On June 10, the House Subcommittee on Workforce Protections heard testimony regarding the Equal Employment Opportunity Commission’s (EEOC) controversial background check guidance. Comments focused on the difficulties faced by employers in seeking to comply with the guidance, the potential risks to consumers and other employees when excluding applicants from certain positions, and the EEOC’s overly aggressive stance toward employers in devising and enforcing its policies.

The EEOC background check guidance, issued on April 25, 2012, took the position that due to the increased incarceration rates among certain minority groups, some hiring practices may violate Title VII under a “disparate treatment” or “disparate impact” theory. According to the EEOC, if an employer's policy can be shown to have a disparate impact on employees/applicants of a protected race or national origin, the employer must demonstrate that the challenged practice is job related for the position in question and consistent with business necessity. In reaching this determination, the guidance suggests that the employer should conduct an individualized assessment of the candidate, taking into account factors such as the number of offenses for which the individual was convicted, age at conviction and whether the individual performed the same type of work (post conviction) for a different employer without incident. Other factors to consider are the length and consistency of employment history before and after the conviction, rehabilitation efforts and employment/character references.

The guidance was immediately controversial with many, including representatives from the National Small Business Association and the U.S. Chamber of Commerce, questioning how it was to be implemented in practice. Of particular concern is that the guidance stated compliance with state law could not be considered a valid defense to a charge of discrimination. There was also testimony from a family member whose loved one was murdered during a service call to her home. The technician was an ex-convict who had not been subject to a background check.

At the hearing, Todd McCracken, President of the National Small Business Association focused on the difficulty small businesses owners may have in interpreting it. He stated that the guidance was so “opaque” that it “is not guidance at all.” McCracken explained that he had spoken with many sophisticated attorneys who struggle to understand the guidance, and “it is a rare small business owner who is going to be able to read, absorb and apply the 55 page, 167 footnote [Guidance].” Further, he pointed to the Catch 22 small business owners find themselves in when having to choose between following state background check rules and the EEOC guidance, not to mention the potential legal exposure they face from negligent hiring claims.

An attorney speaking on behalf of the US Chamber of Commerce, Camille Olson, also spoke to the difficulty of interpreting the regulations, as well as abuses by the EEOC in enforcement. Olson pointed to the EEOC’s abusive investigative tactics, its failure to thoroughly investigate charges before bringing suit and litigating disparate impact cases without sufficient statistical support, noting that these practices had resulted in $5.6 million in sanctions over the past two years. According to Olson, these abuses, combined with the Supreme Court’s 2013 rejection of two long-held substantive positions taken by the EEOC (including its definition of “supervisor” and its rejection of a “but for” causation requirement in retaliation cases), illustrate that the EEOC “has abandoned its role as neutral enforcer of the plain language of the law to an overly aggressive litigant, seeking to make law through cases, not legislation.” She stated that this position was evident in the background check guidance, as it failed to explain the basis for requiring an individualized assessment, to provide any guidance in reconciling the guidance with state law, and failed to address employer concerns about consumer and workplace safety.

The long-term impact of this testimony remains to be seen, but it is a significant step in drawing attention to some of the more controversial positions taken by the EEOC in recent years. The full testimony of the witnesses at the hearing is available at:http://edworkforce.house.gov/calendar/eventsingle.aspx?EventID=383368