Use of Criminal Background Checks in the Hiring Process

Date: October 1, 2015

You are the hiring person at your organization.  As part of your hiring process, your organization considers an individual's criminal history as a factor in whether to exclude applicants in the employment process. Because this is an evolving area of the law, employers' reliance on criminal background checks in the hiring process can pose some risk.    

Recently, the Court of Appeals for the Fourth Circuit ruled in favor of an employer in a case involving a challenge to the employer's use of criminal background and credit history checks in the hiring process. The court found that the Equal Employment Opportunity Commission's (EEOC) reports had number of errors and discrepancies.  The EEOC had alleged that the criminal background checks had a disparate impact on African American and male applicants.  In this case, the employer got lucky in that the court found the EEOC's expert reports as unreliable so it did not express an opinion on the merits of the EEOC's claims.  

Besides EEO issues, employers may face additional restrictions based on recent legislative developments at the state and local levels such as “ban-the-box” laws which limits the use of criminal history in hiring and employment decisions.  There has also been class action litigation against employers under the Fair Credit Reporting Act (FCRA) based on gathering criminal history and background check conducted through third party consumer reporting agencies on applicants or employees.

So what can employers do?  

Review your hiring process and procedures and your employment applications.  Consider the timing of when to make criminal history and background check inquiries based on restrictions under ban-the-box legislation at the state and local levels.  Moreover, consider aspects of a criminal history about which you may not ask.  If the investigation reveals an applicant's criminal history, consider your obligations under the same restrictions.  Finally, consider any obligations following an adverse action.  If you do find criminal history, allow the applicant an opportunity to explain any irregularities in the report.      

Develop a system to inform your employees of your business and how to use criminal history information to make proper employment decisions prior to excluding an applicant or employee from employment based on that individual's criminal record.   

Ensure compliance with FCRA through appropriate forms, keeping in mind the extent to which criminal history may be relied upon to exclude an applicant where such forms may be subject to legal challenge.

Finally, review and keep an eye on federal, state and local developments that may impact your use or reliance on criminal history.