Workplace Strategies - Early Bird Session - 5/10/12

Transcription

1 Background Checks in 2012: How to Strike the Right Balance Between Not Hiring an Axe Murderer, Not Becoming Big Brother, and Not Running Afoul of the EEOC presented by Phillip J. Strach (Raleigh, NC) Stephen R. Woods (Greenville, SC) 1. Determining Whether a Background Check Can Be Requested 2. Requesting a Background Check 3. Considering and Using Background Check Information 4. Communicating Results Background Check Issues Catch Employers in the Crosshairs Organizations Conducting Criminal Background Checks 92% of employers are conducting criminal background checks on some segment of their employees/applicants Source: Society of Human Resource Management, Background Checking: Conducting Criminal Background Checks (Jan. 22, 2010) 1

2 Organizations Conducting Credit Background Checks 60% of employers are conducting credit background checks on some segment of their employees/applicants EEOC Issues Guidance EEOC s Guidance (issued April 25, 2012) summarizes the EEOC s long-held position that employers reliance on arrest and conviction records may have a disparate impact on individuals because of their race or national origin Source: Society of Human Resource Management, Background Checking: Conducting Credit Background Checks (Jan. 22, 2010) What do these companies have in common? 1. Determining Whether a Background Check Can Be Requested 2

3 Can We Even Run a Background Check? Federal Law EEOC s Guidance states that background checks must be job-related and consistent with business necessity For each position, consider how criminal convictions link to the essential functions of the position in question Can We Even Run a Background Check? Federal Law Consider: Job title starting place Nature of job duties (e.g., data entry, lifting boxes) Circumstances in which job is performed (e.g., level of supervision, interaction with vulnerable adults), and Job s environment (e.g., in warehouse, private home, etc.) Can We Even Run a Background Check? State Law No state law restrictions on requesting criminal checks Nine states currently place restrictions on employers requesting credit checks States Limiting Credit Checks NJ CT MD 3

4 States Limiting Credit Checks California Connecticut Hawaii Illinois Maryland New Jersey Ohio Oregon Pennsylvania Washington 2. Requesting Background Checks Laws Governing Requesting Background Checks Federal Fair Credit Reporting Act Requirements for Obtaining a Consumer Report Disclosure and Authorization form State Mini-FCRAs 4

5 Disclosure & Authorization Form Describe background check information being requested and/or reviewed Don t name the consumer reporting agency, except in a few specific states Check the Box for CA, MN, and OK No release of liability sentence(s) Disclosure separate from Authorization Include state-required notices Application of State Background Check Laws If applicant/employee is a resident of the state OR If applicant/employee is applying to a location in the state Quick Quiz Quick Quiz I live in New Jersey, but I just can t get a good tan here, and I ve heard Phoenix, Arizona is the best place in the world. I apply for a job in Phoenix. What state background check laws apply to me? A. New Jersey B. Arizona C. Both (a) and (b) D. None of the above What state background check laws protect Snooki? A. New Jersey B. Arizona C. Both (a) and (b) D. None of the above 5

6 Disclosure & Authorization form State-Specific Information Required Disclosure & Authorization form State-Specific Information Required CT ME MD NJ MA California Connecticut Maine Maryland Massachusetts Minnesota New Jersey New York Oklahoma Oregon Washington Targeted Screening Process 3. Considering and Using Background Check Information Strongly recommended in EEOC Guidance Takes into account the following 3 factors: (1) The nature and gravity of the offense or conduct; (2) The time that has passed since the offense, conduct, and/or completion of the sentence; and (3) The nature of the job held or sought. Then, Individualized Assessment 6

7 Factor #1: Nature and Gravity of Offense Assessed with reference to the harm caused by the crime (e.g., theft causes property loss) Legal elements may be instructive (e.g., felony theft involves deception, threat, or intimidation) Not surprisingly, misdemeanors treated less severely than felonies Factor #2: Time Passed Since Offense Relevant information includes studies demonstrating how much the risk of recidivism declines over a specified time Factor #2: Time Passed Since Offense EEOC cites various studies regarding recidivism According to one study, there may be a point of redemption where an individual s risk of reoffending is no greater than the general public Other studies put the point of redemption at 6-15 years from the date of the arrest No consensus on age of relevant criminal records Factor #3: Nature of Job Held or Sought Criminal conviction should link to the essential functions of the position in question 7

8 Factor #3: Nature of Job Held or Sought Job title starting place Nature of job duties (e.g., data entry, lifting boxes) Circumstances in which job is performed (e.g., level of supervision, interaction with vulnerable adults), and Job s environment (e.g., in warehouse, private home, etc.) Screening Out Employees & Contemplating Taking Adverse Action Individualized assessment Title VII Criminal background information No matter whether obtained information from CRA or otherwise (e.g., from applicant/employee self-report) Pre-Adverse Action Letter & Reasonable Waiting Period Federal FCRA/state mini-fcras All types of background information, if obtain information from CRA Individualized Assessment Individualized Assessment EEOC Guidance: For any individuals screened out by this targeted screening process, employer s policy should then provide an opportunity for an individualized assessment EEOC stops just short of actually requiring employers to conduct individualized assessments as part of targeted screening process However, Guidance repeatedly stresses that a screening process that does not include individualized assessments is more likely to violate Title VII Read-between-the-lines meaning: EEOC will be looking for an individualized assessment when conducting investigations 8

9 Individualized Assessment Process Notice to individual that s/he has been screened out because of criminal conviction Opportunity to demonstrate that the exclusion should not be applied due to his/her particular circumstance. Consideration by the employer as to whether the additional information provided by the individual warrants an exception to the exclusion and shows that the policy as applied is not job related and consistent with business necessity. Pre-Adverse Action Letter Must send to applicant or employee and include: Request for applicant/employee to dispute and/or provide additional context for information in report [this is new, from Individualized Assessment step] Copy of the individual s consumer report Copy of the individual s rights under the FCRA (if obtained info from CRA) State-specific security freeze notices, for some states (if obtained info from CRA) States That Require Security Freeze Notices NJ RI DE MD States That Require Security Freeze Notices Arkansas Colorado Delaware Georgia Maryland Missouri New Jersey North Carolina North Dakota Oklahoma Rhode Island Tennessee Virginia West Virginia 9

10 Reasonable Waiting Period To allow applicant or employee to dispute report (under the FCRA) To conduct Individualized Assessment (under the EEOC s new Guidance) Must wait reasonable time (under the FCRA) No statutory indication of what is reasonable 5 business days Individualized Assessment Factors Individual s showing that he/she was not correctly identified in the criminal record or that the record is otherwise inaccurate Facts or circumstances surrounding offense or conduct Number of offenses for which individual was convicted Individualized Assessment Factors Length and consistency of employment history before and after the offense or conduct Rehabilitation efforts, e.g., education/training Employment or character references and any other information regarding fitness for the particular position and Whether individual is bonded under a federal, state, or local bonding program Individualized Assessment If individual does not respond... employer may make employment decision without the information One example in Guidance includes employer placing the employee on an unpaid administrative leave pending an investigation Implication that unpaid leaves are o.k.? 10

11 After receiving negative information Communicating Results Pre-Adverse Action Letter Reasonable Waiting Period Both are part of Individualized Assessment process described above. After receiving negative information (cont.) Adverse action notification letter Name, address, and telephone number of the consumer reporting agency (CRA) that furnished the report; Applicant or employee may obtain a free copy of the consumer report from the CRA within 60 days of the adverse action ; CRA did not make the decision to take the adverse action and is unable to provide the individual the specific reasons why the adverse action was taken ; and Individual may dispute with the CRA the accuracy or completeness of any information in a consumer report. Miscellaneous 11

12 Employment Applications EEOC Guidance recommends that employers not ask about convictions on job applications This is the only time the Guidance uses the term recommends Arrests Guidance repeats EEOC s long-held position that an arrest, by itself, is never job-related and consistent with business necessity Arrest does not establish that criminal conduct has occurred Individuals are presumed innocent until proven guilty Many arrests do not result in convictions Comports with O-D Comply: Background Checks advice EEOC Guidance and Federal Law Compliance with federal laws and regulations is a defense to a charge of discrimination E.g., federal government employees, federal security clearances EEOC Guidance and State Law Compliance with state and local laws does not shield employers from violating Title VII Most states regulate occupations that involve responsibility for vulnerable citizens, children, and the elderly All 50 states and D.C. require criminal background checks for certain occupations, such as nurses, elder caregivers, daycare providers, and school teachers 12

13 EEOC Guidance and Client Requirements Compliance with client requirements unlikely to shield employers from violating Title VII FCRA Penalties Any actual damages sustained by applicant or employee as a result of the offense Statutory damages - up to $1,000 per violation, if willful Punitive damages, if willful Attorneys fees Title VII Penalties Back pay Front Pay Punitive damages (capped), if willful Lessons Get separate, signed legally-compliant Disclosure and Authorization form on all applicants/employees Don t forget about applicable state law Draft policy/matrix with objective criteria that don t unnecessarily box you in 13

14 Lessons Lessons Practices or policies involving non-criminal background information should include FCRA/state law process Pre-Adverse Action letter Reasonable waiting period Adverse action letter Practices or policies involving criminal background information should include EEOC s targeted screening process Consideration of 3 factors Then, Individualized Assessment FCRA/state law 3-step process (see above) is very similar to individualized assessment Document individualized assessment Red light, green light criminal background assessments should be revisited in light of EEOC s new Guidance Red light likely over Problems with green light as well Client requirements (e.g., no employees with felonies ) and state law requirements (e.g., for nurses, teachers, etc.) will not shield employers from Title VII liability Background Checks in 2012: How to Strike the Right Balance Between Not Hiring an Axe Murderer, Not Becoming Big Brother, and Not Running Afoul of the EEOC s Guidance Questions? presented by Phillip J. Strach (Raleigh, NC) Stephen R. Woods (Greenville, SC) 14