A federal district court in Maryland has thrown out the EEOC’s lawsuit against an event planning company for using criminal and credit information in hiring decisions. EEOC v. Freeman, No. RWT 09cv2573 (D. Md. Aug. 9, 2013). The EEOC sued the company, alleging that the use of criminal and credit background checks violated Title VII. On the employer’s motion for summary judgment, the court identified numerous inaccuracies, deficiencies, and biases in the EEOC’s expert statistical evidence. The court also faulted the EEOC for failing to identify specifically at which point in the company’s multi-step use of background information the alleged disparate impact occurred. The court rebuked the EEOC for bringing an unsupported lawsuit that placed employers in the lose-lose position of choosing between risking liability by ignoring criminal and credit history and “incurring the wrath of the EEOC” by using the information. In the court’s opinion, criminal and credit history was a “rational and legitimate component” of the hiring process.
The EEOC recently filed two complaints against other companies challenging their use of criminal background checks in hiring. We look forward to more judicial guidance as courts weigh in on those complaints.