The Equal Employment Opportunity Commission (EEOC) has issued an updated Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions under Title VII. That Guidance, which takes effect immediately, is a compilation of the past policy documents and prior court decisions regarding the EEOC’s position that employers’ reliance on arrest and conviction records may have a negative impact on individuals because of race or national origin. According to the Guidance, Title VII violations may occur during background checks in two ways: (1) “disparate treatment,” when employers treat applicants/employees differently, making distinctions between employees of different races based on the employer’s subjective judgment as to the relative severity of past convictions; and (2) “disparate impact,” when an employer’s neutral background check policy or practice disproportionately affects individuals in a protected category. The Guidance focuses largely on "disparate impact" type discrimination.

When viewing an employer’s decision for disparate impact, the EEOC first identifies the policy or practice causing the alleged disparate impact. The EEOC then has the burden of showing an actual disparate impact on a protected group, using statistical evidence. Employers should be prepared for increased requests from the EEOC for applicant and hiring data on this account. Once the EEOC has established the existence of a disparate impact, the employer may assert an affirmative defense stating that its background policy or practice is job related and consistent with business necessity. Importantly, the EEOC reiterates in the Guidance a position that it has put forth in numerous past cases, that an arrest, without more, can never be “job-related and consistent with business necessity” because an arrest does not establish that criminal conduct has occurred. Under our criminal justice system, individuals are presumed innocent until proven guilty, and an arrest does not necessarily lead to a conviction establishing guilt. Therefore, employers should not make hiring decisions based solely upon arrest records.

The EEOC identifies two circumstances in which an employer can establish the "job-related and consistent with business necessity" defense. The first requires a validation study or an analysis of criminal conduct as related to subsequent work performance or behaviors, an esoteric standard which most private employers will not readily be able to meet. The second, however, is more accessible, although more time consuming and effort intensive. It involves a “targeted screening process’ for all applicants that sets parameters for the nature and gravity of offenses or conduct; the amount of time that has passed since the offense, conduct, and/or completion of the sentence; and the nature of the job held/sought. Once a group of applicants has been screened using these factors, each of those applicants then should be allowed an individualized review of his or her specific criminal background issue. The Guidance establishes a de facto requirement for individualized screening of applicants and candidates by stressing that an employment screening process that does not include individualized assessments is more likely to violate Title VII.

In its general “Best Practice” summary, the EEOC lists only two points. The first, an instruction to “train managers, hiring officers, and decisionmakers about Title VII and its prohibition on employment discrimination” will be familiar to employers as something that HR and legal advisors typically suggest. The second point, however, a directive to “eliminate policies or practices that exclude people from employment based on any criminal record,” is more problematic. According to Jay Glunt, shareholder in Ogletree Deakins’ Pittsburgh office, this one-line directive is certain to raise some concern among employers, especially in light of recent developments in “Ban-the-Box” legislation in various states and municipalities. Without additional guidance and detail, this statement indicates that the EEOC will not look favorably on any exclusionary policies, whether or not legislatively precluded. Therefore, employers must assure that any exclusion of applicants on the basis of criminal background is clearly “job-related and consistent with business necessity” to avoid negative attention from the EEOC.

The EEOC has posted a Question & Answer summary of the Guidance for public view.