Discrimination Challenges to Criminal Background Checks

April 15, 2010

In April 2010, Roberto J. Arroyo filed a class action suit under Title VII of the Civil Rights Act of 1964 (Title VII) against a national management consulting firm, alleging that Latino and African American individuals were denied employment or terminated based on their actual or presumed criminal backgrounds. In his complaint, Arroyo asserts his employer rejected job applicants and terminated employees with criminal records, even where the individuals’ criminal histories had no bearing on their fitness or ability to perform the jobs. Arroyo worked for his employer for 17 months before being terminated based on a prior conviction of vehicular manslaughter in 1997.

Title VII Limits on Criminal Record Use

As this case illustrates, criminal records have become more accessible to employers, resulting in new employment discrimination allegations based on prior arrest and conviction records. While there is no federal statute outright banning criminal history inquiries, (1) statutes in several states prohibit or limit the use of arrest and post-conviction information in employment hiring decisions; and (2) Title VII prohibits an employer from using a facially neutral employment practice that has an unjustified adverse impact on members of a protected class.

The Equal Employment Opportunity Commission’s (EEOC) Policy Guidance on the Consideration of Arrest Records states “arrests alone are not reliable evidence that a person has actually committed a crime,” and prior arrests offer “little, if any, probative value” in showing an individual has engaged in actual misconduct. Therefore, the EEOC has stated that, for an employer to justify the use of arrest records in pre-employment applications, further inquiry must be made. According to the EEOC:

  • Employers should always “examine the surrounding circumstances [and] offer the applicant or employee an opportunity to explain.”
  • Using arrests as a disqualifying criterion “can only be justified where it appears that the applicant actually engaged in the conduct for which he [or] she was arrested and that such conduct is job related….”

Thus, the EEOC concluded “an employer will seldom be able to justify making broad general inquiries about an employee’s or applicant’s arrests.” See EEOC’s Policy Guidance on the Consideration of Arrest Records in Employment Decisions under Title VII of the Civil Rights Act of 1964 (Sept. 7, 1990).

Additionally, the EEOC has published a statement on the use of conviction records in the pre-employment setting. The Commission takes the position that “an employer’s policy or practice of excluding individuals from employment on the basis of their conviction records has an adverse impact on Blacks and Hispanics in light of statistics showing that they are convicted at a rate disproportionately greater than their representation in the population.” Thus, the EEOC has stated that, in the absence of a justifying business necessity, the denial of employment solely based on an individual’s conviction record is unlawful under Title VII. Further, for a successful defense to an individual’s charge alleging an employer failed to hire him or her based on a conviction policy that has an adverse impact on the individual’s protected class, the employer must show it considered the following three factors to determine whether the adverse decision was justified by business necessity:

  • Nature and gravity of the offense or offenses.
  • Time that has passed since the conviction and/or completion of the sentence.
  • Nature of the job held or sought.

See EEOC Policy Statement on the Issue of Conviction Records under Title VII of the Civil Rights Act of 1964 (Feb. 4, 1987).

State Limits on Criminal Record Use

In accordance with the EEOC’s stance on this issue, several states have adopted legislation banning arrest-related inquiries and prohibiting discrimination based on conviction records. For example:

  • In Rhode Island, an employer is expressly prohibited from inquiring into “whether the applicant has ever been arrested or charged with any crime.” See R.I. Gen. Laws § 28-5-7(7).
  • In California, employers are prohibited from asking applicants “to disclose, through any written form or verbally, information concerning an arrest or detention that did not result in conviction.…” See Cal. Lab. Code § 432.7(a).
  • Under Wisconsin law, arrest and conviction records are considered prohibited bases of discrimination, and an employer may only refuse to employ an individual based on a prior conviction if the crime substantially relates to the circumstances of the particular job. See Wis. Stat. §§ 111.321-111.322; 111.335.

Thus, it is critical for prudent employers to stay abreast of the relevant legislation in their jurisdictions.

Practice Tips

Employers are cautioned to look at the degrees of human and economic risks to determine the extent of evidence that they will have to produce to justify use of arrest and conviction records as a selection criterion. The more economic or human risk involved, the less evidence of business necessity required, and vice versa.

Also, in addition to using required federal Fair Credit Reporting Act disclosures and authorization forms, where applicable, employers should consider inserting a brief caveat into their employment applications and company policies regarding the use of arrest and conviction records. For example:

  • “A conviction does not automatically mean you will not be selected. The job for which you are applying, what you were convicted of, and how long ago you were convicted, are important. Please provide all of the facts so that an informed decision can be made.”

In light of the EEOC guidelines and various state enactments, employers should consult counsel to ensure their background check policies and hiring procedures are in compliance – both in form and day-to-day practice.

For additional information, please contact the author or any other member of the McGuireWoods Labor & Employment and Employee Benefits teams.