The New Frontier: The EEOC’s Recent Criminal Background Guidance

1. Presented by: Garen Dodge | Jackson Lewis | Reston, VA Anne Duffy | American Staffing Association | Alexandria, VA June 6, 2012 The New Frontier:The EEOC’s Recent Criminal Background Guidance

2. EEOC Guidance on Use of Arrest and Conviction Records in Employment The Equal Employment Opportunity Commission approved, by a 4-1 vote, a revised Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions under Title VII. The Guidance was effective on April 25, 2012.

3. Previous EEOC Policy and Guidelines The new Guidance replaces: 1987 EEOC Policy Statement regarding Conviction Records . 1990 Policy Guidance on the Consideration of Arrest Records.

4. Disparate Impact Analyses under the Law • Employer’s neutral policy may disproportionately impact individuals protected under Title VII (disparate impact). • Disparate impact (DI) burden-shifting framework: • Plaintiff(s) or EEOC demonstrates the employer’s facially neutral policy has a statistically significant disparate impact on a protected group. • Burden shifts to employer to demonstrate the policy is job-related and consistent with business necessity (and consistently applied). • Even if the employer proves business necessity, the plaintiff(s) or EEOC may prevail by showing the employer refused to adopt an alternative practice that would satisfy the employer's legitimate interests without having a disparate impact on a protected class.

5. Making a Prima Facie Case through Statistical Evidence • EEOC will seek to make a prima facie disparate impact case through statistical analyses of the employer’s applicant, workforce, and/or third-party background history. • Therefore, expect the EEOC to request applicant and background check data in its investigations: • “The Commission will assess relevant evidence when making a determination of disparate impact, including applicant flow information maintained pursuant to the Uniform Guidelines on Employee Selection Procedures, workforce data, criminal history background check data….”

6. EEOC Knows Applicant and Background Check Data is Readily Available Technology has changed everything -- and EEOC knows it • It is easier than ever before to gather detailed applicant and background check data: • Applicant flow data maintained in ATS. • Background check data maintained by third-party providers. • Applicant and background check data spanning several years and/or covering multiple locations can be run in a single report. This makes it more difficult for employers to argue it is too burdensome to produce the data. • EEOC knows “big numbers are bad numbers”—large data sets are more likely to tip over into statistical significance.

7. Defending DI Claims:Old Guidance Under Title VII, an employer may justify a practice that results in a disparate impact by demonstrating a business necessity for that practice. An employer could demonstrate business necessity under the 1987 Policy by showing it considered three factors in making its decision.

8. 1987 Policy (Green Factors) The nature and gravity of the criminal offense(s). The time that has passed since the conviction and/or completion of the sentence. The nature of the job held or sought.

9. New Enforcement Guidance New Guidance provides examples of an applicant’s or employee’s proper or improper disqualification based on criminal record.

10. Targeted Screens May Satisfy Business Necessity Employer may satisfy its Title VII obligations by using an internal policy if it is “narrowly tailored.” This means a “demonstrably tight nexus to the position in question. The Guidance refers to “targeted screens” that are based on the Green factors but EXCEPTION, NOT BEST PRACTICE.

11. Defending DI Claims The number of offenses for which the individual was convicted; Age at time of conviction or release from prison (point of redemption); Evidence that the individual performed the same type of work, post-conviction, without incidents of criminal conduct; The length and consistency of employment history before and after the offense; Risk of recidivism – Use of social studies.

12. Targeted Screens Accompanied by Individualized Assessment Guidance prefers that targeted screen be accompanied by notice to the individual under scrutiny and an individualized assessment of the individual and the crime and the position in question. Allow the applicant or employee to explain the circumstances of the conviction.

13. Targeted Screens Accompanied by Individualized Assessment • Guidance lists eight possible topics of consideration in an individualized assessment, including: • The facts and circumstances surrounding the offense or conduct; • Evidence that the individual performed the same type of work, post-conviction, with the same or a different employer, with no known incidents of criminal conduct; and • Employment or character references and other information regarding the individual’s fitness for the particular position.

14. Validation Study May Satisfy Business Necessity Guidance allows a validation study on an employer’s use of criminal background information meeting. EEOC appears doubtful that data exists to allow an employer to conduct such a validation study.

15. Arrest Record Requires Inquiry into Conduct Alleged Arrest record standing alone may not be used to deny an employment opportunity. Allows an employer to make an employment decision based on the conduct underlying the arrest if the individual would be unfit for the position because of the conduct.

16. Persons Subject to Federal Prohibitions or Restrictions • Federal laws and regulations prohibit the employment of persons with records of certain crimes in particular positions, for example: • Child care workers in federal agencies; • Bank employees; • Port workers. • Employers may obtain a waiver from these restrictions.

17. State and Local Restrictions Commission’s refusal to allow employers to establish business necessity based on compliance with state or local laws prohibiting the employment of persons with certain criminal convictions. Employer must demonstrate that its policy is job-related and consistent with business necessity based on the Green factors.

18. Other Relevant Points Persons who do not actually apply for employment may have a cause of action against an employer if the potential applicant is “discouraged from applying.” As a “best practice,” the Guidance encourages employers not to ask applicants about their criminal records. Guidance addresses disparate impact on African-Americans and Hispanics, but does not address disparate impact based on sex.

19. Operating in the New Legal Environment Commission accepts criminal background checks as a common employment practice. 92 percent of responding employers utilize criminal background checks. Employers should review the Guidance and evaluate and revise their policies and practices in accordance with the “Best Practices.” EEOC has taken the position that it can expand any individual charge into a systemic discrimination investigation.

20. Guidance Defects EEOC’s Authority to Issue. OIRA (OMB) Review. Congress—Appropriations. Legal Challenge (will courts defer?).

21. Will Courts Follow Guidance? Not 100% clear but even if courts don’t significant potential issues with EEOC before judiciary becomes involved. Courts sometimes bow to EEOC guidance.

22. Questions? Garen E. DodgeJackson Lewis LLPPartner – Washington, D.C. Region Office(703) 483-8323DodgeG@jacksonewis.com Anne M. DuffyAmerican Staffing AssociationAssistant Counsel(703) 253-2020aduffy@americanstaffing.net

23. Thank You! Workplace law. In four time zones and 49 major locations coast to coast.