On November 7, the U.S. Senate passed Senate Bill 815, also known as the Employment Non-Discrimination Act (ENDA), to federally protect individuals from discrimination in the workplace based on their sexual orientation and gender identity. The bill’s passage comes a mere four months after the Supreme Court’s landmark decision in United States v. Windsor, which held that same sex couples who are legally married must be treated the same as married opposite sex couples under federal law. We reported on the potential impacts of Windsor here.
The bill bars employers from basing a personnel decision or treating an employee differently because of the employee’s sexual orientation or gender identity. ENDA will apply to most employers with 15 or more employees and labor organizations. The protections in the bill resemble current federal laws prohibiting workplace discrimination, such as Title VII of the Civil Rights Act of 1964 and the Americans with Disabilities Act (ADA). The Equal Employment Opportunity Commission, the federal agency that investigates and enforces Title VII and the ADA, would enforce ENDA if it becomes law.
Given the politicized nature of the bill, Senate negotiations required navigation of various constituent and party concerns. Among other things, the amended bill now provides exemptions for religious institutions. ENDA barely received the 60 votes (61-30) required to reach the full Senate, and passed by a close 64-32 vote. The bill faces an even more difficult uphill battle in the House of Representative as Speaker John Boehner has publicly opposed passage of ENDA. At this moment, the bill has not been scheduled in the House for debate.
Despite the legislative hurdles facing ENDA, the Senate’s decision to open debate and pass the bill reflects growing public support for increased legal protections for the rights of lesbian, gay, bisexual, and transgendered individuals. Nearly half of all states – including Illinois – have already passed employment laws prohibiting sexual orientation or gender identity-based discrimination.
Article provided courtesy of the Worklaw® Network firm Franczek Radelet (www.franczek.com).
The Obama administration is getting pushed back in the courts. This time in the case of EEOC v. Freeman. The overly aggressive political stances of the EEOC and NLRB are taking a toll on employer sanity and the courts are beginning to call the administration on its non-sense. The judge in this case responded to the political agenda with a legal one. Basically that there are no facts to support the position that these background checks are not done for legitimate reasons, but for discriminatory ones. Even where they may be a disparate impact in result. I’ll be very curious to see where the case evolves from here. Someday we will have an administration that once again rewards those who act responsibly, without blame or justification. That day can’t come soon enough.
As stated by the Court:
“For many employers, conducting a criminal history or credit record background check on a potential employee is a rational and legitimate component of a reasonable hiring process. The reasons for conducting such checks are obvious. Employers have a clear incentive to avoid hiring employees who have a proven tendency to defraud or steal from their employers, engage in workplace violence, or who otherwise appear to be untrustworthy and unreliable…. “While some specific uses of criminal and credit background checks may be discriminatory and violate the provision of Title VII, the EEOC bears the burden of supplying reliable expert testimony and statistical analysis that demonstrates disparate impact stemming from a specific employment practice before such a violation can be found. For the reasons explained below, the EEOC has failed to do so in this case.”
I suggest any business leader or HR executive read this very insightful opinion. One reason is that the process the company followed in managing this challenge was laudatory. In a sense the EEOC picked on the wrong company.
On September 30 EEO-1 Reports are due.
What companies are required to file the EEO-1 report?
A. All companies that meet the following criteria are required to file the EEO-1 report annually:
- Subject to Title VII of the Civil Rights Act of 1964, as amended, with 100 or more employees; or
- Subject to Title VII of the Civil Rights Act of 1964, as amended, with fewer than 100 employees if the company is owned by or corporately affiliated with another company and the entire enterprise employs a total of 100 or more employees; or
- Federal government prime contractors or first-tier subcontractors subject to Executive Order 11246,as amended, with 50 or more employees and a prime contract or first-tier subcontract amounting to $50,000 or more.
Do I need to file if my company has fewer than 50 employees but does have a federal government contract worth $50,000 or more?
A. No, your company must meet both requirements of 50 employees and the government contract worth $50,000 or more.
To learn more go to http://www.eeoc.gov/employers/eeo1survey/faq.cfm
In a recent Webinar I did with DFEH head Phyllis Cheng she shared this graph of claims filed in California in 2011. And it got me to thinking. It made me want to ask… just how bad is that?
There are roughly 16 million workers in California. In 2011 roughly 18,000 cases were filed with the DFEH (the new 2012 numbers will be closer to 21,000 but as of this writing were not published yet). Let’s assume that is one half the claims universe since claims like overtime, wrongful termination and the like don’t need to involve the DFEH. So… 16,000,000 divided by 42,000 gets you one claim per year, of some kind, per 380 employees. Many of the DFEH and other claims are dismissed as without merit. The really good cases get pulled out of the DFEH system and dragged into court. Employees win more than half the cases that go to trial with the average jury verdict hovering around $250,000, the average settlement around $75,000. And that doesn’t include attorney’s fees. Of course you can–and should–insure against these claims so that your exposure does not exceed your deductible limit of, say, $25,000. The cost of that insurance is approximately $150 per year per employee, which comes out to a $57,000 annual premium. Keeping on one poor manager you are afraid to fire due to a potential lawsuit will more than eat up that premium cost.
Note: The EEOC claims some 100,000 discrimination claims were filed with it in 2012.
While getting the stats for work comp claims was more difficult, what I could find indicated there roughly 780,000 workers’ compensation claims filed each year in California. Most claims (around two-thirds) are for medical care only, with no cash indemnity payments. Approximately 20 percent of claims are for temporary disabilities. Permanent partial disability claims account for about 14 percent of total claims – 10 percent are minor disabilities and four percent are major disabilities. Death benefits and permanent total disability benefits each account for about one-half of one percent of total workers’ compensation claims. According to the rating bureau, the average lost work claim cost roughly $68,000 (and there were roughly 260,000 of them.) Of course these claims are always insured and in 2010, employers paid an average of $2.37 per $100 of payroll for policies.
Bottom line with risk management is to analyze, mitigate, and insure against it where possible.
The U.S. Equal Employment Opportunity Commission (EEOC) has been busy updating its disability related regulations and materials. All employers should review the info here.
The EEOC has also released four revised publications on protection against disability discrimination in the workplace. The publications describe how the Americans with Disabilities Act (ADA) applies to job applicants and employees with cancer, diabetes, intellectual disabilities. You can find these documents on the EEOC website under “Disability Discrimination, The Question and Answer Series.”
Many people with common mental health conditions have a right to a reasonable accommodation at work under the Americans with Disabilities Act (ADA). When requesting accommodations, employees may sometimes need supporting documentation from their mental health providers. An EEOC fact sheet briefly explains the law on reasonable accommodation and the mental health provider’s role in the process. Click here to read more.
On April 25, 2012, the EEOC issued updated Enforcement Guidance regarding an employer’s use of arrest and conviction records in making employment decisions. The agency also issued a Question and Answer (Q&A) document that helps explain the Guidance.
According to the EEOC, a policy or practice that excludes everyone with a criminal record from employment will not be job related and consistent with business necessity and therefore will violate Title VII, unless it is required by federal law. The Enforcement Guidance explains how the EEOC analyzes the “job related and consistent with business necessity” standard for adverse employment hiring decisions based on criminal records, and provides hypothetical examples interpreting the standard.
Arrests and convictions are treated differently for purposes of Title VII, since the fact of an arrest does not establish that criminal conduct has occurred. The EEOC acknowledges that an arrest may in some circumstances trigger an inquiry into whether the conduct underlying the arrest justifies an adverse employment action. The Guidance notes, “[a]lthough an arrest standing alone may not be used to deny an employment opportunity, an employer may make an employment decision based on the conduct underlying the arrest if the conduct makes the individual unfit for the position in question. The conduct, not the arrest, is relevant for employment purposes.”
In examining whether an employer’s policy of screening individuals based on criminal convictions violates Title VII, the EEOC will look to see whether the employer’s policy provides an opportunity for an individualized assessment for those people identified by the screen in order to determine if the policy as applied is job related and consistent with business necessity. Under the new enforcement rules, the following should be considered by an employer when screening based on criminal convictions:
• The Nature and Gravity of the Offense or Conduct. The Guidance notes: “Careful consideration of the nature and gravity of the offense or conduct is the first step in determining whether a specific crime may be relevant to concerns about risks in a particular position. The nature of the offense or conduct may be assessed with reference to the harm caused by the crime (e.g., theft causes property loss). … With respect to the gravity of the crime, offenses identified as misdemeanors may be less severe than those identified as felonies.”
• The Time that Has Passed Since the Offense, Conduct and/or Completion of the Sentence. The Guidance points out that the amount of time that had passed since the applicant’s criminal conduct occurred is probative of the risk he poses in the position in question. For example, the Guidance notes that the risk of recidivism may decline over a certain period of time.
• The Nature of the Job Held or Sought. Linking the criminal conduct to the essential functions of the position in question may assist an employer in demonstrating that its policy or practice is job related and consistent with business necessity because it “bear[s] a demonstrable relationship to successful performance of the jobs for which it was used.”
The Guidance also lists examples of employer best practices for considering criminal records in connection with employment decisions. Among other examples, the Guidance advises employers to (1) develop a narrowly tailored written policy and procedure for screening applicants and employees for criminal conduct, (2) identify essential job requirements and the actual circumstances under which the jobs are performed, (3) determine the specific offenses that may demonstrate unfitness for performing such jobs, (4) determine the duration of exclusions for criminal conduct based on all available evidence, and (5) record the justification for the policy and procedures.
Article courtesy of Worklaw® Network firm Shawe Rosenthal (www.shawe.com).
The Equal Employment Opportunity Commission recently issued an opinion concluding that under Title VII, employees may bring discrimination claims based on their transgendered status or gender identity.
Mia Macy was a male police detective in Phoenix, Arizona. In 2010, Macy decided to relocate to San Francisco and pursue a position with the Bureau of Alcohol, Tobacco, Firearms, and Explosives. After the interview process, a local director for the Bureau informed Macy that she would be able to fill the position provided that she passed a background check. While her background check was pending, Macy informed the third-party contractor responsible for filling the position that she was in the process of transitioning from male to female. The contractor relayed this information to the Bureau. Five days later, the Bureau notified Macy that the position had been cut due to budget restrictions. An EEO counselor at the Bureau, however, told Macy that another applicant had been hired for the position because that individual was farther along in the background investigation process. Macy filed a discrimination charge against the Bureau, alleging sex discrimination, and discrimination on the basis of gender identity (as a transgender woman) and sex stereotyping. When only her sex discrimination claim was accepted, however, Macy appealed.
The Commission reversed the decision, concluding that discrimination claims based on transgender status or gender identity are covered under Title VII. The Commission based its conclusion principally upon the United States Supreme Court’s decision in Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) and subsequent decisions by federal courts. In Price Waterhouse, the Supreme Court held that discrimination on the basis of gender stereotype (e.g., a woman denied partnership in a company because she was too “macho” and not “feminine” enough) is sex-based discrimination prohibited under Title VII. Several United States Circuit Courts of Appeals have subsequently held that under this holding, Title VII bars “not just discrimination because of biological sex, but also gender stereotyping—failing to act and appear according to expectations defined by gender.” Following this approach, the Commission reasoned that when an employer discriminates against someone because the person is transgender, the disparate treatment is “related to the sex of the victim.” According to the Commission, this includes a person allegedly discriminated against for expressing his or her gender in a non-stereotypical fashion, and a person allegedly discriminated against because an employer is uncomfortable with or dislikes the fact that he or she has or is transitioning from one gender to another.
Going forward, employers should assume that the Commission’s opinion is legally correct. While the Supreme Court has not specifically addressed whether transgender or gender identity discrimination claims are covered under Title VII, many lower courts have held that this is a protected class. Therefore, given the current trend in federal courts to recognize the validity of such claims, the Commission’s opinion will certainly bolster an employee’s ability to bring gender identity and transgender discrimination claims under Title VII.
In 2009 the US Supreme Court pretty much cut out “mixed-motive” cases in the age arena. Meaning you now have to show that “but for” age discrimination you would have suffered that loss of job, etc. If there is any legit reason for your termination then you lose. In response to this ruling the legislatures are busy trying to work their way around it and the EEOC has updated its regulations as follows (underlining mine):
§ 1625.7 Differentiations based on reasonable factors other than age (RFOA).
(b) When an employment practice uses age as a limiting criterion, the defense that the practice is justified by a reasonable factor other than age is unavailable.
(c) Any employment practice that adversely affects individuals within the protected age group on the basis of older age is discriminatory unless the practice is justified by a “reasonable factor other than age.” An individual challenging the allegedly unlawful practice is responsible for isolating and identifying the specific employment practice that allegedly causes any observed statistical disparities.
(d) Whenever the “reasonable factors other than age” defense is raised, the employer bears the burdens of production and persuasion to demonstrate the defense. The “reasonable factors other than age” provision is not available as a defense to a claim of disparate treatment. (Meaning individual harassment, discrimination, etc.)
(e) (1) A reasonable factor other than age is a non-age factor that is objectively reasonable when viewed from the position of a prudent employer mindful of its responsibilities under the ADEA under like circumstances. Whether a differentiation is based on reasonable factors other than age must be decided on the basis of all the particular facts and circumstances surrounding each individual situation. To establish the RFOA defense, an employer must show that the employment practice was both reasonably designed to further or achieve a legitimate business purpose and administered in a way that reasonably achieves that purpose in light of the particular facts and circumstances that were known, or should have been known, to the employer.
(2) Considerations that are relevant to whether a practice is based on a reasonable factor other than age include, but are not limited to:
(i) The extent to which the factor is related to the employer’s stated business purpose;
(ii) The extent to which the employer defined the factor accurately and applied the factor fairly and accurately, including the extent to which managers and supervisors were given guidance or training about how to apply the factor and avoid discrimination;
(iii) The extent to which the employer limited supervisors’ discretion to assess employees subjectively, particularly where the criteria that the supervisors were asked to evaluate are known to be subject to negative age-based stereotypes;
(iv) The extent to which the employer assessed the adverse impact of its employment practice on older workers; and
(v) The degree of the harm to individuals within the protected age group, in terms of both the extent of injury and the numbers of persons adversely affected, and the extent to which the employer took steps to reduce the harm, in light of the burden of undertaking such steps.
(3) No specific consideration or combination of considerations need be present for a differentiation to be based on reasonable factors other than age. Nor does the presence of one of these considerations automatically establish the defense.
Word to the wise: Make sure you can fit any promotion, termination, or layoff type decision into the guidelines set forth above.
Today, the Equal Employment Opportunity Commission (EEOC) released the first updates in nearly 25 years to its guidelines on when and how employers may inquire into an applicant’s arrest and conviction history. According to the EEOC, the new Guidance clarifies and updates the EEOC’s longstanding policy concerning the use of arrest and conviction records in employment, which will assist job seekers, employees, employers, and many other agency stakeholders. Our preliminary analysis confirms that the Guidelines do not appear to represent a fundamental shift in the EEOC’s positions, but rather summarize pre-existing guidelines and principles based on applicable case law and available demographic research.
The EEOC’s Updated Guidance
No federal law explicitly prohibits employers from so inquiring into an applicant’s past criminal history, however, court decisions and EEOC guidelines have previously recognized that, in some cases, disqualifying an applicant because of an arrest or conviction record could violate the Civil Rights Act of 1964, as amended (Title VII), which prohibits employment discrimination based upon race, color, religion, sex and national origin. The updated Guidance notes that the use of criminal history may violate Title VII in one of two ways. First, Title VII may be violated when an employer treats criminal history information differently for different applicants or employees, based on their race or national origin (i.e., disparate treatment liability). Second, a violation may occur where an employer’s facially neutral policy of excluding applicants from employment based on criminal history disproportionately impacts African American and/or Hispanic applicants and is not job related and consistent with business necessity (i.e., disparate impact liability).
The Guidance distinguishes between the use of arrest and conviction records. According to the EEOC, an employer’s reliance on an arrest record in and of itself is not job related and consistent with business necessity because the fact of an arrest does not establish that criminal conduct has occurred. However, an employer may make an employment decision based on the conduct underlying an arrest if that conduct makes the individual unfit for the position in question. The EEOC further recognizes that a conviction record in most cases will usually serve as sufficient evidence that an individual engaged in particular conduct, but notes that in certain circumstances there may be reasons why an employer should not rely on a conviction record alone.
The Guidance cites to nationwide statistical data showing that African American and Hispanic individuals are arrested and convicted at a rate 2 to 3 times their proportion of the general population and states that this nationwide data provides a basis for EEOC to investigate an employer’s use of criminal records. During an investigation, the EEOC will look to whether the particular employer’s use of criminal history has a statistically significant disparate impact on any protected group.
Once a disproportionate impact is shown, the employer may only avoid liability if it can show that the reliance on criminal history is job related and consistent with business necessity. The revised Guidance sets out two circumstances in which the EEOC believes employers will consistently meet this defense:
- The employer validates the criminal conduct exclusion for the position in question under the EEOC Uniform Guidelines on Employee Selection Procedures; or
- The employer develops a targeted screen that considers at least the nature of the crime, the time elapsed, and the nature of the job. The employer’s policy must also provide an opportunity for an individualized assessment of those people identified by the screen to determine if the policy as applied is job related and consistent with business necessity.
As to the first defense, the Guidance recognizes that in most cases this will not be a viable option because of the lack of currently available studies that could provide a framework for formal validation. For the second defense, the Guidance notes that while an “individualized assessment” is not required under Title VII under all circumstances, the lack of an individualized assessment is more likely to result in a violation.
Best Practices Identified by the EEOC
The Guidance provides several examples of best practices for employers who consider criminal record information when making employment decisions (beyond a recommendation for more training). In general, the EEOC advises employers to eliminate policies or practices that “exclude people from employment based on any criminal record” and to replace them with “narrowly tailored” policies that provide for targeted, individualized screening of specific offenses based on a job’s essential requirements and actual duties. The Commission also recommends that employers keep a record of the justifications and research that supports those policies. Finally, the EEOC suggests that when asking questions about criminal records employers should limit their inquiries to records for which an exclusion would be job related for the position in question and consistent with business necessity.
Background checks remain fraught with potential pitfalls for employers. However, employers should not let those hazards stop them from performing proper due diligence on potential employees, provided that they do so in a targeted and individualized manner that relies only on criminal history in a manner that is consistent with the EEOC Guidance. We will be providing clients with more detailed guidance and training opportunities in the coming weeks on this important update of the EEOC’s views on the use of criminal history records in hiring.
The EEOC is proud of its lawsuits. I used to be proud of mine too…until I realized thy cause more damage than good…even where there was bad conduct. According to the EEOC’s press release page these are the claims from just one week:
As you can see from the titles, disability and pregnancy leave have been major targets. Employers must do two things to better manage these claims: First, take disability requests and harassment complaints seriously. If you don’t know what to do, then get help. Secondly, get Employment Practices Liability Insurance. See the checklist on HR That Works. I bet every one of the companies sued that didn’t purchase it wishes it had. Also understand this – these settlements and verdicts are LESS than they would be if brought by private attorneys in state courts.