Gray Areas Remain on Background Checks Under EEOC Guidance, Speakers at ABA Say

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By Kevin P. McGowan  

Nov. 12 --The Equal Employment Opportunity Commission's enforcement guidance on employers' use of arrest and conviction records is not intended to bar criminal background checks but rather to prevent discrimination in how such information is used, EEOC lawyer James A. Paretti Jr. said at an American Bar Association meeting Nov. 7.

Speaking at the ABA Section of Labor and Employment Law's annual conference in New Orleans, Paretti said EEOC developed and issued the guidance in April 2012 to address the realities of the 21st-century workplace, in which more background checks are being conducted in part because of easier access to such information on the Internet (80 DLR A-1, 4/25/12).

The U.S. Court of Appeals for the Third Circuit's decision in El v. SEPTA, 479 F.3d 232, 100 FEP Cases 195 (3d Cir. 2007) (54 DLR AA-1, 3/21/07), in which the court said the EEOC's prior guidance didn't tell the court much and was not persuasive, also motivated the EEOC to update and improve its guidance, said Paretti, a senior counsel to EEOC Commissioner Victoria Lipnic (R).

The “targeted screen” called for in the EEOC's guidance combines the three “Green factors”--consideration of the severity of the offense, the time since conviction or sentence served and the nature of the job at issue--with an “individualized assessment” drawn from New York state law for persons who are rejected because of a criminal record, Paretti said.

The Green factors refer to the decision in Green v. Missouri Pacific Railroad Co., 523 F.2d 1290, 11 FEP Cases 658 (8th Cir. 1975).

An individualized assessment is not required in every case so, for example, a day care center provider can screen out applicants with past convictions for child molestation without the extra step, Paretti said.

The state of Texas's recently filed lawsuit against the EEOC (215 DLR A-1, 11/5/13), which challenges the agency's authority to issue the guidance and asks a federal court to enjoin its enforcement, contends the EEOC cannot preempt state laws requiring exclusion from state jobs of particular criminal offenders, Paretti said. The state law preemption issue is “one that continues to plague EEOC,” he said.

The EEOC guidance is intended “to tell people the best way” to use the information gleaned from background checks in a way that complies with Title VII of the 1964 Civil Rights Act, Paretti said.

Employers Seek Objective Data

Employers use criminal background checks for many reasons, including compliance issues for regulated industries in which persons with particular convictions are barred, licensing requirements, general concerns about workplace conduct and to avoid liability for negligent hiring or retention, said Devjani Mishra, an associate general counsel for global employment with Alexion Pharmaceuticals in Cheshire, Conn.

The “unofficial” reason employers use background checks is that the hiring process involves a “lot of guesswork,” Mishra said. References from past employers have been “watered down” and applicants may inflate their resumes, she said.

Hiring employers “struggle for ways to get objective data” about applicants and background checks offer that promise, Mishra said.

Asked if employer policies have changed because of EEOC's guidance, Mishra said “it depends” as the EEOC “only provides so much guidance” on what and how employers should change.

Danger of Disparate Treatment?

Donald Livingston of Akin Gump Strauss Hauer & Feld in Washington, who moderated the session, asked if the guidance's recommended “individualized assessment” could potentially cause disparate treatment based on race or other protected characteristics.

Sharon Dietrich, a managing attorney with Community Legal Services in Philadelphia, said from her low-income clients' perspective, any exception to an employer's grid of criminal offenses that disqualify applicants from particular jobs, is “fine and good.”

Past criminal record, including arrests, is the most common reason her clients report they either are turned down for jobs or fired once an employer learns about their record, Dietrich said. The EEOC guidance draws a “bright line” that employers should not consider arrests in hiring decisions, Dietrich said, but she said in her experience, employers routinely violate that rule.

Asked if employers need to retain outside experts to structure and perhaps even implement their background check policies, Dietrich said if it's a Fortune 500 company, she would recommend retaining an expert.

The Third Circuit's decision in El is “probably the most important decision in decades” regarding the “business necessity” defense to Title VII disparate impact claims, Dietrich said. That defense essentially is about gauging the risks of hiring or retaining an individual with a past criminal conviction, she said.

More social science research has been conducted recently on whether and when someone with a past conviction is likely to engage again in criminal conduct, Dietrich said. Employers should consult those studies, which generally indicate that after a certain number of years have elapsed since the last conviction, an ex-offender is no more likely to commit a crime than others in the general population, she added.

Effects on Current Employees Discussed

Also speaking on the panel, Richard McCracken, an attorney who represents unions for Davis Cowell & Bowe in San Francisco, said the EEOC guidance doesn't really deal with the situation in which a current employee is arrested.

He asked what the EEOC's position might be if an employer has a policy of discharging employees arrested for traffic violations, for example, but statistics show black and Hispanic workers are disproportionately likely to be stopped for alleged traffic offenses.

Paretti said he doesn't know whether the EEOC has “any hard and fast position” regarding employer policies on discipline for current employees who are arrested. Paretti said, however, an employer policy “that does not provide for any discretion” or individualized assessment of affected employees “would be harder to justify” under Title VII.

McCracken said his union clients “by and large oppose” background checks of current employees. Paretti said a collective bargaining agreement provision on background checks would not necessarily be a defense for an employer or the union if the EEOC believes the policy violates Title VII. McCracken said if the union and employer consciously aim not to discriminate, why wouldn't the EEOC take that private bargaining agreement into account.

“We're not Texas!” McCracken said, suggesting there is a need to accommodate statutory interests under the National Labor Relations Act with those under Title VII.

Dietrich said it's not unusual for current employees to be affected by criminal background checks if an employer changes its policy, a new company acquires the workplace and conducts checks as a condition of rehire, or if a worker placed by a staffing agency is considered for permanent employment.

If a worker in any of those situations has performed the job successfully for a long period of time, Dietrich said she would argue if an employer discovers that worker has a past conviction, the risk of future criminal conduct is low and no “business necessity” would justify that worker's termination

Paretti said he supposes in situations involving current employees, the EEOC again would counsel that employers should look at the Green factors of the severity of the offense, time elapsed since conviction and nature of the job.

Potential Clash for Unionized Employers

McCracken said employers in the union context face a potential dilemma under the EEOC guidance as the National Labor Relations Board tends to favor employers that adhere to “zero tolerance” policies regarding discipline for arrests or criminal records when fired employees claim they were terminated for protected activity. Employers conducting “individualized assessments” could be disadvantaged in the NLRA context, he said.

Paretti said he thinks if an applicant or employee fails to disclose a past criminal record when asked, an employer could take disciplinary action for that lie or omission without running afoul of Title VII.

During a question period, Paretti said public safety organizations, such as police and fire departments, probably have “a lot more leeway” to reject applicants based on past criminal records than other employers. Case law regarding the “business necessity” defense to Title VII disparate impact is “still fairly scant,” Paretti said.

Many employers “feel like they're being challenged by EEOC” to “spend the money and take the publicity hit” in order to develop the law on business necessity, said Livingston.

A former EEOC general counsel, Livingston successfully represented the corporate event planning firm Freeman in defeating an EEOC race discrimination suit regarding the employer's use of criminal background and credit checks (154 DLR AA-1, 8/9/13).


To contact the reporter on this story: Kevin P. McGowan in New Orleans at

To contact the editor responsible for this story: Susan J. McGolrick at

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