the assault on criminal-background checks

The Assault on Criminal-Background Checks

Presented by:Aloysius Hogan, Of Counsel & Registered LobbyistJackson Lewis LLPCell: 202-957-9400Email: [email protected] toAlarm Industry Communications Committee MeetingKey Bridge Marriott in Arlington, VirginiaSeptember 8, 2011

Copyright 2009 Jackson Lewis LLP

THE ISSUEShould employers be able to do criminal-background checks on job applicants?


THE ISSUEDisambiguation:Do not confuse the separate issue of access to the FBI database with the EEOC-style assaults on background checking.


WHY IMPORTANT

WHY IMPORTANT: Criminal-background checks on job applicants are common and increasingly used by employers to try to • Protect their employees, their

customers, and the public at-large;

• To minimize exposure to potential legal liability; and

• To protect their assets.


• In Aug. 2004, SHRM reported 61% of HR professionals find inaccuracies in resumes after carrying out background checks.

WHY IMPORTANT


• In April 2006, New York Times reported on a study conducted by ResumeDoctor.com that found 43% of resumes had one or more "significant inaccuracies," while 13% had two or more.

WHY IMPORTANT


67% of U.S. job applicants’ résumés contain material misrepresentations.

WHY IMPORTANT

:


• Reliable criminal-background checks can be a critically important safeguard.

WHY IMPORTANT


HOW PREVALENT ARE BACKGROUND CHECKS?• The Government

Accountability Office reports the Consumer Data Industry Association 2003 statistic: The three major Credit-Reporting Agencies provide approximately two billion reports annually in the marketplace.

• Additionally, millions of criminal-background checks are performed each year.


HOW PREVALENT ARE BACKGROUND CHECKS?

•A member survey conducted in 2003 by the Society for Human Resource Management revealed that

80% of its organizations conduct criminal-background checks, up from 51% in a 1996 survey (and likely even higher today).


COST OF NEGLIGENT HIRING• Association of Certified Fraud

Examiners estimate in 2006 report that typically 5% of revenues are lost to fraud, meaning that $735 billion/year is lost to internal fraud.

• Small businesses are the most vulnerable, accounting for a whopping 80 percent of all internal fraud cases.

• Employee-committed acts are the most common and most expensive fraud type, constituting >50% of all reported cases.

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http://r20.rs6.net/tn.jsp?llr=h7xakreab&t=7wg6y6gab.0.9yvdz6gab.h7xakreab.8677&ts=S0659&p=http%3A%2F%2Fwww.sbnonline.com%2F2011%2F08%2Fhow-to-protect-your-small-business-against-internal-fraud%2F%3Ffull%3D1


Some criminal-justice-reform and civil-liberties advocates vehemently support maximizing opportunities for criminals (ex-offenders):

• To be rehabilitated; and • To re-enter main-stream

society as normal citizens….

CRITICS OF CRIMINAL-BACKGROUND CHECKS


… But at what cost?



• … To society?

• … To employers?

• … To employees?

• … To victims?

• … To high at-risk and vulnerable populations (e.g. children, the disabled, and the elderly)?



CRITICS OF CRIMINAL-BACKGROUND CHECKS:

• Feel that employers use criminal-background checks to “discriminate” against convicted felons and impede their re-integration into society.



Studies (University of Chicago, Georgetown) show just the opposite: Companies that use criminal-background checks are

• Less likely to engage in discrimination,

• More likely to hire ex-offenders, • More likely to hire minorities, and • More likely to recognize their legal

responsibilities and obligations.



• “Citizen re-entry” advocates criticize criminal-background checks in 1. Employment;2. Credit;3. Housing; and4. Voting.



1.UCLA School of Law-A New Way of Life Prisoner Re-Entry Initiative

2.The Constitution Project—Ginnie Sloan, President

3.NationalHelping Individuals with Criminal Records Re-enter through Employment Network

4.National Employment Law Project5.National Reentry Consortium6.Reentry.net7.The Safer Foundation—

Diane Williams, CEO

Serving People from Arrest to Reintegration



RECIDIVISM STATISTICS

• The U.S. Department of Justice tracked the rearrest, re-conviction, and re-incarceration of former inmates for 3 years after their release from prisons in 15 States.

• Crimes with the highest re-arrest rates were • Robbery (70.2%), • Burglary (74.0%), • Larceny (74.6%), • Motor-vehicle theft (78.8%), • Possession or selling of stolen property

(77.4%), & • Possession/use/sale of illegal weapons

(70.2%).

http://en.wikipedia.org/wiki/United_States_Department_of_Justice


• Nearly 70% of drug-abusing offenders return to prison within three years of their release. (Langan & Levin, 2002)

RECIDIVISM STATISTICS


DRAMATIC INCREASEDramatic Increase in

Negligent-Hiring Claims, and…

• Employers lose 70% of negligent-hiring cases

• Average jury verdict in such cases is $1.6 million


A BALANCING TEST•Potential liabilities if you hire…

•Potential liabilities if you don’t…


“GOLDEN RULES”• Criminal-background checks may violate anti-discrimination laws if conducted incorrectly.

• A federal decision in the 3rd Circuit Court of Appeals in 2007, styled El v. SEPTA, marked a serious departure from past treatment, stating that “common sense”-type reasoning is not enough to survive a discrimination lawsuit.


“GOLDEN RULES”• In El v. SEPTA, the court said that criminal-risk-based screening, while legally permissible, requires the employer to show it analyzed the risk both qualitatively and quantitatively. a) The qualitative assessment

considers what the harm could be for a specific job.

b) The quantitative assessment considers the likelihood that the harm will occur.


RECIDIVISM – WITHIN 3 YEARS•650,000 released inmates/yr.

•More than half (51.8%) back in prison

•61.7% rearrested for violent crimes regardless of what their offense was

•Nearly 70% (67.8%) arrested[More than 80% of crimes go unsolved]


RACIAL ISSUE?YES – But in the right direction:

•11.2% of jobs filled by African-American males when employers do criminal-background checks

•Only 3.3% when they do not


RACIAL ISSUE?Overall, employers doing criminal-background checks are more than 50% more likely to hire African-Americans than employers who do not (24% versus 14.8%)


THREATSThreats to Employer Rights to do Criminal-Background Checks•Federal Administration•State legislation•Private lawsuits•Public lawsuits•American Bar Association resolutions


There has been significant state activity in:

• Oregon;• Pennsylvania;• Connecticut;• Massachusett

s; • Minnesota;• New Jersey;• Ohio; • Hawaii, et al.

STATE AND LOCAL DEVELOPMENTS

http://images.google.com/imgres?imgurl=http://www.cftech.com/BrainBank/GEOGRAPHY/maps/Pennsylvania.jpg&imgrefurl=http://www.cftech.com/BrainBank/GEOGRAPHY/Pennsylvania.html&usg=__23Mh_anQk3R6bJI5YkkVMdOrKzk=&h=704&w=1056&sz=238&hl=en&start=9&sig2=SZ7cY5NQ3a_pPXly9Ww9sA&itbs=1&tbnid=E7URZZB_RfzWUM:&tbnh=100&tbnw=150&prev=/images?q=pennsylvania&hl=en&tbo=1&gbv=2&tbs=isch:1&ei=Q_2gS_6pJIT6lwfvtpmgDA

http://images.google.com/imgres?imgurl=http://students.umf.maine.edu/~lolaam/oregon.gif&imgrefurl=http://students.umf.maine.edu/~lolaam/Demographics.html&usg=__uBjl43aO88Aa1YRw5dT-sOYLt1E=&h=322&w=435&sz=12&hl=en&start=8&sig2=BhS2hMls8cZ0uCogpUbaZQ&itbs=1&tbnid=dw6UOFpa4SdZSM:&tbnh=93&tbnw=126&prev=/images?q=oregon&hl=en&tbo=1&gbv=2&tbs=isch:1&ei=rv2gS9iYFYGClAfT_6m5DA


•Criminal-background checks & credit-background checks face parallel threats, with credit checks being a harbinger.



• In the past couple of years, about 20 states have considered bills to limit the use of credit report data for employment screening.

• These include: California, Connecticut, Florida, Georgia, Indiana, Kentucky, Michigan, Missouri, Montana, Nebraska, New Jersey, New Mexico, New York, Ohio, Pennsylvania, Texas, and Vermont.



1. Convictions within the past 10 years; 2. Bearing a rational relationship to the

duties and responsibilities of the position; and

3. Only after a conditional offer of employment has been made.

In 1998, Hawaii’s Act 175 limited employers’ criminal-historyinquiries to:

1998

TIMELINE OF OBSTACLES


City of Chicago Hiring Guidelines• Chicago Dept of Human Resources —

as recommended by the Mayoral Policy Caucus on Re-entry — removed the criminal history question from its employment applications, and deferred the criminal-background check until later in the process.

• What you see government imposing on itself is a harbinger of what you will see government trying to impose on the private sector.

Feb. 2007



• In 2007, Connecticut passed an anti-criminal-background-check law as an eleventh-hour amendment to an unrelated bill.

• The effective date was delayed, and the bill was subsequently repealed.

2007



• It was widely reported that a Connecticut school district hired a convicted pedophile as a teacher/coach.


2007


• The ABA considered endorsing bans/restrictions on criminal-background checks, but these repeated efforts fortunately fell short.

(Sometimes)


2003-Present


• U.S. Conference of Mayors convened a ground-breaking national summit on 2-28-08 designed to promote effective strategies for connecting formerly incarcerated individuals to the labor market.

February 28, 2008



RECOMMENDATIONS: EMPLOYMENT

1. Create a federal human rights standard prohibiting flat bans against hiring qualified people with criminal histories;

2.Prohibit employers from “inquiring about or using information about arrests that did not lead to conviction or missing dispositions on criminal record reports issued by the Federal Bureau of Investigation (FBI).”

Legal Action CenterNational H.I.R.E. NetworkOctober 2008




3. Enact a federal standard

for employers based on EEOC recommendations on the use of background checks;

• [EEOC Chair Stuart Ishimaru has proposed – and strongly supports – this.]





4. Require a criminal-record waiver/appeal process for inaccuracy challenges, rehabilitation evidence, and mitigating information;

5.Designate an independent body, rather than individual employers, to make fitness determinations; and

6.Graduate consideration of criminal record based upon severity of crime; and/or passage of time (e.g. seven years).




• EEOC holds a hearing to entertain views on how employers actually use criminal records in making employment decisions and on how EEOC should revise its compliance manual.

• EEOC circulates new draft guidance on background checks in employment decisions.

• Timetable for the guidance is uncertain.

November 2008

November, 20, 2008



DIANE WILLIAMS• CEO of the Safer Foundation in Chicago, nonprofit helping ex-offenders find jobs.

• ADVOCATES CHICAGO’S “BAN THE BOX” — removing the criminal conviction question from the employment application and only utilizing it later in the process.

Diane Williams

November 20, 2008



•Municipalities adopting “ban the box” include:

1. Chicago,2. Boston,

3. San Francisco,4. Baltimore,

5. Minneapolis,6. St. Paul,

7. Philadelphia

•Numerous other municipalities are considering “ban the box”

Current



Diane Williams: • Gov’t should ask about employers' background-

check policy in whether to award a government contract.

• EEOC needs to prohibiting employers from using info about arrests that did not lead to conviction.

• Federal standards should be adopted, based on the EEOC guidance saying “business necessity” must involve :A. The nature of the crime, B. Time elapsed since the crime/prison release, & C. The nature of the job at issue.

Diane Williams

November 20, 2008



1. Include Hawaii Department of Education (including the state public library system) volunteers in close proximity to children; and

2. Require the Department to establish & maintain a criminal-history database for internal use.

Introduced 1/21/09, Hawaii’s stalled (assertedly as too costly) SB 16 attempts to EXPAND employers’ criminal-historyinquiries to:

January 21, 2009



• Ex-offenders’ advocates seek federal legislation to restrict employers’ criminal-background checks.

• Rep. Bobby Scott (D-VA) chairs

the U.S. House Judiciary Subcommittee on Crime, Terrorism, and Homeland Security.

• The summit was orchestrated by Ginnie Sloan, President of The Constitution Project.

Rep. Scott headed up a 3-3-09 “summit” on criminal-offender re-entry issues/legislation.

Rep. Bobby Scott


March 3, 2009


• Manpower posted this ad for an April 1st, 2009, hiring day at the Alameda (California) One Stop Career Center for 600 Bank of America seasonal jobs.

March 2009



• On American Bar Association call Acting Chair Stuart Ishimaru reiterates EEOC is continuing to examine need for more guidance on employers’ use of criminal records and credit histories.

April 8, 2009



• EEOC Acting Chair Stuart Ishimaru states on an American Bar Association conference call that,

“We're looking at possible litigation vehicles that may be ways to look at this problem as well.”

April 8, 2009



• On June 9, 2009, NELP wrote the EEOC re this ad.

• 15 groups total signed the letter, including the Leadership Conference for Civil Rights.

• The groups seeks limits on criminal-history checks.

”

”

“

“

June 9, 2009



• US Chamber sends alert re EEOC complaint on alleged disparate impact of using credit & criminal history background checks in hiring.

• EEOC reached back to 2001, when complainant applied for job in 2007.

• Freeman Company believes their situation is being used as a test case by the EEOC.

July 31, 2009



• Have you have had similar EEOC issues?

• Is EEOC becoming more aggressive in challenging employment criteria?

• Does this have broader implications beyond pre-employment screening & background checks to ANY subjective criteria?

July 31, 2009



• EEOC Acting Chair Stuart Ishimaru makes good on his statement that the EEOC was looking at possible litigation vehicles by filing suit in EEOC v. Freeman (referenced in the US Chamber’s alert).

Sept. 30, 2009



• The PHRC invites comments on its proposed guidance presuming the disparate impact element of a prima facie case of unlawful discrimination under the Pennsylvania Human Relations Act (PHRA).

• Should an employer reject a Black or Hispanic applicant because of his or her criminal record, the PHRC would presume the rejection is due to discrimination.


Nov. 27, 2009


• Could significantly constrain PA employment background checks, hampering efforts to provide safe work environments for employees and others.

• Certain regulated industries are prohibited by statutory, regulatory & court authority from employing individuals convicted of specific offenses.


Nov. 27, 2009


• The PHRC would allow the presumption of disparate impact to be rebutted by employers, “upon an appropriate showing of relevance, with conviction data from a more limited geographical boundary than the Commonwealth of Pennsylvania (e.g. the relevant city, census region, or county) or conviction data for the specific crimes being screened by the respondent.”


Nov. 27, 2009


Letter from Pennsylvania Attorney General to PHRC

March 9, 2010



• ALEC’s Commerce, Insurance, and Economic Development Task Force adopts a policy, drafted by Jackson Lewis, supporting the freedom of employers to perform background checks.


http://www.alec.org/AM/Template.cfm?Section=Home


• In January 2011, the U.S. Attorney General convened a Cabinet-level federal interagency Reentry Council.

• The Council represents significant Administration commitment to coordinating reentry efforts and developing effective reentry policies.


January, 2011

• The first meeting included 7 Cabinet officials and other key Administration leaders from 18 departments & agencies.

• EEOC Chair Berrien has been active.



January, 2011

REENTRY COUNCIL GOALS(http

://www.nationalreentryresourcecenter.org/)• To identify research and evidence-based practices, policies,

and programs that advance the Reentry Council’s mission around prisoner reentry and community safety.

• To identify Federal policy opportunities and barriers to improve outcomes for the reentry population.

• To promote Federal statutory, policy, and practice changes that focus on reducing crime and improving the well-being of formerly incarcerated individuals, their families and communities.

• To identify and support initiatives in the areas of education, employment, health, housing, faith, drug treatment, and family and community well-being that can contribute to successful outcomes for formerly incarcerated individuals.

• To leverage resources across agencies that support this population in becoming productive citizens, and reducing recidivism and victimization.

• To coordinate messaging and communications about prisoner reentry and the Administration’s response to it.

http://www.nationalreentryresourcecenter.org/




• Senators Patrick Leahy (D-VT) and Rob Portman (R-OH) in June 2011 introduced S. 1231, the Second Chance Reauthorization Act of 2011.

• Judiciary Cmte reported it in July 2011.

• This bill does NOT currently address background checks, but COULD serve as a vehicle for such because it is backed by many of the same groups pushing the reentry agenda of limiting background checks.


July 21, 2011


• Meeting of July 26, 2011 - EEOC to Examine Arrest and Conviction Records as a Hiring Barrier

• Awful 8 to 1 witness ratio

July 26, 2011



HOUSE JUDICIARY COMMITTEE

• Staff discusses background checks

• Oversees civil liberties generally &1.Bureau of Justice Statistics

data,2.U.S. Commission on Civil

Rights,3.DOJ Civil Rights Division

• Does NOT oversee EEOC• Says no hearings likely this

year• Might consider oversight

hearing for next year

July/August,

2011

HOUSE OF REPRESENTATIVES

Committee JurisdictionBudget Views & Estimates


HOUSE ED & WORKFORCE CMTE

• John Kline, Minnesota (Chairman)• Has not committed definitely to any background-

check hearings

Health, Employment, Labor, and Pensions Subcmte

• Phil Roe, Tennessee (Chairman)• Robert Andrews, New Jersey (Ranking Member) • has jurisdiction over

1. Bureau of Labor Statistics,2. EEOC, and 3. All matters related to equal employment

opportunity and civil rights in employment.

HOUSE OF REPRESENTATIVES


EEOC COMMENT BY 4 ATTORNEYS GENERAL

Comment from AR, RI, GA & WI AG’s


EEOC COMMENT BY 4 ATTORNEYS GENERAL

Key Point from AR, RI, GA & WI AG’s

“EEOC’s current policy, in place since 1987, strikes an appropriate balance between employers needs to ensure the safety of coworkers and customers on one hand, and the interests of existing and prospective employees in avoiding illegal discrimination on the other hand.”


COMMENT FROM ~60 EMPLOYER GROUPS

Key Point from Employer Groups

“As long as there is workplace violence, fraud, theft and a need to protect vulnerable populations, there will always be a need to review the criminal histories of applicants for certain positions.”


THE BOTTOM LINEDO NOT CURTAIL BACKGROUND CHECKS!

Legislatures should NOT enshrine in law a FALSE presumption of discrimination in employers’ criminal-history policies.


•More information regarding decision-making is a good idea.

THE BOTTOM LINE


INVITE TO JOIN ~80 EMPLOYER GROUPS

Given your interest in the EEOC’s ongoing review of its 1987 guidance, we invite you to a meeting to discuss the activities of this ad hoc group and what the challenges may mean for your ability to rely on criminal background checks to make informed decisions and protect persons and property in the workplace and elsewhere. The meeting will take place at 3 p.m. on Wednesday, September 14, 2011 at the Venable law firm, 575 7th St NW., Washington, D.C.

Please let Aloysius Hogan, Jackson Lewis, [email protected], and Eric Ellman, CDIA, [email protected], know no later than Thursday, September 8, whether you will be able to attend this important meeting.

We have provided you with a link to the CDIA website (http://www.cdiaonline.org/Links/content.cfm?ItemNumber=10934) for additional information on the EEOC process, comments filed with the EEOC, and an outreach paper from CDIA, Creative Services, LexisNexis, and NAPBS.

mailto:[email protected]

mailto:[email protected]

http://www.cdiaonline.org/Links/content.cfm?ItemNumber=10934

http://www.cdiaonline.org/Links/content.cfm?ItemNumber=10934

http://www.mmsend57.com/link.cfm?r=784734307&sid=15373976&m=1529413&u=CDIA&j=7181782&s=http://www.cdiaonline.org/index.cfm?unItemNumber=514

http://www.mmsend57.com/link.cfm?r=784734307&sid=15373977&m=1529413&u=CDIA&j=7181782&s=http://www.creativeservices.com/

http://www.mmsend57.com/link.cfm?r=784734307&sid=15373978&m=1529413&u=CDIA&j=7181782&s=http://www.lexisnexis.com/

http://www.mmsend57.com/link.cfm?r=784734307&sid=15373979&m=1529413&u=CDIA&j=7181782&s=http://www.napbs.com


QUESTIONS???


COUNCIL FOR EMPLOYMENT LAW EQUITY

• The Council for Employment Law Equity is a 501 (c)(6) working for employers’ rights in background checks, arbitration in employment, and other employment-policy issues.

The Assault on Criminal-Background Checks

Presented by:Aloysius Hogan, Of Counsel & Registered LobbyistJackson Lewis LLPCell: 202-957-9400Email: [email protected] toAlarm Industry Communications Committee MeetingKey Bridge Marriott in Arlington, VirginiaSeptember 8, 2011

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