By John R. Emshwiller and Gary Fields
Eddie Sorrells is evaluating job applicants he knows he can't
hire.
The chief operating officer of DSI Security Services, a provider
of security guards, is checking out potential employees with felony
or certain misdemeanor convictions even though they wouldn't get
licensed in many of the 23 states where the firm operates.
Driving the company in that direction are government officials
in Washington and elsewhere who want to give people with rap sheets
a better shot at a job. Mr. Sorrells figures the reviews take up
hundreds of hours of staff time a year.
"It defies common sense," said Mr. Sorrells, who is general
counsel as well as COO of the Dothan, Ala., family-owned
company.
Three decades of tougher laws and policing have left nearly one
in three adult Americans with a criminal record, according to data
kept by the Federal Bureau of Investigation. That arrest wave is
washing up on the desks of America's employers.
Companies seeking new employees are forced to navigate a
patchwork of state and federal laws that either encourage or deter
hiring people with criminal pasts and doing the checks that reveal
them.SHY Employers are having to make judgments about who is
rehabilitated and who isn't. And whichever decision they make, they
face increasing possibilities for ending up in court.
Employers are in this position because there are nearly 80
million Americans with criminal records, including arrests that
didn't lead to a conviction, at a time when the Internet and
computerized databases make such information easier than ever to
obtain. Ignoring the records can leave a company vulnerable to
making bad hiring decisions and to lawsuits. But using them can
raise the ire of government officials and lead to charges of
discrimination.
Scott Fallavollita, the owner of United Tool & Machine Corp.
in Wilmington, Mass., said his first priority is keeping his
25-employee workplace safe. At the same time, he has hired
individuals with criminal records who were good workers. "I think
most people can see both sides and really want to do the right
thing," he said.
The number of companies running criminal background checks has
increased steeply in recent decades, said Michael Stoll, a
professor at the University of California, Los Angeles, who has
studied the topic. In the early 1990s, he said, fewer than 50% of
employers used background checks.
But 87% of employers were doing them on some or all job
applicants in 2012, a survey that year by the Society for Human
Resource Management showed. The figure was 92% in 2010, according
to the professional group.
Michael Aitken, its vice president of government affairs, said
the recent decline could stem from the complex legal landscape.
"Some employers might say it isn't worth walking into that
minefield," he said, even though "a bad hire can have consequences
for the company, its employees and its customers if that person
commits another crime."
Much of the nervousness traces to a 2012 document from the U.S.
Equal Employment Opportunity Commission. It recommended that
employers not ask about criminal records on initial application
forms. Before rejecting someone because of a criminal record, it
said, the employer should examine such things as when a conviction
occurred, whether the crime was related to the job in question and
what rehabilitation efforts the individual had made.
Though not a law, the document, called an enforcement guidance,
has teeth. It is the EEOC's position on what the 1964 Civil Rights
Act's employment-discrimination section, Title VII, requires of
employers.
It revises guidance from the 1980s. An update was needed, said
EEOC Chairwoman Jenny Yang, because "more Americans have criminal
records than they did [and] the Internet makes access to criminal
records more available."
In addition, 13 states and nearly 70 local jurisdictions have
passed laws restricting employer requests for criminal records
early in the hiring process, according to the National Employment
Law Project, a nonprofit research and advocacy group. Some of these
"ban-the-box" laws--referring to a check-off box on forms--don't
allow asking until a conditional job offer has been made.
The restrictions help those with rap sheets at least get a foot
in the door. Yet companies remain within their rights to check
criminal records at some point. The EEOC says there are instances
where a criminal record is a valid reason to turn down a job
applicant.
Washington, D.C., has a ban-the-box law. "You have people right
now to the tune of 8,000 residents per year coming home to the
District of Columbia from incarceration," said Councilman Kenyan
McDuffie, a Democrat. If they can't find jobs, he said, crime rates
go up, along with social-service and law-enforcement costs.
Race is a factor. Some minority groups, particularly black
males, have higher arrest and conviction rates than whites, putting
companies at risk of getting crosswise with the federal
government's antidiscrimination rules.
Under federal law, a decision that appears race-neutral, such as
asking about criminal records in hiring, can run into legal
problems if its effect is to disproportionately harm a particular
racial or ethnic group.
A 2009 study of 250 entry-level job openings in New York City
found an applicant's likelihood of getting a callback or job offer
fell by nearly 50% with a criminal record. Black applicants with
records fared far worse than similarly situated white applicants in
the study, done by researchers at Princeton and Harvard
universities.
Critics of delaying a criminal-record question say this can just
postpone the inevitable. "If it is a disqualifying offense, you've
just wasted both the candidate's and the employer's time," said
Nick Fishman, executive vice president of EmployeeScreenIQ, a
background-screening firm in Cleveland.
Grocery-store chain Aldi Inc., which operates in 32 states with
varying laws, dropped the question from applications, said Thomas
Behtz, a vice president. The Batavia, Ill., firm now asks about
criminal history only after making a conditional job offer, then
gives the applicant a questionnaire tailored to what can be asked
in the state at issue.
"I wouldn't say we feel handcuffed. But things are very, very
defined," Mr. Behtz said.
DSI, the security-guard firm whose Mr. Sorrells is evaluating
some applicants he can't hire, uses a criminal-background question
on application forms in states where this is permitted and not
elsewhere.
The firm doesn't automatically exclude applicants who admit to
being felons, instead proceeding to look at whether they meet other
hiring criteria, such as willingness to work the hours and
locations available. If so, it does an individualized assessment of
the criminal record.
Only then, Mr. Sorrells said, does the company reject the
applicant. A felon couldn't get licensed as a security guard in
most states where DSI operates, Mr. Sorrells said. Even where they
could, the company--though it has hired people with minor
misdemeanors--won't employ felons.
The reason is "liability concerns and what we believe is our
obligation to put the most qualified and well-suited officer at the
client's property," he said.
"Would I say that anyone with a felony record doesn't deserve a
job? Of course not," said Mr. Sorrells. "Just not a job in the
security business."
In its policing efforts, the EEOC has launched 100
investigations and a series of enforcement cases. It has reached
settlements in the past year with six companies over alleged misuse
of criminal history, the agency said in a report.
The EEOC settled with a PepsiCo Inc. unit in 2012 over allegedly
discriminatory treatment of black applicants with criminal
histories. Pepsi Beverages agreed to pay $3.1 million and possibly
offer positions to some applicants. In a written statement, Pepsi
said there wasn't any finding of intentional discrimination, and it
has worked with the EEOC to revise its hiring policy.
Retailer Dollar General Corp. and a U.S. unit of BMW AG are
currently being sued by the EEOC. Both denied wrongdoing.
G4S Secure Solutions (U.S.A.) Inc., a Jupiter, Fla., supplier of
security services, said it spent several hundred thousand dollars
responding to information requests from the agency during a nearly
three-year probe stemming from a complaint filed by a black
applicant rejected for a security-guard job. G4S said he was turned
down because of two theft convictions.
Once the EEOC starts looking into a company, "the burden is
almost unending on the employer until it meets whatever
expectation" for information the commission has, said Geoff Gerks,
senior vice president at G4S. The probe ended with no charges by
the EEOC, and G4S reached settlements with two individuals, he
said.
The EEOC said it doesn't confirm or deny the existence of
particular investigations or comment on pending litigation.
A judge last year dismissed an EEOC suit accusing a Dallas
events-marketing firm, Freeman Co., of a pattern of discrimination
based partly on its use of criminal-background information. Judge
Roger W. Titus, in dismissing the suit in federal court in
Greenbelt, Md., said the agency was asking companies to ignore
"criminal history and credit background, thus exposing themselves
to potential liability for criminal and fraudulent acts committed
by employees, on the one hand, or incurring the wrath of the
EEOC."
The EEOC has appealed. Freeman declined to comment.
While the federal government and some states have been moving to
help people with criminal records catch a break, others have
challenged the EEOC's campaign or have toughened background-check
requirements.
Texas sued the EEOC in federal court in Lubbock seeking to set
aside the 2012 enforcement guidance, which the state's complaint
called the "felon-hiring rule." The court said Texas didn't have
standing to challenge the rule, a decision the state is
appealing.
Iowa recently expanded a background-check requirement for
home-based child-care providers to include checks against the FBI's
criminal-records system, not just Iowa criminal records.
Ohio in 2007 passed a law barring people convicted of certain
crimes from working in public schools. The Cincinnati system
discharged 10 employees, nine of them black. Two of the nine filed
a suit in Cincinnati federal court, which is still pending,
alleging racial discrimination.
One plaintiff, Eartha Britton, 60 years old, was an
instructional assistant and 18-year veteran. Her crime: a 1983
conviction for being a go-between in the sale of $5 worth of
marijuana, a conviction that was later expunged, the suit said.
Through her attorney, she declined to be interviewed.
The Cincinnati school district said in a court filing that
public and private employers shouldn't be in the position of
second-guessing state law.
Even businesses that don't hire can get entangled in the issue.
Care.com Inc. is an online service that helps customers find
caregivers. Though the caregivers aren't its employees, the
Waltham, Mass., firm faces a suit over the background of one.
Clients Nathan and Reggan Koopmeiners say in the civil suit they
paid the firm for its highest level of background check, yet it
didn't tell them that a woman they hired had a "history of alcohol
abuse and violence." Under the influence of alcohol, she
negligently struck or slammed the head of their infant daughter,
killing her, said the suit, filed in Wisconsin state court in July
and later transferred to Milwaukee federal court. The woman faces a
murder charge, to which she has pleaded not guilty, said her
attorney, who said she didn't intend to harm the child.
Care.com said it screens caregivers based on information they
provide, including searching a criminal database, but this is only
a preliminary check and it offers three higher levels of checks at
different prices. In a court filing, it said the Koopmeiners hadn't
purchased any of those, and it denied wrongdoing.
The varying impulses--to give job seekers a fair shot, to keep
workplaces safe and to keep companies out of legal jeopardy--have
left Paul O'Brien, president of engineering firm GHT Ltd. in
Arlington, Va., struggling to chart a course.
He once hired a mechanical engineer with convictions for
burglaries, figuring he had turned his life around, and it worked
out fine. At the same time, some of GHT's federal contracts require
criminal-background checks of employees, Mr. O'Brien said. He is
watching the growth of restrictions on such record checks.
"You gotta know what you're getting into," he said. Otherwise,
"you bring somebody in and after he embezzles from you, then you
find out he embezzled from his last boss, too?"
GHT's job application still has a criminal-history question. Mr.
O'Brien is thinking of dropping it. "I don't want to get on the
wrong side of the government," he said.
Write to John R. Emshwiller at john.emshwiller@wsj.com and Gary
Fields at gary.fields@wsj.com
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