JACKSON LEWIS

1. JACKSON LEWIS The Use of Arrest And Conviction Records in Making Employment Decisions Presented By: Christopher E. Hoyme Jackson Lewis P.C. March 26, 2014

2. Why conduct background checks? • To safeguard the public. • To avoid litigation and liability. • To minimize risks to other employees in the workplace. • To make sure you are hiring the best person for the job.

3. Minimize Risks • Workplace Violence • The Workplace Violation Research Institute estimates that business owners nationwide lose $36 billion annually from the effects of workplace violence. • Workplace Violence could lead to legal liabilities. • OSHA states employers have a legal obligation to provide their employees with a place of employment that is “free from recognized hazards that are causing or are likely to cause death or serious physical harm to employees.” • Hostile Work Environment claims can be made due to severe or ongoing workplace violence issues.

4. Hire the best person for the job • 49% of hiring managers surveyed by careerbuilder.com have caught candidates lying on their resumes • Most common resume lies: • Dates of employment; • Academic degrees; • Graduation dates; • Performance numbers; • Salary; • Job titles; • Technical abilities; • Language fluency; • Grade point averages.

5. Social Networking Sites • MySpace • 1 billion page views per day • 100 million registered users • Facebook • 54 billion page views per month • 47 million registered users • 85% of students at participating universities have a profile registered on Facebook, and 60% of those students log in to their profiles daily. • Over 77% of employers uncover information about candidates online, and 35% have eliminated candidates based on information they have uncovered.

6. Potential Pitfalls • Discrimination • Background check may reveal information about a protected class. • Race, sex, religion, ethnicity, age, etc. • Employee may allege that background check has a discriminatory “disparate impact” on a protected class. • Discrimination may exist when a protected class is implicated.

7. Potential Pitfalls • Americans with Disabilities Act • Background checks may uncover information about a disability. • Past Drug or Alcohol Use • Mental Health or Psychiatric conditions • Other medical conditions • Cannot base hiring decision on the fact that an individual has a disability. • Cannot ask the individual about the disability. • Can ask whether or not the person can perform the essential functions of the position with or without a reasonable accommodation.

8. Potential Pitfalls • Fair Credit Reporting Act (FCRA) • Applies to credit reports and background checks used for employment purposes. • Requires the employer to get the individual’s written consent. • Requires clear and accurate notification. • Applicants must also be given notice if a credit report will be used in making an unfavorable hiring decision. • Applicant must also get a copy of their report and a statement of their rights.

9. Retail Industry • % of Companies Who Conduct Background Checks • What Department is Responsible for Managing Background Checks? • On What Type of Jobs Are Background Checks Conducted?

10. EEOC SystemicDiscrimination • “A practice or policy that has a broad discriminatory impact on an industry, profession, company or geographic area” • Major areas of focus for the EEOC • ADA • Hiring/Adverse Impact • Recent Cases • Enforcement

11. Background Checks: Watch Out for This Hot-Button Issue • EEOC focus on employer use of flexible criteria to disqualify job applicants based on: • Criminal History • Credit History • Educational Background • Unemployment • EEOC launching “systemic investigations” targeting hiring policies and practices with blanket exclusions, citing adverse impact on members of protected classes • Significant rise in EEOC and private class action litigation

12. EEOC Guidance on the Use of Arrest and Conviction Records • Stepped-up EEOC and private class action litigation challenging blanket “no criminal history” policies • Recent EEOC large settlements with employers • New EEOC guidance

13. EEOC Guidance on the Use of Arrest and Conviction Records • The Guidance lists possible topics of consideration in an individualized assessment, all of which generally require a dialogue • The facts and circumstances surrounding the offense • The number of offenses for which the individual was convicted • Age at time of conviction or release from prison • Evidence that the individual performed the same type of work, post-conviction, with the same or a different employer, without incidents of criminal conduct

14. EEOC Guidance on the Use of Arrest and Conviction Records • The length and consistency of employment history before and after the offense • Rehabilitation • Employment or character references and other information regarding the individual’s fitness for the particular position • Whether the individual is bonded • If the individual does not respond to the employer’s inquiries, the employer may make its decision without the information

15. Recent Case Law Interpreting EEOC Guidance • Adams • Welch • Freeman

16. . . . Follow the 3 Golden Rules: • Conduct the same investigation on every applicant for the same or similar positions • Tailor background checks to legitimate business interests • In enforcement of policies and practices Uniformity Legitimacy Consistency

17. Presented by: Christopher E. Hoyme hoymec@jacksonlewis.com 10050 Regency Circle, Suite 400 Omaha, Nebraska 68114 (402) 391-1991 www.jacksonlewis.com