Announcement for 01/31/12
In Settlement, EEOC Clarifies Law on Employer’s Use of Arrest and Conviction Records in Hiring Process
By Matthew Schwarzfeld, Council of State Governments Justice Center
The Equal Employment Opportunity Commission (EEOC), the federal agency that enforces the nation’s laws against employment discrimination, recently announced an important settlement regarding criminal background checks for job seekers. The settlement with Pepsi Beverages signals the EEOC’s increasing commitment to ensuring that background check policies comply with the nation’s civil rights laws.
The agency had been investigating charges that Pepsi’s background check policy discriminated against African American job candidates. Pepsi’s old policy screened out applicants who had been arrested but never convicted, applicants convicted for minor offenses, and applicants convicted decades earlier. The EEOC found that Pepsi’s policy violated Title VII of the 1964 Civil Rights Act, which prohibits any form of employment discrimination based on race, gender, national origin, and other protected categories.
The EEOC based its finding of a Title VII violation on the fact that African Americans are more likely to be barred by Pepsi’s old policy than other demographic groups. According to the FBI’s annual crime report, African Americans represent 28.3 percent of all arrests in the United States—yet only 12.9 percent of the U.S. population.
The EEOC’s attention to the collateral consequences of arrests and convictions complements the agency’s work with the Federal Interagency Reentry Council, a Cabinet-level group convened by U.S. Attorney General Eric Holder to examine all aspects of reentry – including employment access for individuals with criminal records.
“We consider ensuring equal employment opportunity to be a critical part of the reentry conversation,” said Todd A. Cox, Director of the EEOC’s Office of Communications and Legislative Affairs and a member of the Reentry Council. “Engaging on reentry issues with a broad range of federal agencies through the Federal Interagency Reentry Council helps us in our work to eliminate unnecessary barriers to employment. The Reentry Council gives us additional tools and a forum to have that conversation.”
The EEOC settlement with Pepsi comes at an important moment in the discussion around employer’s use of criminal background checks. According to a 2010 survey by the Society for Human Resources Management, 92 percent of employers conduct criminal background checks on some or all job applicants, up from 51 percent in 1996. More than two-thirds of states allow hiring and professional-licensing decisions to be made on the basis of an arrest alone. Yet these policies eliminate a significant portion of job applicants before they even enter the door. Almost one-third of all Americans have been arrested by the age of 23, according to a 2011 study published in the journal Pediatrics.
“Many employers, large and small, refuse to hire qualified people if they have a criminal record, no matter how old or minor the offense, and the trend is only picking up with the rise in background checks,” said Maurice Emsellem, Policy Co-Director with the National Employment Law Project, which recently published a report that estimated that background check policies deny access to employment to as many as 65 million Americans. “The good news is that the EEOC and advocates across the country are fighting back by more aggressively enforcing the nation’s anti-discrimination laws, which balance the legitimate concerns of employers to keep the workplace safe with the civil rights of qualified workers struggling to find work in today’s economy.”
Advocates like Emsellem have noted that the problem with Pepsi’s policy was that it was overly broad. “Blanket” background check policies like Pepsi’s violate Title VII’s requirement that employers take into account the specific job responsibilities and the nature of the individual’s record.
“Employers should have a choice when making hiring decisions, and job seekers should have an opportunity to speak about their records for themselves,” said Mindy Tarlow, Executive Director for the Center for Employment Opportunities. “With this kind of blanket ban, job candidates never get in the front door and don’t have any chance to explain their situation.”
The importance of the EEOC settlement with Pepsi goes beyond its specific terms – which include Pepsi agreeing to pay $3.13 million to 300 African Americans who were denied employment as well as Pepsi modifying its hiring policy, reconsidering the candidacies of previously denied candidates, and conducting Title VII training for its hiring personnel.
“This settlement is going to put the ‘fear of god’ into hundreds or even thousands of corporations. Like the IRS, who every March picks a few tax evaders and cracks the book on them to send a deterrent message to everyone else, the EEOC has sent a message,” said Al Blumstein, a criminology professor at Carnegie Mellon University who recently published on op-ed in the New York Times arguing against blanket background check policies. “I anticipate that lots of companies are going to look at their hiring policies to make sure they’re accommodating the EEOC’s requirements and expectations.”
One of the unique aspects of this case was that the EEOC and Pepsi mutually agreed to make the settlement public. The EEOC only rarely makes its settlements public—and has never publicly disclosed a settlement regarding arrest and conviction records.
“The fact that the settlement was made public when it didn’t have to be will have a significant impact on raising awareness about the issue among employers,” said Tarlow. “I honestly believe there is a genuine lack of understanding about what the law is and what companies are and are not allowed to do. The more this issue surfaces, the better.”
The EEOC first turned its attention to the issue in the mid-1980s, when it stated that criminal background checks disproportionately impacted African Americans and Latinos because of their overrepresentation in the criminal justice system. Last July, the agency’s commissioners met to examine how the widespread use of criminal background checks has impacted workers of color in today's economy.
“The Pepsi case and others like it send a strong message to both large and small employers that these requirements exist and that it’s time for them to revisit their hiring policies,” Emsellem said. “Yet there’s still a long way to go to enforce Title VII protections for people with criminal records. If big employers like Pepsi are getting it wrong, you know there’s a real problem with how the law has been understood.”