Ripple Effects – Activity in Employment Screening

Ripple Effects – Activity in Employment Screening

By Jessica Cohen Taubman

water-rippleThe level of legislative activity, regulatory guidance, and litigation surrounding background checks for employment screening has never been higher. And, as onerous litigation and multi-million dollar settlements become increasingly common, the stakes have never been higher for employers as they seek to balance external requirements with their legitimate business needs. Three recent actions follow, along with ripple effects.


As we previously blogged, on April 27, 2015, the US Supreme Court agreed to grant “certiorari” (agreed to review) Spokeo, Inc. v. Robins, No. 13-1339 (U.S.). One of the questions expected to be addressed by the Court is whether actual damages must occur for a lawsuit to proceed or if failure to comply with legal requirements, in and of itself, constitutes damage.

Employers are increasingly finding themselves as defendants in class action litigation for allegedly failing to meet Fair Credit Reporting Act (FCRA) statutory requirements, thus making a decision on actual damages significant for them.  If the Supreme Court rules actual damages must occur, the “cookie cutter” FCRA class action cases would likely decrease significantly as it is much more difficult to demonstrate actual harm on a class basis.

On April 29, within days of the Court agreeing to review the Spokeo case, one of the first “ripples” appeared. Whole Foods Market, a major US employer and current defendant in an FCRA based class action, petitioned the Federal District Court in Florida to delay their case until the Supreme Court makes its ruling. Although the District Court denied, the request for delay is indicative of an employer community hoping for a favorable ruling from the Supreme Court. Time will tell.

Ban the Box

“Ban the box” refers to removing the criminal history question from the initial employment application. The ban the box movement continues to spread in two directions, one being the ever-increasing number of states and localities implementing ban the box. According to the National Employment Law Project (NELP), 16 states and more than 100 localities have passed ban the box laws.

As the number of ban the box locations grows, it becomes more and more difficult for employers to manage the varying requirements, including where and when they may ask the question. As a result, the second direction is the increasing number of employers who have opted to simply not ask about criminal history as part of the application process, regardless of whether their jurisdiction has a ban the box law on the books.

Koch Industries, an $11 billion company with more than 60,000 employees, is the latest major U.S. employer to ban the box from its employment application. Other major employers who have already implemented ban the box, also referred to as “fair chance policies”, include Home Depot, Walmart, Target, and Bed Bath and Beyond. This trend is expected to continue as compliance with an increasingly complex patchwork of rules and regulations becomes more problematic and as employers seek to provide a fair chance to all employment candidates.

EEOC Criminal Record Guidance

In April of 2012 the US Equal Employment Opportunity Commission (EEOC) issued updated guidance on the use of criminal records in employment decisions. The guidance does not have the force of law or regulation, but ripples continue.

The EEOC continues to pursue employers whose use of criminal records allegedly creates a disparate impact on minorities. In addition, many employers have voluntarily reviewed its use of criminal records in employment decisions and elected to change their practices.  Most recently, Apple announced they were changing a policy which had prohibited employment at their Cupertino, CA construction project of persons with felony convictions in the past seven years. Apple has not provided details on how prior criminal convictions will factor into employment decisions, but has rescinded their previous blanket disqualification policy.  (A San Jose Mercury news article provides more detail.)

EBI will continue to monitor all of this activity and keep readers informed so employers never feel like they are being hit by a tsunami.

Employment Background Investigations is a technology driven leader in domestic and global pre-employment background checks, drug testing, occupational health screening and I-9 compliance. We specialize in development, implementation and management of customized employment screening programs for large and multi-national clients. We are dedicated to information security.  EBI is the only NAPBS Accredited background screening company in the world to hold both an ISO 27001:2005 certification for information security and an ISO 9001:2008 certification for Quality Management.

All content provided by EBI is published for the convenience of its readers and should never be deemed as legal guidance or advice.  Always consult your legal counsel for specific advice on state laws and industry regulations.

About the Author

Jessica Cohen Taubman

Jessica Cohen Taubman

Jessica Cohen Taubman is the Compliance Manager at EBI. She holds a Juris Doctor from the Emory University School of Law and a Master of Science in Criminology from the University of Pennsylvania, and is an active member of the State Bar of Georgia. Her legal background and experience in various facets of the criminal justice system have helped shape her work in the background screening and drug testing industries.

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