Employment Discrimination Report : New York Attorneys & Lawyers for Labor Discrimination Defense : Fox Rothschild LLP

Well known Chicago-school law professor Richard Epstein has taken on the employment discrimination laws and the EEOC in a newly published column by conservative think-tank the Hoover Institution.  “Antidiscrimination laws can wreak havoc on job creation,” says Epstein. “The Equal Opportunity Employment Commission, a federal agency tasked with enforcing antidiscrimination laws, has demonstrated just how destructive such laws can be. “

Epstein targets as “folly” the EEOC’s “Enforcement Guidance” of April 2012, dealing with criminal arrest and background checks.  He states that this “newest confection out of the EEOC orders most employers to do exactly what the law forbids. It introduces an explicit classification into the hiring equation by imposing a higher standard for refusing to hire minority workers than for others. The Enforcement Guidance also applies even when it is clear that the employer’s refusal to hire certain workers is not because of race but because of the evident risk that a criminal record could present to the employer, its other employees, and its customers.”

Excoriating the EEOC, Epstein says that “[n]othing is more dangerous in public or private affairs than power without responsibility. It is therefore a fair question to ask how the EEOC guidance took its final shape.”

After a long exegesis of the law and its enforcement, Epstein concludes that both employers and employees suffer because “by raising transaction costs, the EEOC will continue on its mindless job-killing path.  Once again, the EEOC seems utterly oblivious to the harm that it causes to the groups that it most wants to help—and indeed to everyone else.” 

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The EEOC conducted a public meeting this past week and voted 4-1 to approve its proposed guidance which deals with the use by employers of arrest and conviction records in background checks used for hiring. We reported last week that EEOC Commissioner Lipnic had stated that this was a key upcoming agenda item for the EEOC. Commissioner Constance S. Barker was the lone dissenter.

The guidance is not all that easy to understand, much less comply with, so we will give a capsule summary and until we can digest it further and until there are some court cases which interpret it, we will sheepishly provide you with links to the appropriate EEOC web sites and let them help you figure it out.

The EEOC press release referred those concerned to its Enforcement Guidance and a Question-and-Answer (Q&A) document, These web sites also set forth the EEOC’s suggested “best practices.” The materials used at the public meetings, including testimony and transcripts, are available at http://eeoc.gov/eeoc/meetings/index.cfm.

Title VII prohibits discrimination in employment based on protected classes such as race, color, national origin, religion, or sex. There is nothing in Title VII that deals with people with a criminal history being in a protected class. That is, it does not bar employers from asking job applicants or employees about arrests, convictions or incarceration.

However, we know that discrimination comes in two flavors – it may be intentional, or it may involve an employment practice or policy which may have a “disparate impact” upon members of a protected class. In the case of criminal background checks, the EEOC is sensitive to the “disparate impact” which criminal background checks (as well as, for example, credit screening), may have on protected classes, and therefore may violate Title VII. This is not a new issues; the EEOC has been wrestling with this issue since at least as far back as 1987

Basically, the approved guidance prohibits the use of criminal record information unless it is “job related” and “consistent with a business necessity defense.” What does this mean? And how will this impact employment practices? And will this put an undue burden on employers?

EEOC Chairwoman Jacqueline A. Berrien has stated that “The new guidance clarifies and updates the EEOC’s longstanding policy concerning the use of arrest and conviction records in employment, which will assist job seekers, employees, employers, and many other agency stakeholders.”

But dissenting Commissioner Barker claims that the impact on employers will be grave: "If I were a business owner, I would never again conduct another criminal background check on a potential employee unless I was required to under federal law. Why should they? The guidance tells them they are taking a tremendous risk if they do."  The U.S. Chamber of Commerce agrees.

After reviewing these websites, please inundate us with your questions and confusion.

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We recently received a comment from a reader in response my blog "Employers' Use of Biometric Time Clocks Could Violate State Law" that essentially asks this question (albeit, in much nicer form). 

 Without commenting specifically on this reader's situation, the comment did raise a more general question as to when, if ever, an employer may require its employees to be fingerprinted?  The answer, in short, is that unless a state law prohibits it, employers are permitted to fingerprint as part of a background check any employee or contractor, regardless of position held. 

In some cases, employers may be required to fingerprint applicants and employees.  For example, 34 states, as of 2010, required fingerprinting of public school employees.  Further, as a matter of practice, some industries, such as financial service providers, routinely require fingerprinting as part of a background check. 

In several states, however, employers may be prohibited from inquiring about certain parts of a criminal background.  In addition to the states, like Hawaii, that very broadly ban the use of criminal background checks with limited exceptions, other states, like California, restrict access to arrest records that did not result in conviction.

Employers are thus cautioned to insure compliance with all state and federal background check laws and should obtain the required authorizations before requesting fingerprints.  It is also recommended that employers consult with employment counsel before implementing a policy requiring fingerprinting of employees. 

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A recent HR.com blog had an interesting article on using biometric time clocks to curb employees' time clock fraud.  Although the article correctly notes that having employees scan their finger or palm to sign in and out would eliminate the problems of employees clocking out for another employee, these high-tech time clocks may violate state law.

For example, New York's Labor Law prohibits employers from fingerprinting employees unless required to do so by law.  This law may seem to apply only to fingerprinting employees as part of background checks, but in fact, is much broader than that.  The Department of Labor has issued an opinion letter that specifically states that the use of biometric clocks that scan employees' hands may violate the law, even though the fingerprints are not stored and saved. 

A New York employer would not violate the law by using the biometric time clock if the employees were otherwise required by law to be fingerprinted, for example, employees of public school systems.  Employers in other states should check whether their state has a similar law before eliminating time sheets and punch cards in favor of a biometric time clock.

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In case you were wondering, the title to this blog is not a typo.  We have posted two recent blogs (March 22, 2011 and February 9, 2011) cautioning employers on the use of background checks.  Although there are currently several laws pending that would restrict the use of background checks, only one recently passed. 

On April 13, 2011, Philadelphia Mayor Michael A. Nutter signed an Ordinance restricting public and private employers with more than ten employees in the City of Philadelphia from inquiring into arrests and convictions.  The Ordinance will take effect July 12, 2011.  The key provisions provide:

• Defines "application process" as beginning when the applicant inquires about employment being sought and ending when the employer accepts an employment application;
• Employers may never, whether during the application process or thereafter, inquire into arrests that did not result in a conviction and which are not currently pending;
• Employers may not ask on an application or during the application process about criminal convictions;
• Employers may not ask about criminal convictions during the initial interview; and
• If an employer chooses not to interview a candidate before making a job offer, then the employer may never inquire about the candidates criminal convictions.

What should employers do prior to July 12, 2011?

1. Review employment applications to remove any questions asking applicants to disclose criminal history.
2. If you don't have a written application, develop one so there is no question as to when the application process ends.
3. Train hiring managers and HR personnel to avoid asking improper questions

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