EEOC Releases Updated Guidance on Use of Conviction Records
Today, the Equal Employment Opportunity Commission (EEOC) released the first updates in nearly 25 years to its guidelines on when and how employers may inquire into an applicant’s arrest and conviction history. According to the EEOC, the new Guidance clarifies and updates the EEOC’s longstanding policy concerning the use of arrest and conviction records in employment, which will assist job seekers, employees, employers, and many other agency stakeholders. Our preliminary analysis confirms that the Guidelines do not appear to represent a fundamental shift in the EEOC’s positions, but rather summarize pre-existing guidelines and principles based on applicable case law and available demographic research.
The EEOC’s Updated Guidance
No federal law explicitly prohibits employers from so inquiring into an applicant’s past criminal history, however, court decisions and EEOC guidelines have previously recognized that, in some cases, disqualifying an applicant because of an arrest or conviction record could violate the Civil Rights Act of 1964, as amended (Title VII), which prohibits employment discrimination based upon race, color, religion, sex and national origin. The updated Guidance notes that the use of criminal history may violate Title VII in one of two ways. First, Title VII may be violated when an employer treats criminal history information differently for different applicants or employees, based on their race or national origin (i.e., disparate treatment liability). Second, a violation may occur where an employer’s facially neutral policy of excluding applicants from employment based on criminal history disproportionately impacts African American and/or Hispanic applicants and is not job related and consistent with business necessity (i.e., disparate impact liability).
The Guidance distinguishes between the use of arrest and conviction records. According to the EEOC, an employer’s reliance on an arrest record in and of itself is not job related and consistent with business necessity because the fact of an arrest does not establish that criminal conduct has occurred. However, an employer may make an employment decision based on the conduct underlying an arrest if that conduct makes the individual unfit for the position in question. The EEOC further recognizes that a conviction record in most cases will usually serve as sufficient evidence that an individual engaged in particular conduct, but notes that in certain circumstances there may be reasons why an employer should not rely on a conviction record alone.
The Guidance cites to nationwide statistical data showing that African American and Hispanic individuals are arrested and convicted at a rate 2 to 3 times their proportion of the general population and states that this nationwide data provides a basis for EEOC to investigate an employer’s use of criminal records. During an investigation, the EEOC will look to whether the particular employer’s use of criminal history has a statistically significant disparate impact on any protected group.
Once a disproportionate impact is shown, the employer may only avoid liability if it can show that the reliance on criminal history is job related and consistent with business necessity. The revised Guidance sets out two circumstances in which the EEOC believes employers will consistently meet this defense:
- The employer validates the criminal conduct exclusion for the position in question under the EEOC Uniform Guidelines on Employee Selection Procedures; or
- The employer develops a targeted screen that considers at least the nature of the crime, the time elapsed, and the nature of the job. The employer’s policy must also provide an opportunity for an individualized assessment of those people identified by the screen to determine if the policy as applied is job related and consistent with business necessity.
As to the first defense, the Guidance recognizes that in most cases this will not be a viable option because of the lack of currently available studies that could provide a framework for formal validation. For the second defense, the Guidance notes that while an “individualized assessment” is not required under Title VII under all circumstances, the lack of an individualized assessment is more likely to result in a violation.
Best Practices Identified by the EEOC
The Guidance provides several examples of best practices for employers who consider criminal record information when making employment decisions (beyond a recommendation for more training). In general, the EEOC advises employers to eliminate policies or practices that “exclude people from employment based on any criminal record” and to replace them with “narrowly tailored” policies that provide for targeted, individualized screening of specific offenses based on a job’s essential requirements and actual duties. The Commission also recommends that employers keep a record of the justifications and research that supports those policies. Finally, the EEOC suggests that when asking questions about criminal records employers should limit their inquiries to records for which an exclusion would be job related for the position in question and consistent with business necessity.
Conclusion
Background checks remain fraught with potential pitfalls for employers. However, employers should not let those hazards stop them from performing proper due diligence on potential employees, provided that they do so in a targeted and individualized manner that relies only on criminal history in a manner that is consistent with the EEOC Guidance. We will be providing clients with more detailed guidance and training opportunities in the coming weeks on this important update of the EEOC’s views on the use of criminal history records in hiring.
Article written by attorneys Doug Hass and Mike Warner and provided courtesy of Worklaw® Network firm Franczek Radelet.
Plugging the Information Leaks
Forecasters predict that the amount of information companies have to manage will quadruple in the next ten years. Data management and security protocols are a growing risk management concern. Companies need to protect proprietary and confidential information including everything from their latest designs, internal communications, client data, marketing strategies, financial information, and the list goes on. Fact is, every aspect of your operations has information and data attached to it that competitors or worse would love to have access to. What can and should a company do to help manage this ever growing risk?
- Make sure you have cyber-liability and other insurance coverages to cover against these losses.
- Do a complete assessment of the most important risks. Not all are weighed equally. Make sure there is someone fully
responsible for managing each one of those risks. - Make sure you know where the information flows and who has access to it. Chances are, your employees have access to more information than they need to.
- Have protocols surrounding all information devices including servers, desktops, laptops, and mobile devices, video conferencing, online chats, and social media platforms.
- Train your employees on the risk associated with not properly managing this information or data.
- Hire a third party service to check your vulnerabilities.
- Employ today’s technologies to help better manage data. For example, Symantec and Web Sense are the leaders in data loss prevention. Their software is often used to prevent social security and credit card numbers from leaving a company.
- Have protocols around the use of social media. HR That Works members should take a look at the Social Media Training Module and related tools.
- Have clear protocols about people who are telecommuting to work or are third-party vendors.
- Make sure how you manage the departure of terminated or defected employees. Of course, you can have non-compete and confidentiality agreements as well as taking a checklist approach to making sure all equipment, passwords, etc. have been collected. If necessary you can employ counsel to file an injunction against use of any confidential information.
- Don’t forget about low-tech espionage including dumpster divers and the Xerox machine.
These suggestions are just a start. You should conduct an extensive risk management and technology assessment and there are plenty of vendors willing to help you with that effort.
Busted!
These are desperate times and more and more employees are doing desperate things. How do you handle it if someone has been arrested before they were hired or even after they were hired? To begin with, the answer to this question varies on a state-by-state basis. That’s one reason why we encourage you to work with companies like our strategic partner, Global HR Research, because they conduct background checks and give you advice based on jurisdictional constraints. In some states it’s a free-for-all, if you decide not to hire someone because they were arrested, that’s OK. In other states, there is a prohibition against not hiring people because they were arrested. In fact, we know of some government contracts that require employers to hire people with an arrest record (only in America).
“Just how bad is it?” is the next question. Assuming work-related arrests are a legitimate reason for not hiring somebody, how bad was the situation? Did they steal something off a delivery truck? Did they swipe confidential data? Did they get busted smoking pot on the job or off the job? As Cicero famously said, let the punishment fit the crime.
Employers also have to be aware of negligent hiring causes of action where an arrest record was overlooked or not even looked into in the first place. For example, in one case I handled years ago, a nursing facility did not conduct background checks because it was so desperate for attendant. As a result, they hired somebody recently released from Folsom Prison for robbery and rape who, in turn, raped and murdered one of the patients. Of course, they were rightfully sued for millions of dollars. This was simply negligence on their part and doing no background checks at all is one of the greatest risk a company faces. Lastly, if the arrest occurs while in your employ, you’re certainly entitled to do your own independent investigation into the situation to determine if it makes sense to keep the employee on board. The recent fiasco at Penn State provides plenty of examples.
Of course, the smartest move to make in a situation like this is to work both with your attorney and, if it’s an executive, your public relations person.
Important Human Resource Considerations During a Merger or Acquisition
We are witnessing a great deal of M&A activity once again. While tough times produce many wonderful buying opportunities, all come with inherent risks. There are numerous risks you want to audit for from a human resource perspective including:
- How do the cultures of the two organizations different? Peter Drucker claimed that 2 out of 3 M&A’s fail due to cultural reasons. As Dr. Deming taught us, you have to drive the fear out of the situation. Fear that the acquired executives and employees will not respect your ways of doing business and fear on the part of the newcomers that you won’t be considerate of their insights. Great leaders take these fears head-on so that the M&A doesn’t get destroyed by unnecessary dramas.
- You want to look at the best HR practices from each organization. Does one company hire employees better than the other? How do they manage performance or motivate employees? What standards do they set for promotions? How do they manage compliance concerns? What sorts of training programs do they operate? Who has the “best practices”?
- The M&A process implies there will be a culling of the herd. How will you identify who is left off the bus in a way that doesn’t let go of the wrong employee and prevents you from getting sued in the process? Have your criteria for the inevitable layoffs and terminations been reviewed by employment counsel?
- Compensation and benefits is another very important consideration during the M&A process. Inevitably, executives and employees will be paid differently for doing the same or similar work. This will be an excellent time to revisit your compensation and benefit plans and strategies in general. Are you paying competitive salaries and wages? You have to look to the marketplace for that answer. What would you have to hire one of these employees for today? Are you using competitive benefits? As mentioned in previous posts, a dollar spent on benefits versus a dollar spent on compensation has a greater perceived value to employees. Consider this fact at a time when many companies are looking to shed benefits. Lastly, what can you learn from each other’s incentive programs? What boosts sales or productivity?
HR should be instrumental in making sure the “soft stuff” is addressed during the M&A process. HR That Works Members have access to an entire M&A audit that they should consider using during such a process.
HR at Risk
In this 5-minute video HR That Works president, Don Phin, discusses the reason why HR is high risk. To download the 149 Things to Worry About in HR PDF, please click here.
Making Their Day
We were fortunate to have Cindy Ventrice, author of Make Their Day: Employee Recognition That Works, conduct a webinar for us on Low Cost Recognition Strategies. It is archived on HR That Works in both WMV and MP3 versions. Here are some of the salient points made:
- The most important recognition comes directly from the manager or supervisor.
- The most impactful recognition is no cost praise.
- Employees like time off as a reward.
- Come up with some fun ideas with your management team. Learn from each other!
HR That Works Members should also look at the Keeping Great Employees Training Module.
Hostile Environments
In the recent case of Mustafa Rehmani v. Ericsson, Inc., the court introduced the facts as follows:
“Petitioner Rehmani, a Muslim born in Pakistan, worked as a System Test Engineer for Ericsson from February 2007, when Ericsson acquired Rehmani’s prior employer, to November 13, 2009, the day he was terminated. During his tenure at Ericsson he had coworkers from at least 12 different countries, including India, China, and Pakistan. Three of those coworkers — Amit Patel, Aneel Choppa, and Ashit Ghevaria — originally were, along with Ericsson, the objects of the underlying lawsuit in this case.” As the case then explains Rehmani claimed the Indian dudes pretty much treated the Pakistanis, Chinese and other non-Indians as second class citizens. From there the facts are like any other “traditional” discrimination case. I recently reported on a case filed the EEOC against an oil refinery because they hired Hispanics over both African Americans and Whites.
Here’s my point: Discrimination is no longer by the black and white thing. It’s growing as a nationality thing. Many immigrants have different cultural views related to the subject and may have long standing rivalries brought to our shores. The solution: Know your legal obligations, be clear about what you won’t tolerate and realize all of us could use a bit of training!
