Employment Decisions Archives

Rhode Island is the latest state to “ban the box”

On July 16, 2013, Rhode Island’s SB357 was signed into law, making it the eighth state to pass “ban the box” legislation. Effective January 1, 2014, the law, with a few exceptions, will make it an “unlawful employment practice” for an employer in the state to inquire whether an applicant has ever been convicted of a crime before the ﬁrst interview. In “banning the box” for private employers, Rhode Island follows on the heels of Hawaii, Massachusetts, and Minnesota, as well as the cities of Seattle, Buffalo, Philadelphia, and Newark. And many more jurisdictions have already “banned the box” for public employers and public contractors, and even more have some form of the legislation under consideration. Congress too is pondering its federal HR 6220 or “Ban the Box Act” introduced last July, which similar to these state and local laws, would make it illegal for an employer to ask about criminal history in an interview or on an employment application.

|Employment Decisions, Legislation|

State and local laws for employment-related protection to ex-offenders continue to grow

A new Indiana law (House Enrolled Act 1482) that prohibits employers from asking about or otherwise considering expunged or sealed arrest and conviction records goes into effect July 1, 2013. And a similar North Carolina law (SB 91) takes effect December 1, 2013.

The City of Buffalo too is giving ex-offenders increased employment opportunities with its May 28, 2013 ordinance which amends Chapter 154 of the Code of the City of Buffalo by prohibiting public and private employers and city vendors from asking job candidates about their criminal conviction history during the application process and prior to the first interview. And a new “ban the box” ordinance has been unanimously adopted in Seattle on June 10, 2013 that will give ex-offenders special rights in the job application process. Seattle’s Council Bill 117796 provides for administrative enforcement but affords no private right of action.

Indiana and North Carolina, and Buffalo and Seattle, are just the latest additions to the fast growing list of states and municipalities that regulate the use of criminal records in employment decisions. And pending before Congress is the federal HR 6220 or “Ban the Box Act” introduced last July, which similar to these state and local laws, would make it illegal for an employer to ask about criminal history in an interview or on an employment application.

|Employment Decisions, Legislation|

New Texas law limits negligent hiring and negligent supervision suits against employers

Rather than denying employers access to potentially consequential information about a candidate’s criminal past, a new Texas law is striving to curb lawsuits against employers. Signed into law on June 14, 2013 and effective September 1, 2013, HB 1188 amends the Texas Civil Practice and Remedies Code to prohibit most causes of action “against an employer, general contractor, premises owner, or other third-party solely for negligently hiring or failing to adequately supervise an employee, based on evidence that the employee has been convicted of an offense.”

Notably, the statute provides exceptions that allow claims if the employer knew or should have known its employee was convicted of: (1) an offense “that was committed while performing duties substantially similar to those reasonably expected to be performed in the employment, or under conditions substantially similar to those reasonably expected to be encountered in the employment;” (2) a sexually violent offense; or (3) certain offenses specified in the Texas Code of Criminal Procedure, Article 42.12- Section 3g including but not limited to murder, indecency with a child, aggravated kidnapping, aggravated sexual assault, and aggravated robbery.

The protections under this statute do not apply in actions “concerning the misuse of funds or property of a person other than the employer, general contractor, premises owner, or third party by an employee if, on the date the employee was hired, the employee had been convicted of a crime that includes fraud or the misuse of funds or property as an element of the offense, and it was foreseeable that the position for which the employee was hired would involve discharging a fiduciary responsibility in the management of funds or property.”

|Employment Decisions, Legislation|

EEOC files suits against two employers for use of criminal background checks

The Equal Employment Opportunity Commission (the “EEOC”) announced on June 11, 2013 that it filed lawsuits against two large employers accusing them of using criminal background checks to illegally discriminate against African American workers. The EEOC alleged that the companies, by requiring contracted employees and prospective employees to submit to criminal background checks, violated Title VII of the Civil Rights Act of 1964’s prohibition against race discrimination.

“Title VII of the Civil Rights Act of 1964 prohibits discrimination against job applicants and employees on account of their race,” said EEOC Chair Jacqueline A. Berrien. “Since issuing its first written policy guidance in the 1980s regarding the use of arrest and conviction records in employment decisions, the EEOC has advised employers that under certain circumstances, their use of that information to deny employment opportunities could be at odds with Title VII.” The EEOC issued updated enforcement guidance on employer use of arrest and conviction records in April 2012.

|Employment Decisions, Lawsuit|

Nevada is the latest state to restrict employment-purpose credit reports

On May 25, 2013, SB 127 was signed into law adding Nevada to the fast-growing list of states that restrict employment-purpose credit reports. Nevada’s new law, which goes into effect October 1, 2013, follows closely the recently enacted legislation in Colorado. Eight other states (California, Connecticut, Hawaii, Illinois, Maryland, Oregon, Vermont and Washington) have similar laws that limit the employers’ use of credit history in personnel decisions. Aggressive legislative efforts are likely to continue, as Florida, New Jersey, and Pennsylvania are considering similar legislation. But the most restrictive bill yet is pending before the New York City Council. It would prohibit employers from using credit reports in hiring except in few instances where such checks are required by law.

|Employment Decisions, Partnership|

Minnesota becomes the latest state to restrict employment criminal checks

On May 13, 2012, Minnesota became the latest state to restrict criminal background checks for employment purposes with its Criminal Background Check Act (S.F. No. 523). Under the new law, which will go into effect on January 1, 2014, public and private employers may not inquire about, consider or require disclosure of an applicant’s criminal history until after the applicant has been granted an interview or before a conditional offer of employment is made. Since 2009, Minnesota law prohibited only public employers from asking about criminal records on job applications.

According to a report from the National Employment Law Project (the “NELP”) dated in April 2013, six states and 50 localities have adopted “Ban the Box” legislation. And pending before Congress is the federal HR 6220 or “Ban the Box Act” introduced last July by Representative Hansen Clarke (D-MI-13) which similar to these state and local laws, would make it illegal for an employer to ask about criminal history in an interview or on an employment application.

|Employment Decisions, Legislation|

Colorado joins list of states that restrict credit report use for employment

Although the FCRA allows employers to consider credit reports for employment purposes, state laws that are more protective of employee rights trump the federal law. Eight states (California, Connecticut, Hawaii, Illinois, Maryland, Oregon, Vermont and Washington) and at least one locality, the City of Chicago, limit the employers’ consideration of credit history in personnel decisions. And Colorado was just added to this list with its S.B. 18 that was signed into law on April 19, 2013. Aggressive legislative efforts are likely to continue. The most restrictive bill yet is pending before the New York City Council. It would prohibit employers from using credit reports in hiring except in few instances where such checks are required by law.

|Employment Decisions, Legislation|

Proposed New Jersey bills restrict use of criminal records in employment decisions

In February 2013, identical bills aimed at reducing employment discrimination against individuals with criminal histories were introduced in the New Jersey Senate (S2586) and the New Jersey Assembly (A3837). Both bills propose the adoption of the Opportunity to Compete Act (the “Act”) which would impose multiple restrictions and requirements on employers in connection with seeking and using criminal background information about job applicants. If the Act is adopted, New Jersey will join a growing list of states, cities, and localities which have passed similar anti-discrimination legislation.

|Employment Decisions, Legislation|

Revamped Form 1-9 makes its debut

On March 8, 2013, the U.S. Citizenship and Immigration Services (the “USCIS”) announced that its newly revised Form I-9 is to be used immediately. Notably, as indicated in the Federal Register, the USCIS granted companies until May 7, 2013 to implement the new form, which purportedly has been designed to minimize completion errors. This 60-day grace period allows employers time to adjust their human resource processes, and modify their software. The USCIS has also updated its “Handbook for Employers – Guidance for Completing the Form I-9” (3.8.13 version) to correspond to the new form, and is holding webinars to educate companies in the form’s usage.

The USCIS noted that employers do not need to complete the new form for employees for whom they already have a proper Form I–9 on file, unless re-verification applies. Unnecessary verification may violate the anti-discrimination provision of section 274B of the INA, 8 U.S.C. 1324b, which is enforced by the DOJ’s Office of Special Counsel for Immigration Related Unfair Employment Practices.

|Educational Series, Employment Decisions|

No shortcuts to assuring maximum possible accuracy under the FCRA

When Congress formulated the Fair Credit Reporting Act (“FCRA”) more than 30 years ago, it noted that the law was enacted in order to protect consumers against “the trend toward…the establishment of all sorts of computerized data banks

[that placed a consumer] in great danger of having his life and character reduced to impersonal ‘blips’ and key punch holes in a stolid and unthinking machine which can literally ruin his reputation without cause [116 Cong. Rec. 36570].” This intent has been clearly supported by the amendments that followed allowing greater and more effective protection. But despite the leaps and bounds in legislation, much controversy still exists about the level of protection that this law provides to consumers. And confusion abounds about the compliance requirements for consumer reporting agencies (“CRAs”) on whom the FCRA places “grave” compliance obligations. “There is a need to insure that consumer reporting agencies exercise their ‘grave’ responsibilities with fairness, impartiality, and a respect for the consumer’s right to privacy [15 U.S.C. § 1681(a)(4) (2006)].”

The FCRA mandates that “[w]henever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates [15 U.S.C. § 1681e(b)].” So what does this mean? Courts have taken two positions in interpreting the language of this section. The “consumer-friendly” version holds CRAs liable for reports that are technically accurate, but may be misleading or incomplete. (Koropoulos v. Credit Bureau, Inc., 734 F.2d 37, 40; D.C. Cir. 1984: “Congress did not limit the Act’s mandate to reasonable procedures to assure only technical accuracy; to the contrary, the Act requires reasonable procedures to assure maximum accuracy.”) The “business friendly” interpretation requires only technical accuracy in the CRA’s reporting. [Todd v. Associated Credit Bureau Servs., Inc., 451 F. Supp. 447, 449 (E.D. Pa. 1977)].

While this case law is helpful in understanding the CRA’s liability under the statute, there is no doubt that a comprehensive guidance on the methodology to assure maximum accuracy is still much needed especially in view of the proliferation of the so-called “national databases” in the recent years. But despite the lack of clear guidance, a reputable CRA knows that “to assure” means “to earnestly inform or tell positively; state with confidence.” And reporting a record that was identified by name only or relying solely on private database record information in an employment background check does not pass the reasonable procedures test by any standard.

In an Internet marketplace that touts instant results, a CRA’s practice of sending searchers to the courthouse, pulling dozens of cases, and reviewing legal documents to ascertain correct subject identification and record information may be counterintuitive for many employers. And it takes time and money to assure the most accurate and up-to-date results. On the other hand, in a world of over a million people, is a quick and cheap database background search of any real value?

|Employment Decisions|