EEOC’s Final Rule for Issuing Guidance for Employers

Good news for employers. While EEOC guidance is often useful for employers, the EEOC itself has been challenged for improperly legislating through guidance, without public comment, as well as treating their guidance as binding.

In an effort to improve public awareness and understanding of the legal effects of agency positions, the Equal Employment Opportunity Commission (EEOC) recently issued a final rule establishing procedural regulations for the issuance of guidance. The rule clarifies several issues, including:

  • Making guidance documents readily available to the public;
  • Ensuring guidance is treated as non-binding and not overstepping of legal authority;
  • Requiring a notice and public comment period for significant guidance; and
  • Establishing a public petition process for the issuance, amendment, or repeal of guidance

Notably, with regard to not overstepping legal authority, the rule notes that guidance must include, “A clear and prominent statement of the following: ‘The contents of this document do not have the force and effect of law and are not meant to bind the public in any way. This document is intended only to provide clarity to the public regarding existing requirements under the law or Commission policies.’”

With this rule, which became effective December 2, 2020, the EEOC intends to improve guidance issuance and knowledge, critical components of its outreach efforts.

The EEOC has issued and updated guidance related to the COVID-19 pandemic to balance workplace safety and compliance with the American with Disabilities Act. In addition, they had issued guidance on the use of criminal records in employment decisions under Title VII. We had previously written about the EEOC searching for cases to support their policies, and often failing to do so. Employers won in cases such as Freeman vs. EEOC and EEOC vs. Kaplan. Yet, despite losing several high-profile cases, the EEOC continued aggressive enforcement actions. In the Freeman case, the court called the EEOC’s position an “egregious example of scientific dishonesty.”

Now, with the current procedural guidance, the EEOC will have some new, welcomed guidelines to follow itself.

At Hire Image, we work with employers to understand the EEOC’s guidance and impacts as it relates to occupational health testing and background checks. Please contact us if you have any questions about the laws and rules governing background checks and drug screening.


The EEOC is Cracking Down on Employers with Pre-Employment Physical Ability Tests

The EEOC’s Strategic Enforcement Plan (SEP) focuses, in part, on eliminating class-based recruitment and hiring practices that discriminate against racial, ethnic and religious groups, older workers, women, and people with disabilities.

Since issuing the SEP, the agency has filed lawsuits against employers to ensure that there is a level playing field for women and individuals with disabilities, among other classes.  Recent cases Hire Image to demonstrate this with regard to pre-employment Physical Ability Tests (PATs) for job applicants.  The EEOC is pursuing employers where the PAT being used may be disparately impacting women – and, the EEOC is winning.  In the most recent case, $3.2 million was awarded to a class of female applicants, who have disproportionately turned away from a job because of the results of the PAT.

Given this impact, and especially in light of the size of the recent judgment, it is crucial for employers to understand the issues surrounding PATs.  The EEOC is searching for any disparate impact a PAT could have.  If one is found, the employer has the burden of showing (1) the use of the PAT is job-related and (2) the PAT is consistent with business necessity.  In order to show business necessity, the PAT must be predictive of the individual’s ability to perform essential job tasks.  The employer must also show that no alternative practice could achieve his or her objectives with less adverse impact.

The EEOC lists Best Practices for Employment Testing.  Those include:

  • Employers should administer tests and other selection procedures without regard to race, color, national origin, sex, religion, age (40 or older), or disability.
  • Employers should ensure that employment tests and other selection procedures are properly validated for the positions and purposes for which they are used. The test or selection procedure must be job-related and its results appropriate for the employer’s purpose. While a test vendor’s documentation supporting the validity of a test may be helpful, the employer is still responsible for ensuring that its tests are valid under UGESP.
  • If a selection procedure screens out a protected group, the employer should determine whether there is an equally effective alternative selection procedure that has a less adverse impact and, if so, adopt the alternative procedure. For example, if the selection procedure is a test, the employer should determine whether another test would predict job performance but not disproportionately exclude the protected group.
  • To ensure that a test or selection procedure remains predictive of success in a job, employers should keep abreast of changes in job requirements and should update the test specifications or selection procedures accordingly.
  • Employers should ensure that tests and selection procedures are not adopted casually by managers who know little about these processes. A test or selection procedure can be an effective management tool, but no test or selection procedure should be implemented without an understanding of its effectiveness and limitations for the organization, its appropriateness for a specific job, and whether it can be appropriately administered and scored.

The following are some recommendations specifically for employers conducting PATs:

  • Ensure the PAT is properly validated (actually testing physical abilities that workers need on the job)
    • Use a professional job analyst/consultant (appropriate employee safety experts)
      • Include measurements of frequency, weight, durations, tools, and distances involved in performing physical tasks
    • Have the analyst document the verifiable physical tasks necessary for the specific job (not a class of jobs)
  • Design/Redesign a PAT to simulate job tasks or test the minimum level of fitness required to safely and effectively perform the job.
  • Revalidate PATs to make sure tests are still measuring only necessary job tasks.

While PATs are useful tools used by Hire Image to improve worker safety, they can result in disparate treatment leading to claims of discrimination.  Employers should pay close attention to their practices, consider the above recommendations, and be aware of the EEOC’s continued pursuit of employers who are not doing enough to ensure that women and people with disabilities have a fair chance to obtain a position that may involve a pre-employment physical ability test.


BMW Signs Consent Decree in Settlement of EEOC Lawsuit

To settle a discrimination lawsuit brought against them by the EEOC in 2013, BMW Manufacturing Co. will pay $1.6 million to a group of 56 former employees and offer them their jobs back at a manufacturing plant located in South Carolina. In the decree the EEOC claims that under Title VII of the Civil Rights Act of 1964 BMW “discriminated against black logistics employees through its application of criminal background check guidelines that had a disparate impact which resulted in said employees being discharged”. The claimants in the suit were employed by UTi Integrated Logistics Inc. which contracted with a BMW manufacturing facility in Spartanburg, SC until BMW contracted with another company in July of 2008. Under BMW’s agreement with the new contractor, all UTi employees were required to reapply for their positions as well as have a criminal background check performed. BMW’s background check policy made no distinction between felony and misdemeanor convictions and explicitly stated it will exclude individuals from employment for convictions related to:

“Murder, Assault & Battery, Rape, Child Abuse, Spousal Abuse (Domestic Violence), Manufacturing of Drugs, Distribution of Drugs, [and] Weapons Violations.”

“any convictions of a violent nature are conditions for employment rejection,” and “there is no statute of limitations for any of the crimes.”

“theft, dishonesty, and moral turpitude.”

The criminal background checks resulted in 88 employees being denied employment with the new contractor.  80% or 70 of those denied employment were black.  The suit stated that each of the claimants was a qualified applicant who had worked in the facility for several years and cites an example of a female claimant who had worked in the BMW plant for 14 years, but was denied employment based on a misdemeanor simple assault conviction from 1990 that was punished with a $137 fine.

BMW has claimed no liability or wrongdoing, but, in addition to the monetary restitution and offer of reinstatement to those employees who were terminated, they are also required to alter their background screening and hiring process.  Some of the key requirements are as follows:

  • BMW agrees that they “shall not decline to hire any job applicant or otherwise disqualify any individual from employment in a logistics position because of criminal arrests or charges of any type if such arrests or charges did not result in a conviction”. It is permitted to postpone an offer of employment until final determination has been made on pending charges.
  • BMW must conduct an assessment of an individual’s criminal history before taking adverse action. This process includes but is not limited to providing a written notice to the applicant explicitly describing the criminal history which may be the basis for adverse action and offering the applicant an opportunity to discuss their history and fitness for the job.
  • BMW must provide 21 days between this pre-adverse notification and final adverse action if the decision is made not to hire after the assessment is complete.  This is a significant departure from standard practice given that most employers, following FCRA guidelines, extend a 5 day grace period between pre-adverse and adverse action.
  • BMW must appoint an official to review final decisions before disqualifying an applicant based upon the results of his/her criminal background results.

According to Montserrat Miller, partner at Arnall Golden Gregory, the settlement agreement is noteworthy because (a) the EEOC is mandating that BMW conduct an individualized assessment each time criminal history is considered, and (b) the 21-day time frame.  In her blog Miller states, the EEOC’s enforcement guidance on the use of criminal records does not mandate “individualized assessments”.  She also points out, “employers typically provide 5 business days between providing a job applicant with the pre-adverse action letter under the federal Fair Credit Reporting Act and the adverse action letter (assuming the employer is not going to hire the candidate).  Conceding the point that adverse action notices are different than an individualized assessment and any notice related to that, it is interesting to note the 3 week time period here and what that may mean for employers who may seek to terminate a job applicant due to their criminal history.”

Employers are encouraged to speak to their legal counsel to see how or if this settlement will impact their screening process.

Click the link to read the full text of the decree BMW Consent Decree 2015 09 08

Top 10 Background Screening Predictions for 2015

Criminals found in the workplace, sweeping changes in legislation regarding medical marijuana, high-profile cases of resume fraud, and increased number of class action lawsuits against businesses for non-compliance with employment laws — it’s no wonder so many employers realized the importance of professional background screening in 2014.  (more…)

Big Win for Employers- EEOC v. Kaplan Higher Education Corp

April 10, 2014

On April 9, 2014, a federal appeals court upheld the dismissal of the Equal Employment Opportunity Commission’s lawsuit against Kaplan Higher Education Corporation. The lawsuit between the EEOC and Kaplan has been lengthy and drawn out. In December 2010, the EEOC sued Kaplan in federal district court in Ohio, claiming that Kaplan’s use of pre-employment credit checks was in violation of Title VII, and had a disparate impact on protected class members. The EEOC alleged that Kaplan’s use of credit checks caused it to screen out more African-American applicants than white applicants. In November 2012, Kaplan and the EEOC both filed separate motions for judgment before trial. (more…)

U.S. Commission on Civil Rights Inundated by Comments on EEOC Guidance

May 22, 2013

The U.S. Commission on Civil Rights (USCCR) held a briefing in December 2012 to assess the impact of criminal background checks and the EEOC’s guidance on the consideration of arrest and conviction records in enforcement decisions under Title VII and its impact on the employment of black and Hispanic workers. Hire Image, along with the National Association of Professional Background Screeners (NAPBS) and many other like-minded organizations, signed a letter to the commission to provide insight into the defects of the Guidance – defects that discourage responsible use of criminal background checks. The letter was quite lengthy but highlighted the lack of transparency in issuing the guidance as well as the failure to weigh the important societal interests served by criminal background checks. The USCCR received so many letters that they have been unable to post them online.  We have reproduced the letter here.

Peter Kirsanow, a member of the US Commission on Civil Rights and a partner in the Labor and Employment Practice Group of Benesch wrote the following in a recent article in the National Review Online (January 2013): (more…)