U.S. Equal Employment Opportunity Commission (EEOC)

Written By ESR News Blog Editor Thomas Ahearn

On November 18, 2019, the U.S. Equal Employment Opportunity Commission (EEOC) – which advances opportunity in the workplace by enforcing the federal laws prohibiting employment discrimination – announced that a major retail chain had agreed to pay $6 million to settle a discrimination lawsuit filed by the EEOC that claimed the retailer’s criminal background check process discriminated on the basis of race.

According to the lawsuit filed by the EEOC in U.S. District Court for the Northern District of Illinois in Chicago, Dollar General – the largest small-box discount retailer in the United States – violated Title VII of the Civil Rights Act of 1964 by denying employment to African American applicants at a significantly higher rate than white applicants for failing the company’s broad criminal background check.

The three-year consent decree settling the lawsuit requires Dollar General to pay $6 million into a settlement fund which will be distributed to African Americans who lost their chance at employment at the company between 2004 and 2019. Employment screens that have a disparate impact on the basis of race violate Title VII unless an employer can show the screen is job-related and is a business necessity.

“Because of the racial disparities in the American criminal justice system, use of criminal background checks often has a disparate impact on African Americans. This consent decree reminds employers that criminal background checks must have some demonstrable business necessity and connection to the job at issue,” EEOC Chicago District Director Julianne Bowman stated in a press release about the settlement.  

If Dollar General uses a criminal background check during the three year consent decree, they must hire a criminology consultant to develop a new criminal background check based on time since conviction, number of offenses, nature and gravity of the offense, and risk of recidivism. Once a recommendation is given, the decree enjoins Dollar General from using any other criminal background check when hiring.

“This case is important because Dollar General is not just providing relief for a past practice but for the future as well. Unlike other background checks based on unproven myths and biases about people with criminal backgrounds, Dollar General’s new approach will be informed by experts with knowledge of actual risk,” Gregory Gochanour, regional attorney for EEOC’s Chicago District, stated in the press release.

In April of 2012, the EEOC issued “Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964” that recommended if employers ask about criminal convictions that the “inquiries be limited to convictions for which exclusion would be job-related for the position in question and consistent with business necessity.”

The EEOC enforces Title VII, which makes it illegal to discriminate against a person on the basis of race, color, religion, sex, or national origin. An employer may violate Title VII if its policy has a “disparate impact” of disproportionately screening out a Title VII-protected group without demonstrating the policy is job related for the position in question and consistent with “business necessity.”

In cases involving a criminal history exclusion, the ruling in Green v. Missouri Pacific Railroad held that the three “Green factors” relevant to assessing whether an exclusion was job related for the position in question and consistent with business necessity were the nature and gravity of the offense, the time passed since the offense or completion of the sentence, and the nature of the job held or sought.

In 2013, a group of national civil and workers’ rights organizations released a report entitled “Best Practice Standards: The Proper Use of Criminal Records in Hiring” that addressed the use of criminal records by employers during background checks. Attorney Lester Rosen, founder and chief executive officer (CEO) of Employment Screening Resources® (ESR), helped develop these best practice standards.

Rosen also wrote a complimentary white paper entitled “Practical Steps Employers Can Take to Comply with the EEOC Criminal Record Guidance” that gives examples on what employers should do to remain in compliance with EEOC Guidance when performing criminal background checks. ESR also offers a proprietary EEOC Compliance Toolkit that provides a set of software tools available only to ESR clients.

Employment Screening Resources® (ESR) – a leading global background check provider – is accredited by the Professional Background Screening Association (PBSA), undergoes annual SOC 2® audits, was named to the 2019 HRO Today’s Baker’s Dozen for Enterprise Pre-Employment Screening Services, and won the 2018 Tektonic Award for background screening technology. To learn more, visit www.esrcheck.com.

NOTE: Employment Screening Resources® (ESR) does not provide or offer legal services or legal advice of any kind or nature. Any information on this website is for educational purposes only.

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