Be Careful with Use of Background Checks

Running background checks on prospective employees is a good thing. Right? Here at BarryStaff we routinely run background checks on candidates submitted to our client companies. But if the information isn’t being used correctly and candidates are being rejected for reasons unrelated to their ability to do the job, these things can backfire. Check out this article by an Employment Attorney from “Front Page News.”

Be Wary of Running Background Checks
Employment attorney Heather Brock from FPN (Front Page News)

Running criminal background checks on future employees is smart business. However, be aware of federal regulations governing such checks before you jump into the pool. They may come back to bite you later.

Consider the case brought against a major restaurant chain when its employee sexually assaulted a 3-year-old customer on property. Prior crimes would have been revealed if the employer had conducted a simple background check. This step would have prevented the hire and the terrible attack and litigation that followed.

But the risk associated with running background checks is on the rise. Last summer the federal Equal Employment Opportunity Commission (EEOC) began examining the effect of using criminal background checks on job applicants and current employees. As background to the EEOC’s examination, consider what happened to the bottling arm of Pepsi Beverages Co., which had a long-standing policy of conducting background checks on all applicants.

In 2006, that policy came to the attention of the EEOC, which investigated whether the policy discriminated against minorities. Pepsi claimed that its policy did not discriminate. But the EEOC investigation found otherwise. It said that between 2006 and 2010, more than 300 African-American job applicants were wrongfully denied employment in violation of Title VII of the Civil Rights Act of 1964. In January, Pepsi Beverages agreed to pay a hefty $3.13 million fine to resolve the resulting race discrimination lawsuit.

What gives? Pepsi Beverages had refused to hire applicants if the checks revealed arrests, even if those arrests had not led to convictions. It also denied employment to people who had been convicted of only minor offenses. The EEOC says using arrest and conviction records to deny employment can be illegal under the Civil Rights Act of 1964 if doing so disproportionately impacts certain racial or ethnic groups, which it did in that case.

In 1987, the EEOC issued guidance on pre-employment selection guidelines. Since that time, smart employers have been using the following considerations to guide decision-making in response to information revealed by background checks:
· The nature and gravity of the offense
· The time that has passed since the conviction and/or completion of the sentence
· The job-relatedness or relevance of the offense.

The EEOC is soon expected to provide additional guidance on whether the use of criminal background checks has a disparate impact on certain groups, and whether an employer will have to offer empirical evidence to substantiate the business necessity for the use of such information (how using the checks increases employee safety or productivity). Given the direction the EEOC is taking, employers who want to assess whether their background check policies are fair might consider conducting a privileged policy review with their attorney.
For now, employers should not abandon criminal background checks altogether. Just as employers may face sanctions if they do improper or unfair background checks, they can have serious potential liability for failing to run them. What is revealed by a criminal background check often provides crucial information that allows employers to make the best hires.

Consider the manager applicant who has prior convictions for stealing. Next, please! Further, negligent hiring and negligent retention lawsuits can be expensive to defend.
The EEOC has stated its desire to remove barriers to employment for applicants with criminal backgrounds. That is a worthy goal, in the abstract. But, businesses must protect the safety of their employees, customers and property. That’s just good business. So, the debate about workplace fairness versus workplace safety continues.