Employers often rely on background checks before making important hiring decisions. In both the pre-employment and post-employment stages, background checks can be valuable tools. In general, employers are free to rely on such information during the employment process; however, various federal and state laws impose restrictions and additional requirements when accessing and relying on certain types of information.
Criminal Background Checks
Criminal histories are one of the most common types of background information that employers check before hiring (or promoting) an employee. There is no nationwide, federal “ban the box” statute, or any other federal law directly prohibiting the use of criminal background checks. However, the Equal Opportunity Employment Commission (“EEOC”) issued a guidance in 2012 which purports to restrict the manner in which employers use criminal background information. In addition to this guidance, an increasing number of states are passing “ban the box” laws to restrict the use of criminal background checks for employment decisions. Currently, Virginia has no statutory restrictions on the use of criminal background checks in employment decisions.
The EEOC’s position is that criminal background checks could constitute illegal discrimination under Title VII of the Civil Rights Act of 1964 (“Title VII”) if an employer treated people with similar criminal histories differently based on race, gender, religion or another category protected under Title VII or if a facially neutral policy on criminal background checks had a disparate impact based on a characteristic protected under Title VII.
The EEOC cautions employers to use criminal background information in the same way for all applicants or employees and avoid automatic, across-the-board exclusions for criminal conduct. Employers should consider a few factors when a candidate has a criminal history, including the nature and gravity of the offense or conduct, the time that has passed since the offense or conduct, and/or completion of sentence, and the nature of the job held or sought.
Employers should not be discouraged from using criminal background checks for two reasons. First, the EEOC has not been very successful in persuading courts that employers have violated Title VII in using criminal background checks. The EEOC has pursued several cases in the past few years based on a disparate impact theory but has yet to be successful. In fact, in at least one case brought by the EEOC relating to criminal background checks, the employer prevailed on recovering some of its attorney’s fees given the lack of evidence the EEOC had to support its case. Recently, Republicans on the House Education and the Workforce subcommittee held an oversight hearing in which they broadly attacked the EEOC’s policies restricting the use of background checks.
Second, there are situations where an employer has potential liability if it hires individuals with criminal histories and that person later harms someone in the course of employment. For example, if an apartment complex hires someone previously convicted of assault as a maintenance person and gives that person keys to the residents’ units and that individual assaults a resident, the employer can be held liable under a negligence theory.
Moreover, there are some situations where employers are required to consider criminal background checks, such as employers in the education and health care industries. Government contractors are frequently required to conduct criminal background checks associated with obtaining security clearance. As long as employers follow the letter of those requirements, use of criminal background information in these contexts is necessary and unlikely to lead to liability.
Fair Credit Reporting Act (“FCRA”)
The FCRA requires that “consumer reporting agencies” provide notice and other protections to “consumers” when obtaining or taking actions based on certain reports on that consumer. On its face, the FCRA would not seem to apply to employers seeking criminal background checks or other types of checks. However, the FCRA is very broadly construed and in many instances applies to employers conducting background checks including into criminal records. Usually, if the employer is obtaining the criminal background report directly (or directly from the police), the law would not apply. If the employer is using a third-party background check company, however, the law likely will apply. Most reputable background check companies will be aware of this law and provide the employer with the appropriate forms.
Best Practices
As a practical matter, employers should not inquire about criminal history on applications, but instead should conduct a criminal background search after making a conditional offer of employment. Employers should not consider arrest or charge information (as opposed to convictions). Employers should not adopt blanket rules, such as ones barring anyone with a conviction or anyone with a felony conviction. Instead, employers should consider each conviction in light of how old it is, the nature and severity of the crime, and the nature of the position. If you are working with a third-party to conduct criminal background checks, ask them about the FCRA. Make sure you familiarize yourself with any state-specific statutes for states in which your company operates or with any industry-specific requirements for jobs you are filling. Finally, when government security clearance is required, make sure you are following the government’s requirements instead of imposing additional, more stringent requirements.
About the Author
Sara Rafal is a Partner in the Labor & Employment Section at Williams Mullen. If you have questions about this topic, she can be reached at 757.473.5384 or at srafal@williamsmullen.com.
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