Criminal Background Checks: EEOC Enforcement and Ban-the-Box Update

Labor & Employment Newsletter


The EEOC last year took a new step toward attempting to limit criminal background checks by employers. That was the regulatory guidance we wrote about here: Recently the EEOC filed two well-publicized lawsuits alleging race discrimination against two different employers for using criminal history as a factor in hiring decisions. Also, since we previously wrote, so-called “ban-the-box” efforts have proven successful in several big cities. These are grass-root campaigns to enact laws to prohibit the “have you been convicted of a crime” box on employer job applications. The recent EEOC activities and the ban-the-box efforts are discussed below, followed by renewed words of caution to our clients on this subject.

EEOC Lawsuits

Since issuing the updated criminal background check guidance last year, the EEOC apparently has been looking for some good test cases to file against employers. Clearly, eliminating hiring obstacles is a priority for the EEOC. Two cases were filed this month. The first case is against retail store chain Dollar General Corp. in Illinois. The second one is against auto maker BMW Manufacturing Co. in South Carolina. The cases are similar in that both cases involve revocation of job offers to prospective employees due to results of criminal background checks.

In Dollar General, the EEOC alleges that the company uses a formula for excluding applicants that includes the crime and how old it is but fails to include each applicant's individual circumstances. As a result, applications from black candidates were rejected at a rate several percentage points higher than applications from non-blacks. The EEOC alleges that Dollar General’s policy has a discriminatory impact on blacks as a result.

In BMW, the auto maker changed one of its major subcontractors, and approximately 650 employees with the old sub applied for jobs with the new sub. The new sub screened the former sub’s employees according to BMW’s criminal background policy. Although the previous sub’s employees were about 55 percent black, blacks were screened out under the BMW criminal background policy at a rate of 80 percent. Many of the applicants had held jobs at the BMW facility for many years. The EEOC again alleges that BMW’s policy has a discriminatory impact on black applicants.

Ban-the-Box Efforts

The ban-the-box movement is a nationwide effort to remove the criminal history question (and check box) from employer job applications. Although most agree that the law should not require employers to hire applicants with criminal records in all situations, ban-the-box proponents seek the same result that the EEOC does. That is, the criminal history question should be deferred until later in the hiring process and not be utilized as an automatic bar to employment.

Many states have ban-the-box laws for state jobs, and some counties and municipalities have ordinances that have such laws for private jobs also. Boston, San Francisco, Cincinnati, and Memphis are larger-city examples.

In the jurisdictions that have these laws, specific procedures are laid out. Typically, the question is prohibited on the application itself. If an applicant is considered or referred for employment, the question may be asked at a later stage in the process such as during the job interview. The laws vary about requirements from that point forward, but basically the common idea is that an individualized approach is required. The employer should make some effort to determine whether the conviction involved bears any relationship to the job sought to be filled. Special exceptions often are made for public safety jobs and jobs involving care of children or the elderly.

Thoughts for Employers

The first easy word of caution for employers is to be aware of whether new business activities put your company in a jurisdiction with a ban-the-box law. If so, be careful to follow the requirements and procedures under that law.

Second, in attempting to balance legitimate business needs with the EEOC's new enforcement approach, consider whether the criminal record history question needs to be on the company's job application or whether the question can be deferred to a later stage of the hiring process. Ask about convictions rather than arrests. Then, attempt to consider each hiring decision individually in light of the Green factors that we previously have discussed and that have been adopted by the EEOC. In Green, that court required an individualized assessment considering these factors: (a) the nature of the crime, (b) the time elapsed since the crime, and (c) the nature of the job in question. The employer then should give notice to the excluded person that he or she was excluded because of the criminal conviction and provide an opportunity for that person to show the exclusion should not be applied in his or her situation. A decision not to hire should be based upon some connection between the crime and the job sought to be filled. Our previous article had a good list of factors to consider as to whether a connection could be shown in an individual case.

The difficulty for employers of course is that there are no clear criteria to follow. Normally, having one standard and applying it equally to all no matter the race or other protected class is the safest rule to follow in trying to avoid what are called disparate treatment claims, the most common type of employment discrimination claim. "We don’t hire anyone with a felony conviction within the last seven years" would seem to fit within this safe route because everyone is treated the same. However, the EEOC and various jurisdictions now have taken the position that a blanket no-hire rule based upon convictions can fall within the second type of discrimination claim, so-called discriminatory impact claims. Therefore, to avoid this latter type of claim, an individual assessment is preferable. The irony is that these individual assessments are what lead to claims of discriminatory treatment and scrutiny of each and every individual decision that an employer makes in the first place. Proceed with care!