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Criminal Records Restrictions

​HOW AND WHEN companies can request and use a person’s criminal record information during the hiring process is highly regulated at every level of government. Not only do federal, state, and local laws and regulations covering these activities sometimes conflict, but they have also been in flux in recent years. Employers must stay abreast of changes in these ex-offender protection laws and make sure that they adhere to any restrictions being mandated. Employers that fail to do so could end up the defendant in a legal action brought either by an allegedly aggrieved party, a state administrative agency, or the Equal Employment Opportunity Commission (EEOC), which has oversight and enforcement authority in this area.

Federal Actions
In June 2013, the EEOC filed two new lawsuits involving background screening—one in South Carolina and one in Illinois. The lawsuits allege that the employers discriminated against employees through criminal-background-check policies. According to the EEOC’s announcement, the lawsuits are “the latest in a series of systemic cases the commission has filed to challenge unlawful hiring practices.”

The lawsuits come on the heels of guidance issued by the EEOC in April 2012. The guidance, titled Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964, provides an interpretation of the existing law. The guidance recommends that a background-screening program should be linked to a specific job function. This means that an “employer needs to show that the policy operates to effectively link specific criminal conduct and its dangers with the risks inherent in the duties of a particular position.”

An employer may deploy a “targeted screen” based on three conditions—the nature and gravity of the offense, the time that has passed since the offense, and the nature of the job. The guidance adds some details in describing how these factors should be used, but most importantly, it takes the position that an “individualized assessment” should be made by an employer in virtually all instances before the employer disqualifies an individual based on past criminal conduct. The guidance sets out several specific factors for an employer to consider in this assessment, including the facts or circumstances surrounding the offense, age at the time of conviction, the length and consistency of the employment history, rehabilitation efforts, and education and training. Employers should also consider evidence that the individual has performed the same type of work, post-conviction, with no known incidents of criminal conduct.

If an employer conducts an individualized assessment, the guidance suggests that the employer inform the applicant that he or she may be excluded based on the past criminal conduct and provide the individual with the opportunity to establish that the exclusion should not apply.

The guidance recognizes that some state and local laws may restrict or prohibit the employment of individuals with records of certain criminal conduct. However, in the EEOC’s view, federal law preempts state and local laws. As a result, the EEOC takes the position that if an employer’s exclusionary policy or practice is not job-related and consistent with business necessity, the fact that it was adopted to comply with a state or local law or regulation will not shield the employer from liability.

The EEOC’s updated guidance concludes with recommended best practices. The guidance urges employers to create a “narrowly tailored written policy and procedures for screening for criminal records.” In keeping with the best practices, employers must identify essential job requirements and the “actual circumstances under which the jobs are performed,” determine the specific offenses that may demonstrate unfitness for performing such jobs, and determine the duration of exclusions for criminal conduct, including an individualized assessment. The EEOC further recommends recording the justification for the policy and procedure, providing related training and education to managers, and maintaining criminal record information in a confidential manner.

State Laws
As noted, some states are enacting new laws that make it discriminatory for a company to refuse to hire ex-offenders in certain circumstances. Other states are taking steps to protect companies from the actions of ex-offenders once hired.

California, Massachusetts, New York, and Wisconsin already extend protections to ex-offenders. A new law passed this year makes it illegal for Indiana employers to discriminate against ex-offenders, including refusing to employ any person who has had his or her conviction or arrest record expunged or sealed as allowed by law. Employers that seek criminal history information from candidates are prohibited from inquiring about expunged convictions or arrests. In addition, effective December 2013, North Carolina employers will no longer be able to inquire on the employment application, during an interview, or “otherwise” about any criminal record that has been expunged.

In September 2013, Texas joined a handful of states that afford employers a measure of protection against tort claims arising from misconduct by an ex-offender. The Texas law will preclude civil suits against an employer for negligent hiring or failing to adequately supervise an ex-offender based on evidence of the ex-offender’s prior conviction.

The protections of the new Texas law will not apply in two circumstances. First, with regard to suits against an employer concerning the misuse of funds or property, the protections will not be available to the employer if the ex-offender was hired for a position with fiduciary responsibilities in the management of funds or property and, at the time of hire, the ex-offender had a prior conviction for a crime that involved fraud or the misuse of funds or property. Second, and more generally, the protections will not apply if the employer knew or should have known of the prior conviction, and the prior conviction involved a specified sexual or violent offense or the crime was committed while performing duties “substantially similar” to those reasonably expected to be performed in the employment.

City Statutes
Action at the local level has generally involved “ban the box” initiatives. This term refers to the box that applicants must check in response to a question on an employment application that asks if they have been previously convicted of a crime.

For example, in May 2013, the city of Buffalo, New York, voted to restrict private sector employers operating in Buffalo from inquiring about criminal history on an employment application. Once the measure takes effect in January 2014, employers with 15 or more employees located in Buffalo will be deemed to have engaged in unlawful discrimination if they make an inquiry about or require any person to disclose a criminal conviction during the “application process,” which begins when the applicant inquires about the employment sought and ends when an employer has accepted an employment application.

The law also makes it illegal for an employer to make any inquiry about a criminal conviction before a “first interview,” which means “any direct contact by the employer with the applicant whether in person or by telephone,” to discuss the employment. Under the Buffalo law, companies retain the ability to request conviction information from an applicant seeking to work in a regulated position. However, in these circumstances, employers must consider eight factors required under New York state law to determine whether the conviction bears a direct relationship to the duties and responsibilities of the position sought.

Seattle, Washington, has also passed a law to limit the use of criminal records for employment purposes; the law is applicable starting in November. Specifically, employers may not advertise, publicize, or implement any policy or practice that automatically excludes all individuals with any arrest or conviction records from employment for a job that will be performed at least 50 percent of the time within city limits. Seattle employers may continue to perform criminal background checks but only after the employer has completed an initial screening of applications or résumés to eliminate unqualified applicants.

Employers may inquire about the conduct related to an arrest record, but they may not carry out a tangible adverse employment action “solely based on” such an arrest record. Before taking any tangible adverse employment action, the employer must identify the records or information on which it is relying and provide the applicant with a “reasonable opportunity” to explain or correct that information. Employers must hold open a position for a minimum of two business days after providing such notice to afford the individual a reasonable opportunity to correct or explain that information.

Employers across the country should consider the EEOC’s best practices when devising a background screening policy. And as the list of state and local laws affording employment-related protections to ex-offenders continues to grow, companies that use a nationwide job application must thoroughly assess whether that application, including questions about criminal records, complies with relevant laws.

Rod M. Fliegel is a shareholder in Littler Mendelson’s San Francisco office. He is cochair of the firm’s new hiring and background checks practice group. He has nationwide experience with the laws that govern employment background checks. Jennifer L. Mora is an attorney in Littler Mendelson’s Los Angeles office. Her practice focuses on representing and advising employers on a wide range of labor and employment issues.