On June 11, the U.S. Equal Employment Opportunity Commission (EEOC) filed suit against BMW and Dollar General for violating Title VII of the Civil Rights Act by using criminal background checks that caused a disproportionate number of African American employees to be fired or screened out from employment.

BMW's challenged policy for screening criminal records had no time limit, as opposed to a typical limit of seven years for reporting convictions. The EEOC said the policy was a “blanket exclusion without any individualized assessment of the nature and gravity of the crimes, the age of convictions, or the nature of the claimant's respective positions.”

In the last two decades, there has been an increase in the number of Americans who have been involved with the criminal justice system. According to the EEOC, at the end of 2007, 3.2 percent of all adults in the U.S. were involved in a parole program or were incarcerated. The rates are higher for black and Hispanic men. Understandably, this trend has had an impact on the number of workers who have a criminal record. According to a recent survey reported by the EEOC, a total of 92 percent of employers use some version of a criminal background check with their employees.

The EEOC published a document that employees may use as guidance when contemplating the use of criminal background checks in the application and retention process.

Disparate treatment

The EEOC identifies several kinds of evidence that could be used to establish an employer's liability for using race, national origin or other protected status as a motivation for using criminal records including:

• Biased statements that express “group-related” stereotypes about criminality
• Inconsistencies in the hiring process, i.e., an employer requesting criminal information more often for individuals belonging to certain racial or national groups
• Statistical evidence showing that an employer uses criminal record information more heavily for a protected class

Disparate impact

The EEOC reported that national data supports the finding that criminal record inquiries have a disparate impact based on race and national origin. If an investigation ensues, employers can combat a claim of disparate impact by demonstrating that protected classes are not arrested or convicted at a disproportionately higher rate in the local area. However, simply using evidence of a racially balanced workplace will not be sufficient to disprove a disparate impact claim. Furthermore, if the EEOC investigates an employer for a Title VII violation, it will consider whether the employer has a reputation in the community for discriminating based on criminal records and whether this practice has an impact on applicant data.

After the plaintiff establishes a prima facie case of discrimination, the burden shifts to the employer to show that the discriminatory practice is job-related and consistent with business necessity. The “Green factors” can be used to assess whether the exclusion is job-related and consistent with business necessity. The factors include: the nature and gravity of the offense, time passed since the offense and the nature of the job.

Arrest records

Arrest records are not definitive proof of criminal conduct. If an employer wishes to use an arrest record, it must do so on a fact-sensitive basis to determine if the conduct underlying the arrest permits adverse employment action.

Job-related and consistent with business necessity

The EEOC recognizes two circumstances in which an employer can meet the requirement that a practice be job-related and consistent with business necessity. First, the employer can validate the criminal record procedure for each position using the Uniform Guidelines standards if there is available data about criminal conduct and subsequent work performance. Second, an employer may develop a target screen considering the Green factors, which allows for an individualized assessment of employees.

Employers should take care to ensure that policies pertaining to criminal records follow EEOC guidelines and can be documented as job-related and consistent with business necessity. This can be accomplished using the Green factors to determine an appropriate policy for each individual position in order to avoid Title VII violations based on disparate treatment or disparate impact.

The EEOC Enforcement Guidance on Consideration of Arrest and Conviction Records in Employment Decisions can be found here.