Background Screening: Recent Litigation Trends
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Background Screening: Recent Litigation Trends
- 1. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights 1
- 2. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights The Basic Truths About Background Screening: Recent Litigation Trends 2 Trak-1 is an Accredited Member of NAPBS
- 3. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Your Host: Rick Coltman Director of Strategic Marketing and Alliances, Trak-1 Technology, Inc. • Please Post Any Questions or Comments You Have in the Comments Section. • Want Further Information or Have Additional Questions? Contact Trak-1 at Rick.Coltman@trak-1.com • Hopefully You Find this Webinar Informative! Please Join Us for Each Webinar at http://trak-1.com/webinar Your Presenter: Matt Graham VP of Operations, Trak-1 Technology, Inc.
- 4. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Quick Refresher FCRA The Fair Credit Reporting Act Applies To All Background Screening By A Consumer Reporting Agency (CRA) Not Just CreditNot Just EmployeesNot Just Criminal
- 5. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Goals of the FCRA • Protect the Privacy of Consumer Report Information • Guarantee That the Information Supplied By Consumer Reporting Agencies is as Accurate s Possible • Inaccurate or Incomplete Consumer Reports Could Cause Applicants to Be Denied Jobs or Cause Employees to Be Denied Promotions Unjustly
- 6. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights EEOC Revises Enforcement Guidance • April 25, 2012 (Last Updated Over 20 Years Ago) • Interprets Title VII Of Civil Rights Act, ADA, ADEA, GINA, EPA • Starts From The Premise That Using Criminal Records In Employment Decisions, Absent Additional Considerations, Has a Disparate Impact
- 7. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Factors To Consider The Nature and Gravity of the Offense(s) The Time That Has Passed Since Conviction/Sentence The Nature Of The Position Held/Sought
- 8. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Individualized Assessment • The Facts or Circumstances Surrounding the Offense or Conduct • The Number of Offenses For Which the Individual Was Convicted • Older Age at The Time of Conviction, or Release From Prison
- 9. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Evidence That The Individual Performed The Same Type Of Work, Post Conviction With The Same Or A Different Employer, With No Known Incidents Of Criminal Conduct • The Length And Consistency Of Employment History Before And After The Offense Or Conduct • Rehabilitation Efforts, E.G., Education/Training Individualized Assessment
- 10. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Employment or Character References and any Other Information Regarding Fitness For the Particular Position • Whether The Individual is Bonded Under a Federal, State, or Local Bonding Program. Individualized Assessment
- 11. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights EEOC Best Practices • Eliminate Policies or Practices That Exclude People From Employment Based on Any Criminal Record • Develop a Narrowly Tailored Written Policy and Procedures For Screening For Criminal Records • Train Managers, Hiring Officials, and Decision-makers About Title VII and Its Prohibition on Employment Discrimination
- 12. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Identify Essential Job Requirements and The Actual Circumstances Under Which The Jobs are Performed • Determine The Specific Offenses That May Demonstrate Unfitness For Performing Such Jobs EEOC Best Practices
- 13. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Determine The Duration of Exclusions For Criminal Conduct Based on All Available Evidence • Record The Justification For The Policy and Procedures • Keep a Record Of Consultations and Research Considered in Crafting The Policy and Procedures EEOC Best Practices
- 14. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Summary Of EEOC Guidance 1. Change Your Application 2. Review Your Authorization/Disclosure 3. Customize Your Screening Based on The Functions of The Positions 4. Support Your Matrix With Science/Statistics 5. Adjust Decision Criteria
- 15. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Case Examples Freeman BMW Dollar General
- 16. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights EEOC Before The Guidance FREEMAN CASE Black Eye For EEOC Multiple Procedural and Expert Witness Issues
- 17. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Expert Analysis “Distorted”, “Both Over-inclusive And Under-inclusive”, and, “An Egregious Example Of Scientific Dishonesty” • Failed To Show Disparate Impact Stemming From A Specific Employment Practice FREEMAN CASE
- 18. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Offered The Job Before Conducting The Background Screening • Only Considered Convictions Or Releases From Prison Occurring Within The Last Seven Years • Evaluated Offenses In Terms Of Job- relatedness • Rated Crimes Based On Severity FREEMAN CASE
- 19. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Reviewed Warrants and Gave Applicants a Reasonable Amount of Time To Resolve Them. • Upper HR Officials Reviewed Recommendations of “Not To Hire” • Restricted Use of Credit Checks To Those Handling Consumer Credit Cards, Money and Customer’s Property of Value FREEMAN CASE
- 20. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights • Avoid Exposure To Negligent Hire/Retention Lawsuits • Increase Security of Its Assets And Employees • Reduce Liability From Inconsistent Hiring or Screening Practices • Proactively Reduce The Risk of Employee- related Loss • Mitigate The Likelihood of Adverse Incidents Occurring on Their Property That Could Jeopardize Employee or Consumer Confidence FREEMAN CASE
- 21. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights
- 22. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Application Of EEOC Guidance Employees With Long-standing History of Success With The Company Were Not Retained When a Subsequent Background Check Turned Up a Criminal Past BMW CASE
- 23. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights One Applicant Denied a Cashier Position Because of 6 Year Old Drug Conviction In Spite of Previous Position With Another Discount Retailer as a Cashier-stocker For Four Years Another Applicant Advised Store Manager of an Incorrect Background Check Report But Company Refused To Hire Anyway DOLLAR GENERAL CASE Application Of EEOC Guidance
- 24. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights AGs Letter to EEOC (7/29/13) • Nine Attorneys General Send Letter To EEOC – Drop Cases, Rescind Guidance • Unlawful Expansion Of Title VII • State Law Interference • Burden On Business
- 25. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights EEOC Response To AGs (8/29/13) • Updates Longstanding Policy • Does Not Urge Or Require Individualized Assessment • Encourages Two-step Process – Targeted Screening, Individualized Assessment • Guidance Doesn’t Preempt, Title VII Does
- 26. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Recent Class Action Cases • State Farm (Case No. 5:14-cv-00151; E.D. Ky.) April 18, 2014 • US Foods, Inc. (Case No. 8:14-cv-00612; C.D. Cal.) April 18, 2014 • Walmart (Case No. 3:14-cv-00208; E.D. Va.) March 24, 2014 • Disney (Case No. BC 526351; Superior Court of California) November 1, 2013 • Whole Foods (Case No. 3:14-cv-00592; N.D. Cal.) February 7, 2014
- 27. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Take Away Points 1. Understand EEOC’s Guidance On Using Criminal Records 2. Review Your Application 3. Review Disclosure And Authorization Forms 4. Confirm You Are Providing Adverse Action Notices 5. Remember FCRA Allows For $100 - $1000 Per Violation
- 28. The Basic Truths About Background Screening, Part 9 Copyright © 2015. TRAK-1 Technology, Inc. All Rights Name Matching Copyright © 2014. Trak-1. Produced by Business Performance- USA/Global, LLC. Graphics by Ligature Group, LLC. All Rights Reserved. 1.800.600.8999 www.trak-1.com Contact Matt Graham directly or talk with Trak-1’s FCRA certified screening professionals and begin – Ruling In The Right People! Coming Up Next….
Editor's Notes
- Judge Titus blasted both the EEOC's theory and the multiple flaws in the analysis of its experts, concluding that the EEOC's lawsuit was "a theory in search of facts to support it." The judge also noted the dilemma faced by employers in connection with the EEOC's opposition to the use of background checks: By bringing actions of this nature, the EEOC has placed many employers in the "Hobson's choice" of ignoring criminal history and credit background, thus exposing themselves to potential liability for criminal and fraudulent acts committed by employees, on the one hand, or incurring the wrath of the EEOC for having utilized information deemed fundamental by most employers.
- For example, Dr Murphy had access to information about more than 58,000 applicants, but focused on only about 2,000 applicants, most of whom were not even connected with the time periods that were the subject of the case.
- Violent crimes, destruction of private property (employees handled Freeman’s and vendors’ property) sexual misconduct, felony drug convictions and job-related misdemeanors were the highest-concern crimes
- Since 1994, BMW has had a criminal conviction policy that denies facility access to BMW employees and employees of contractors with certain criminal convictions. However, when UTi assigned the claimants to work at the BMW facility, UTi screened the employees according to UTi's criminal conviction policy. UTi's criminal background check limited review to convictions within the prior seven years. BMW's policy has no time limit with regard to convictions. The policy is a blanket exclusion without any individualized assessment of the nature and gravity of the crimes, the ages of the convictions, or the nature of the claimants' respective positions. In 2008, UTi ended its contract with BMW. During a transitional period, UTi employees were informed of the need to re-apply with the new contractor to retain their positions in the BMW warehouse. As part of the application process, BMW directed the new contractor to perform new criminal background checks on every current UTi employee applying for transition of employment. The new contractor subsequently discovered that several UTi employees had criminal convictions in violation of BMW's criminal conviction policy. As a result, those employees were told that they no longer met the criteria for working at the BMW facility and were subsequently terminated and denied rehire as employees of the new contractor, despite the fact that many of the employees had worked at the BMW facility for years.
- In Illinois, the Chicago office of the EEOC filed a nationwide lawsuit based on discrimination charges filed by two rejected black applicants. That lawsuit charges that Dollar General conditions all of its job offers on criminal background checks, which results in a disparate impact against blacks. Dollar General operates 10,000 stores in 40 states, plus 11 distribution centers. Ninety percent of all Dollar General employees are store clerks who are both stockers and cashiers at the stores. According to the EEOC, one of the applicants who had filed a charge with EEOC was given a conditional employment offer, although she had disclosed a six-year-old conviction for possession of a controlled substance. Her application also showed that she had previously worked for another discount retailer as a cashier-stocker for four years. Nevertheless, her job offer was allegedly revoked because Dollar General's practice was to use her type of conviction as a disqualification factor for 10 years. The other applicant who filed an EEOC charge was fired by Dollar General although, according to the EEOC, the conviction records check report about her was wrong - she did not have the felony conviction attributed to her. The EEOC said that although she advised the Dollar General store manager of the mistake in the report, the company did not reverse its decision and her firing stood.
- West Virginia Alabama Colorado Georgia Kansas Montana Nebraska South Carolina Utah All Republican
- Bi-Partisan commission, 300 comments considered 5 commissioners: 3 democrat, 2 republican At the outset, I want to make clear that it is not illegal for employers to conduct or use the results of criminal background checks, and the EEOC never has suggested that it is. - Commissioner Berrien
- Statutory damages of not less $100 and not more than $1,000 for each and every violation may be assessed. State Farm - failing to provide plaintiffs with a copy of the consumer report and a statement of rights under the FCRA before taking adverse action US Foods - taking adverse action against plaintiffs without providing pre-adverse action notices Walmart - failing to provide plaintiffs with a pre-adverse-action notice before taking adverse action Disney – failing to provide pre-adverse-action and adverse-action notices, and for failing to provide applicants with a copy of their consumer reports Whole Foods - using a consent form that was not legally valid