Through various press releases, speeches, and public meetings, the EEOC has expressed its increased concern over employers utilizing applicants' criminal and/or credit histories for screening purposes. The agency bases its concerns in this regard, in part, on statistical evidence suggesting that minorities are disproportionately arrested for and convicted of crimes and have more problematic credit histories than non-minorities. Pursuant to its E-RASE initiative (Eradicating Racism & Colorism from Employment), the EEOC warns that it is developing and implementing investigative and litigation strategies to address employers' selection criteria and methods that may foster discrimination based on race, color, and other prohibited bases.

According to the EEOC, employers should avoid blanket exclusions that prohibit employment of individuals with criminal records or who have particular types of criminal convictions. Instead, the EEOC's guidance suggests that employers should examine individual applicants on a case-by-case basis. As such, employers should request and utilize only information concerning applicants that is relevant to the job at issue and should consider the specific circumstances of each applicant. The EEOC states that to avoid violating Title VII of the Civil Rights Act of 1964 and current EEOC guidelines, employers should not rely on non-pending arrest information and that employers should consider the following before disqualifying an applicant who has one or more criminal convictions:

  1. the nature and gravity of the offense or offenses;
  2. the time that has passed since the conviction; and
  3. the nature of the job held or sought.

Additionally, employers should be mindful of the patch-work of state laws that also place various limitations on employers' ability to seek and to utilize certain types of criminal history information for employment purposes.

Similar to its concerns over employers using criminal history information in pre-employment background checks, the EEOC also takes a skeptical view of employers relying on applicants' credit history information. According to the agency, employers generally should avoid utilizing credit history as a means to screen applicants, given the potential disparate impact on minorities and females. The EEOC's concerns over use of credit histories appear to have increased over the past several years, in part, due to the economic downturn marked by high unemployment.

The EEOC's guidance in this regard provides for certain exceptions, for example, where an applicant's credit information may be closely related to the qualifications for and the duties of a particular job, such as a position with significant financial responsibilities. Again, similar to the analysis of criminal conviction information, employers utilizing credit histories to screen applicants should examine such information on a case-by-case basis and should be able to demonstrate that an applicant's credit history bears a relationship to the duties of the job. Additionally, it is important to note that several states now have laws expressly limiting the use of credit history information for employment purposes, and numerous bills have been introduced at both the federal and state level to limit employers from utilizing such information.

In light of the EEOC's stance on the use of criminal and credit histories in pre-employment background checks, Employers should take steps to ensure that their policies and procedures are in compliance with EEOC guidelines and other applicable federal and state laws. Dow Lohnes Labor and Employment attorneys have particular expertise in this regard and are available to assist with giving your organization's background check program a thorough check-up.