Criminal Records in the Hiring Process

Posted in Employee Rights, Employer Rights, Employment Law, News on July 23, 2014

Should an employer have the right to disqualify applicants based on criminal convictions?  If so, should the law impose any limitations on this right?  There exist strong arguments on either side of the debate.  From the employer’s perspective, uniform application of a policy excluding candidates who have a criminal conviction – i.e., application of the policy in a manner that does not unfairly discriminate on the basis of race, national origin, or any other protected status – enables the employer to protect its assets, its operations, its employees and its customers.  It also enables the employer to avoid the potentially time consuming and expensive process necessary to assess on an individual basis whether a person’s criminal history should preclude him/her from further consideration; an assessment ultimately susceptible to an attack on the inherently subjective and imprecise nature of the process.

On the other hand, from the perspective of the individual with the criminal conviction and perhaps society as a whole, equally compelling arguments exist.  Automatic exclusion of applicants with criminal convictions not only prevents an individual from demonstrating his/her qualification notwithstanding the conviction, but it also runs counter to the notion of rehabilitation inherent in our criminal justice system, creates a class of unemployable or underemployed people, and may lead to further criminal activity.  Moreover, even when neutrally applied, a no-criminal-record policy may disproportionately impact persons of particular races or national origins who have a statistically disparate rate of incarceration.  To the extent that those defending these policies would point to statistics regarding recidivism, statistics can only go so far in helping to predict the likelihood of recidivism for any particular person.  Finally, a criminal conviction may have little or no connection to the particular job in question.  While few would condone drunk driving, for example, it’s hard to make a compelling argument that a conviction for this crime renders the person unfit to perform a job that does not require driving.

Hiring Practices

Not long ago, the debate about the extent to which employers should reject candidates with criminal records seemed largely academic and employers could with reasonable certainty enforce policies that prohibited hiring anyone with a criminal conviction.  Things have changed.  A spate of recently-enacted laws, enforcement activity by the EEOC and the Federal Trade Commission (FTC), and class action litigation have focused on the impact of these policies and require that employers review their hiring practices in several regards.

Background Checks

Employers need to ensure compliance with the Fair Credit Reporting Act (FCRA) and applicable state counterparts such as the California Investigative Consumer Reporting Agencies Act (ICRAA). The FTC and EEOC earlier this year jointly issued tips regarding the use of background reports in the employment context, with the FTC emphasizing the need to comply with the FCRA’s disclosure and authorization requirements. We have also seen in the past two years a number of class action cases filed against large companies alleging failure to comply with the FCRA in obtaining background reports during the hiring process.

Employment Applications

In the many locations that have enacted “ban the box” laws, an employer may need to remove from its application form questions regarding criminal convictions and may need to defer asking applicants about their criminal record until after the initial interview or some later stage in the process.

Disparate Impact

Even where it uniformly applies its policy against hiring applicants with a criminal record, an employer should consider whether application of the policy has a disparate impact on persons of a particular protected class. Although the EEOC has had some difficulty in its initial pursuit of disparate impact discrimination claims based on these policies, it will undoubtedly continue its focus in this area. Class litigation by private litigants also seems inevitable. The assertion of the business necessity defense in these cases will not only renew the debate about the relevance of criminal convictions to job qualification, but also may require employers to convincingly demonstrate why a particular criminal conviction renders a particular applicant unqualified for a particular position. This will require far more than generalizations and assumptions about what criminal convictions reveal about an applicant.

Consideration of Criminal Convictions

Properly obtaining a criminal background report and applying a policy in a non-discriminatory manner will avoid some potentially significant risks, but it does not give the employer unlimited discretion to reject applicants with a criminal record. California law prohibits an employer from rejecting an applicant based on certain marijuana-related convictions more than two years old. Other states restrict an employer’s ability to consider sealed or expunged convictions, misdemeanors convictions dating back a specified number of years, or convictions for certain crimes. California and a number of other states also significantly restrict an employer’s ability to consider records of an arrest that did not lead to conviction.

Whether one views this developing trend as requiring employers to hire criminals, a progressive approach to the rehabilitation process, or something in between, all signs indicate that this will prove an increasingly active area for legislation, enforcement by administrative agencies, and litigation.