Employee Applicants and Criminal Background Checks

On Behalf of | Apr 29, 2015 | Corporate Law

For most small and medium-size businesses, it’s a common-sense practice to ask potential employees, generally on the employment application, about criminal arrests and convictions. But recent guidance and litigation from the federal Equal Employment Opportunity Commission (EEOC) suggests that a blanket prohibition on hiring anyone who has a criminal arrest or conviction is discriminatory, and may open the employer up to liability after a costly and time-consuming investigation.

The rationale for this guidance, according to the EEOC, is that even a facially neutral policy against hiring anyone with a criminal background will necessarily disproportionately screen out racial minorities. If minorities are arrested and incarcerated with greater frequency than Caucasians, then a policy that automatically disqualifies applicants on the basis of arrests and convictions will therefore disproportionately screen out minority applicants.

Instead of a blanket policy, the EEOC advises, employers should ask applicants about previous arrests and convictions and then give the employee the opportunity to explain the arrest or conviction. Employers should then evaluate whether or not the arrest or conviction would preclude the employee from successful employment considering at least three factors: the nature of the job; the nature and seriousness of the offense; and the length of time since the arrest or conviction occurred. Employers should take special care to ensure that employment decisions are not made on the basis of arrest history alone, as an arrest does not necessarily indicate that the applicant was guilty of the charge.1

Employers who fail to give every applicant individual consideration in light of these factors run the serious risk of a time-consuming and very costly EEOC investigation and possible lawsuit by either a rejected applicant or the EEOC itself. Recently, for example, the EEOC has filed a federal lawsuit against both Dollar General Stores, Inc. and a US-unit of BMW AG, the German automobile manufacturer.2 In both those cases, the EEOC alleges that blanket policies rejecting applicants disproportionally affected racial minorities. In the Dollar General case, for example, of the 344,300 employee applicants whose backgrounds were checked, 25%, or 86,075 were black. Of the 26,700 applicants rejected from employment because of their criminal background, 31% were African-American. Here, the EEOC alleges the policy has unfairly discriminated against African-Americans, because although only 25% of the total applicants were black, 31% of the rejected applicants were black.

This new and complicated policy is another reminder that our business clients must be diligent to carefully follow employment laws and regulations. Please contact us to discuss your current employment practices to ensure that they are in compliance with this and other federal and state laws, and for assistance in preparing defensive policies.

1Pre-Employment Inquiries and Arrest & Conviction Fact Sheet; U.S. Equal
Employment Opportunity Commission, available here.

2Thurm, Scott. “Employment Checks Fuel Race Complaints.” The Wall Street Journal, June 12, 2013: Page 1-2. Print.