Allied Van Lines Criminal-Record-Bias Case Sparks Questions

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By Patrick Dorrian

Aug. 30 — A lawsuit by two former employees of a local mover against Allied Van Lines and a related company raises novel issues under New York state’s prohibition of criminal-record-related employment bias, the U.S. Court of Appeals for the Second Circuit ruled ( Griffin v. Sirva Inc. , 2016 BL 282025, 2d Cir., No. 15-1307, 8/30/16 ).

It’s unclear whether the New York State Human Rights Law provision covering criminal conviction discrimination applies only to “employers” and how the scope of the term “employer” should be defined, the federal appeals court said Aug. 30, certifying questions to the state's highest court. It's also unclear whether a party can be liable for such bias under the statute’s separate “aiding and abetting” discrimination provision, the court said.

A lower court decided that Allied and Sirva Inc. weren’t Trathony Griffin’s and Michael Godwin’s “employer” and dismissed their claims against the companies. The two men have both been designated “sexually violent offenders” after serving time for sex crimes and were working for a local moving company that had an agency contract with Allied, the court said.

Criminal record checks were required by Allied under the contract, and Griffin and Godwin were fired when their convictions were uncovered during background checks by a third-party vendor retained by Sirva Worldwide Inc.

Employers Need Guidance

The case is important from a business perspective because companies operating in New York state need to know whether they can conduct criminal background checks on workers and job applicants, the types of checks they can conduct, how any information collected can be used and the extent of their potential liability for employment bias if they fail to comply with legal requirements.

More broadly, the case could have implications in other states and locales that have laws similar to New York’s.

From a civil rights perspective, the issue of employment opportunities for formerly incarcerated individuals, and whether criminal record checks have a disparate impact on blacks and other minorities, has been receiving national attention for several years.

It is an area of focus for the Equal Employment Opportunity Commission, and the Obama administration announced April 29 the establishment of a Federal Interagency Reentry Council to lead the federal government’s work on the rehabilitation and reintegration of individuals returning to their communities from jails and prisons.

Approximately 70 million Americans have some kind of criminal record, according to the Justice Department.

New York Law ‘Too Undeveloped.’

Writing for the Second Circuit, Judge Rosemary S. Pooler said judicial interpretation of New York Executive Law Section 296(15) “is too undeveloped” for the appeals court to predict how the New York Court of Appeals would resolve any of the three questions it identified as crucial to a ruling on Griffin’s and Godwin’s discrimination claims against Allied and Sirva.

Sirva is a holding company of Sirva Worldwide. Sirva Worldwide is the parent company of North American Van Lines Inc., which itself became the parent of Allied when the two companies merged in 1999. Sirva formerly traded on the New York Stock Exchange but has been privately held since 2002.

Griffin and Godwin worked for Astro Moving and Storage Co. Some 70 percent to 80 percent of Astro’s business involves working on projects for Allied, according to the opinion.

Allied nevertheless states that it doesn’t share employees, management or common ownership with Astro and has no control over the separate entity’s local moving business. It also maintains that it doesn’t have authority to choose whom Astro hires, to decide how much that company pays its workforce or to discipline Astro employees. Nor is Allied responsible for paying, scheduling or supervising Astro workers, Allied said.

New York courts haven’t indicated whether the balancing tests used to determine “employer” status in other contexts also apply to the state’s criminal-status-bias prohibition, Pooler said. “There is also reason to believe that the definition of ‘employer’ could be broader” under Section 296(15), she wrote.

It’s also possible that an agency contract like the one between Astro and Allied would be enough to trigger aider or abettor liability under Section 296(6), if that provision of the state Human Rights Law extends to the criminal-status-bias protections of Section 296(15) of the law, Pooler said.

Judges Peter W. Hall and Susan L. Carney joined the opinion.

Lichten & Bright P.C. represented Griffin and Godwin. George W. Wright & Associates LLC represented Allied and Sirva.

To contact the reporter on this story: Patrick Dorrian in Washington at pdorrian@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

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