Douglas Ehlke Douglas Ehlke

Job-Application Inquiries On Criminal Convictions

October 1, 2012

The Federal Equal Employment Opportunity Commission (EEOC) has approved new guidance on criminal-conviction background checks. It urges employers to reexamine conviction inquiries on job applications, and issues new guidelines called “Enforcement Guidance On The Consideration Of Arrest and Conviction Records in Employment Decisions,” effective as of April 25, 2012.

Considering criminal history is unlawful unless the employer can prove that its policy is narrowly tailored, job-related and consistent with business necessity. Employers must prove affirmatively, if compliance-audited, that their policies are justified by specific needs of the business and are job-related.

The EEOC’s actions come in response to a reported significant increase in the unemployment rate for people with criminal records, especially among minorities. The Commission, in a 4-to-1 vote, concluded that an employer’s neutral policy (excluding applicants from employment based on certain criminal conduct) may disproportionately impact some individuals protected under Title VII, and may violate the law if not job-related and consistent with business necessity (disparate impact liability). The Commission based its conclusion on “national data” which reportedly finds that criminal-record exclusions have disparate impact based on race and national origin. The national data provides a basis for the Commission to investigate Title VII disparate impact charges challenging criminal record exclusions.

To determine impact, the Commission primarily compared prison arrest/conviction population statistics to general population percentages of race and national origin. Its report cited these government statistics and described what it might take for an investigated employer to counter them:

“Nationally, African Americans and Hispanics are arrested in numbers disproportionate to their representation in the general population. In 2010, 28 percent of all arrests were African American even though African Americans only comprise approximately 14 percent of the general population. In 2008, Hispanics were arrested for federal drug charges at a rate of approximately three times their proportion of the general population. Moreover, African Americans and Hispanics were more likely than Whites to be arrested, convicted, or sentenced for drug offenses even though their rate of drug use is similar to the rate of drug use for Whites.”

African Americans and Hispanics also are incarcerated at rates disproportionate to their numbers in the general population. Based on national incarceration data, the U.S. Department of Justice estimates that 5.9 percent of the white men in the United States are expected to go to prison at some point during their lifetime. This rate climbs to 17.2 percent for Hispanic men and 32.2 percent for African American men.

The data supports a finding that criminal-record exclusions have a disparate impact based on race and national origin, and provides a basis for the Commission to further investigate such Title VII disparate impact charges. During an EEOC investigation, the employer also has an opportunity to show, with relevant evidence, that its employment policy or practice does not cause a disparate impact on the protected group(s).

For example, an employer may present regional or local data showing that African American and/or Hispanic men in the employer’s geographic area are not arrested or convicted at disproportionately higher rates. An employer also may use its own applicant data to demonstrate that its policies or practices did not cause a disparate impact. The Commission will assess relevant evidence when determining disparate impact, including applicant flow information maintained pursuant to the Uniform Guidelines on Employee Selection Procedures, workforce data, criminal history background-check data, demographic availability statistics, incarceration/conviction data, and/or relevant labor-market statistics.

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.”

Presumptions of impact must be overcome by specific need and localized data of an employer’s applicant pool population, showing there is no disparate impact on black and Latino job applicants whenever a challenged employer excludes applicants on the basis of conviction records. The Commission based its new guidance on these two groups of minorities being over-representative in the prison population when compared to general population statistics.

How can this EEOC presumption of disparate impact be overcome? There are two separate methods where the Commission recognizes that employers can utilize criminal-conviction data and still meet the “job related and consistent with business necessity” defense:

Statistical validation, where the employer can validate the criminal conduct exclusion for the position in question in light of the Uniform Guidelines on Employee Selection Procedures (if there is data or analysis about criminal conduct as related to subsequent work performance or behaviors);

Individualized assessment, where the employer develops a targeted screen considering at least the nature of the crime, the time elapsed, and the nature of the job. On this individualized screen, the Commission commented that, “The employer’s policy then provides an opportunity for an individualized assessment for those people identified by the screen, to determine if the policy as applied is job related and consistent with business necessity. (Although Title VII does not require individualized assessment in all circumstances, the use of a screen that does not include individualized assessment is more likely to violate Title VII.)”

Complicating this Federal policy guidance would be state laws, some of which also restrict evaluation of applicants’ criminal conviction. Massachusetts and New York have such laws.

This new Federal guidance should trigger employers to review their job application inquiry of criminal convictions. Please e-mail me if you want a copy of the EEOC’s new 46-page guidance document. MF
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