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No Enforcement of the EEOC’s Criminal Background Check Guidance?

By Fiona W. Ong - Shawe Rosenthal LLP

February 8, 2018

My world shifted slightly last week, when a federal court in Texas ruled that the Equal Employment Opportunity Commission could not enforce its Enforcement Guidance on “Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964.” After all, for years now I had looked to this Guidance as the EEOC’s definitive position on the use of criminal background records, particularly in hiring. I had referred clients to it, provided legal advice based on it, cited it in articles and presentations…. But now?

For those of you who may not be familiar with this Guidance, the EEOC issued it in 2012 to replace some earlier policy statements on this issue, following a 2007 federal court decision that criticized those earlier guidelines. While the EEOC reiterated its consistent position that employers must consider (1) the nature of the crime, (2) the time elapsed, and (3) the nature of the job, it further suggested that employers should conduct an “individualized assessment” with regard to each applicant to determine if the policy as applied is job related and consistent with business necessity. With regard to this individualized assessment, the EEOC provided a new list of factors that employers should consider (claiming all the while that it was simply compiling past information):

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.

Evidence that the individual performed the same type of work, post-cnviction, 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).

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.

At the time that the EEOC released its Guidance, we blogged about the impact of this, stating that, “The bottom line is that the Commission’s claim that the updated rules do not reflect a substantive change in its enforcement policy or the guidelines it expects the courts to apply is disingenuous.” Nonetheless, I bowed to the power of the EEOC, and used the Guidance in formulating criminal check policies and advising clients on how not to run afoul of the EEOC. And the EEOC itself has referred to this guidance in bringing suit against a number of employers over their background check policies.

But a brave employer – the State of Texas – dared to go where I did not. (Yes, if any employer would take on the EEOC, it would be those renegades in the Lone Star State). In State of Texas v. EEOC, a lawsuit brought by the EEOC challenging the State’s ban on hiring felons in certain State agencies, the State questioned the EEOC’s authority to issue the Guidance. And the federal district court agreed with Texas that the Guidance was a substantive rulemaking that is subject to legally required notice and opportunity for public comment under the Administrative Procedures Act, with which the EEOC had not complied. The court barred the EEOC from enforcing its Guidance against the State (and, by implication, anyone else) until the EEOC complies with the mandatory rulemaking procedures. Of note, however, the court declined to say that the EEOC’s Guidance was substantively flawed or misinterpreted Title VII.

So where does that leave us? Well, unless and until the EEOC follows the rulemaking process, we could argue that its Guidance is unenforceable. If and when the EEOC does issue the Guidance as a proposed rule for public notice and comment, I would expect to see it virtually unchanged. And in the meantime, the principles underlying the Guidance, which in many instances are drawn from existing caselaw, still apply, and we can expect the EEOC to continue to assert those positions, even without a Guidance in place. So ultimately, I still think that the Guidance provides useful information for employers.

And the other lesson? Don’t mess with Texas.

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