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Criminal Background Screening on Job Applicants and Existing Employees is not Without Risk

Criminal Background Screening on Job Applicants and Existing Employees is not Without Risk

The Equal Employment Opportunity Commission (“EEOC”) just settled its first case since adoption of its 2012 updated guidance on the use of arrest and conviction records in employment decisions. The case involved BMW Manufacturing Company’s policy of a blanket prohibition against hiring any individual with certain criminal convictions.

As a brief update, the newly adopted guidance was meant to clarify and update the EEOC’s longstanding policy concerning the use of arrest and conviction records in employment decisions.  In general, the updated guidance rejects any blanket exclusion on the hiring of individuals with a criminal record.  Rather, the Guidance opines that the employer should (a) perform a validation of the conviction hiring exclusion standard under the Uniform Guidelines on Hiring and Section Procedures; or (b) apply a case-by-case individual analysis.  It is the EEOC’s position that

It is the EEOC’s position that employers must make an individualized assessment considering the nature of an applicant’s conviction, the period that has passed since the conviction, as well as giving the applicant an opportunity to explain why the criminal record should not disqualify him/her from employment.  Another important factor is that application of a criminal conviction policy to a particular applicant should be job-related and consistent with business necessity.

In the BMW case, its criminal conviction policy did not have a time limitation and excluded from employment all applicants with convictions in certain categories of crimes without regard to whether the conviction was a misdemeanor or felony, the age of the conviction, or the nature or gravity of the individual crime.  The EEOC’s lawsuit against BMW arose after BMW switched contractors at its logistic services facility in South Carolina.  With the old contractor, BMW allowed the contractor to use its own criminal conviction policy to screen employees.  However, under the new contractor’s arrangement, BMW required that its criminal background policy be used instead.

As a result, all employees had to undergo a new employee criminal background check under BMW’s more stringent guidelines.  During the litigation, the EEOC discovered that 100 workers, 80% of whom were African American, did not pass BMW’s inflexible criminal background check, including many employees who had worked for BMW’s contractor for several years.  All of these workers were denied employment with the new contractor.


The EEOC argued that because BMW’s criminal conviction policy disproportionately disqualified African Americans from employment, BMW should have evaluated whether the policy was job-related and consistent with business necessity.  However, because BMW did not do so, and the policy was not job-related, the EEOC determined that BMW’s policy had a discriminatory adverse impact on African Americans and was illegal.

In sum, even though the case settled, it is a reminder to employers to be careful in applying a rigid, or inflexible criminal conviction policy.  Employers must be certain that its policy is job-related and consistent with business necessity.  To the extent that an employee criminal background policy results in a disproportionate disqualification of minority applicants, the employer must be able to prove the existence of a legitimate business reason that necessitates the policy.  If the employer is unable to do so, it may find itself on the wrong end of a federal lawsuit.  Because of the ever-changing legal landscape, it is always a good idea to regularly review and update employment practices policies for just this reason.

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