gravity of the offense or conduct; (2) the time that has passed since the offense or conduct and/or completion of the sentence; and (3) the nature of the job held or sought.}