EEOC Issues Guidance Regarding Employer Use of Criminal Background Checks


All Employers, Employment Agencies and Unions


EEOC Guidance, upon issuance, April 25, 2012

New Notices, January 1, 2013


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On April 25, 2012, the EEOC voted to adopt new guidance for employers that use information on criminal convictions in their hiring process. The EEOC opined that, because arrest and conviction rates are higher among minorities than the general population, employers’ practices of rejecting anyone with a criminal record may have a disparate impact on minority candidates. This guidance applies to criminal convictions, not arrests, in that the EEOC’s position is that arrests that did not result in convictions should not be used in hiring decisions.

According to the EEOC, employers must consider whether or not the conviction is “job-related and consistent with business necessity”. As a result, it is important for employers to restrict blanket refusals to only a specific class of job. For example, a financial services provider may refuse to hire employees with recent theft convictions for certain positions.

Employers should review their criminal background check policy and ensure hiring officials and other managers are trained in the policy.

New Notices are Required Under the FCRA Effective January 1, 2013

In addition to the EEOC’s guidance, the Consumer Financial Protection Bureau (CFPB) recently issued regulations and new notices for background check programs. Under the Fair Credit Reporting Act (FCRA), employers obtaining consumer reports must disclose in writing to applicants or employees that a consumer report may be obtained and the applicant or employee must provide written permission for the employer to obtain a consumer report for employment purposes.

The new regulations provide that if an employer takes any adverse action against and applicant or employee based in whole or in part on information contained in the report, the employer must follow a two-step process which includes a “pre-adverse action” notice to the individual along with a copy of the report and the FCTA Summary of Rights. After waiting the required time, if the employer takes adverse action, it must provide an “adverse action” notice to the individual along with information required by the statute and contact information for the consumer reporting agency.


Action Items:

  1. Review your criminal background check policy and if necessary, revise the policy. Review blanket exclusions and instead consider the nature and extent of the offense; when the offense occurred, and the nature of the job.
  2. Your policy should provide for individual assessments, consideration of the essential job requirements, and the circumstances under which work is performed.
  3. Train decision makers and other managers on the policy and procedure.
  4. Be prepared to defend your policy with research that justifies the rationale behind adverse decisions.
  5. Update FCRA notices before January 1, 2013.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2012 ManagEase, Incorporated.

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