Race, Employment, and Crime: The Shifting Landscape of Disparate Impact Discrimination Based on Criminal Convictions

• DOI: http://doi.org/10.1111/ablj.12028
• Author: Andrew Little,Lucas Loafman
• Date: 01 June 2014
• Published date: 01 June 2014

Race, Employment, and Crime:

The Shifting Landscape of Disparate

Impact Discrimination Based on

Criminal Convictions

Lucas Loafman* and Andrew Little**

INTRODUCTION

The disparate impact theory of discrimination under Title VII of the Civil

Rights Act of 19641is not new, yet it is taking on a different, more

antagonistic dimension. Since the early 1970s it has been a recognized

theory under which plaintiffs may seek redress for discriminatory prac-

tices.2In addition, by the mid-1970s the courts recognized that in some

instances an employer’s criminal conviction policy, which screens out

applicants or employees with criminal convictions, may have a disparate

impact on members of minority races and be unjustified by a lack of

*J.D., M.B.A., Department Chair—Management & Marketing and Assistant Professor,Texas

A&M University Central Texas.

**J.D., Assistant Professor of Business Law, Abilene Christian University.

1Pub. L. No. 88-352, Title VII, 78 Stat. 241, 253 (1964).

2Griggs v. Duke Power Co., 401 U.S. 424, 430 (1971) (“Under [Title VII], practices, proce-

dures, or tests neutral on their face, and even neutral in terms of intent, cannot be maintained

if they operate to ‘freeze’ the status quo of prior discriminatory employment practices.”). The

term “disparate impact” did not begin to be associated with this holding until the late 1970s.

See, e.g., Dickerson v.U.S. Steel Corp., 439 F. Supp. 55, 70 (E.D. Pa. 1977) (noting that neutral

practices illegally affecting blacks more than whites is known as the “disparate impact”

theory); Martha Chamallas, Evolving Conceptions of Equality Under Title VII: Disparate Impact

Theory and the Demise of the Bottom Line Principle, 31 UCLA L. REV. 305, 305 (1983) (referring

to cases in which an employer is charged with unintentional discrimination as disparate

impact cases); Glenn B. Manishin, Note, Section 1981: Discriminatory Purpose or Disproportionate

Impact?,80C

OLUM.L.REV. 137, 138 n.7 (1980) (noting the disproportionate impact test is also

referred to as disparate impact).

bs_bs_banner

American Business Law Journal

Volume 51, Issue 2, 251–314, Summer 2014

© 2014 The Authors

American Business Law Journal © 2014 Academy of Legal Studies in Business

251

business necessity, and therefore violate Title VII.3In this regard, the law

for at least the last three decades has been moderately stable. However, in

the past five years there has been a marked increase in district court cases

involving criminal conviction policies and disparate impact claims, and the

Equal Employment Opportunity Commission (EEOC or Commission) has

promulgated aggressive new Guidance that attempts to increase litigation

and enforcement in this context.4In fact, as recently as June 2013

the EEOC filed two new actions against BMW Manufacturing and

Dolgencorp, doing business as Dollar General, for alleged violations of

Title VII arising from the conviction screens of these large employers. The

result of the recent spate of lower-level cases and Commission action is an

uncertain and seemingly shifting landscape for employers. Several ques-

tions arise. How and when can employers screen out applicants based on

past convictions? Do the increased enforcement efforts—spearheaded by

the EEOC—impose costs on employers and society at large that outweigh

the supposed benefits? Has the EEOC disregarded the legal, commercial,

and ethical justifications for excluding from employment those with

certain convictions? What is the statistical support for the EEOC’s Guid-

ance related to disparate impact based on race? What is the role of the

business community in responding to societal problems? These questions,

among many others, are highlighted in this article in an attempt to

increase awareness and enlarge scholarly dialogue on this contentious and

murky issue.

At the outset, we emphasize that this article and the questions we

raise have a limited scope. Discrimination is a societal evil that the EEOC,

state and local authorities, the business community, nonprofit advocacy

groups, and individuals in their daily lives should all seek to eliminate. In

this vein, we do not address disparate treatment—in other words,

intentional—discrimination, nor do we challenge the underpinnings of

disparate impact theory or the suggestion that what appear to be neutral

workplace rules can have the effect of perpetuating discrimination. Along

these lines, and to take one clear example, employer use of criminal arrest

3See infra Part II.A.

4See, e.g., Class Action Complaint, Arroyo v. Accenture, LLP, No. 10-CV-3013 (S.D.N.Y. Apr.

8, 2010); see also EEOC, ENFORCEMENT GUIDANCE No. 915.002, CONSIDERATION OF ARREST AND

CONVICTION RECORDS IN EMPLOYMENT DECISIONS UNDER TITLE VII OF THE CIVIL RIGHTS ACT

OF 1964 (2012) [hereinafter EEOC 2012 ENFORCEMENT GUIDANCE], available at http://

www.eeoc.gov/laws/guidance/upload/arrest_conviction.pdf.

252 Vol. 51 / American Business Law Journal

records is and should remain prohibited.5Finally, we are not focusing on

possible disparate impact arguments based on the Americans with Disabili-

ties Act (ADA) and conviction screens, though we recognize the link

between rehabilitated (and therefore protected) drug addiction and crimi-

nal convictions.6The position we stake out, and on which we encourage

dialogue and debate, is the more legally and ethically difficult conundrum

of how employers may use criminal conviction records without perpetu-

ating invidious discrimination in the workplace.7

Though much has already been written on this subject, legal schol-

arship tends to suggest, not surprisingly, a greater need for more or better

law. Professors O’Brien and Darrow argued in 2007 that a clear federal

statute prohibiting conviction discrimination would provide uniformity to

the patchwork and conflicting approach of the various state and local

legislative regimes.8Or, in another like-minded move, American Civil

Liberties Union staff attorney Linda Lye argued in her 1998 comment that

5Though related, this article will not examine in depth disparate impact actions as they relate

to arrests and employment applications, as there is a sound underpinning for EEOC action

on that basis. See, e.g., Gregory v. Litton Sys. Inc., 316 F. Supp. 401, 403 (C.D. Cal. 1970)

(“[I]nformation concerning a prospective employee’s record of arrests without convictions, is

irrelevant to his suitability or qualifications for employment.”), modified on other grounds, 472

F.2d 631 (9th Cir. 1972). We will also not address EEOC enforcement in disparate treatment

cases involving criminal convictions where the employer disqualifies members of one race

based on a criminal conviction, but not another, as those cases clearly indicate discriminatory

intent and lie at the heart of what Title VII is designed to prohibit. See, e.g., Press Release,

EEOC, Franke Foodservice Systems Settles EEOC Race Discrimination Lawsuit (Mar. 26,

2009), available at http://www.eeoc.gov/eeoc/newsroom/release/3-26-09c.cfm(discussing settle-

ment of a lawsuit arising from a company refusing to hire a black applicant into a permanent

position because he disclosed a felony conviction on his application, even though the

company hired a white applicant a year earlier who made a similar disclosure).

6See Stacy A. Hickox & Mark V. Roehling, Negative Credentials: Fair and Effective Consideration

of Criminal Records,50A

M.BUS. L.J. 201, 216 (2013) (noting that ex-offenders may also enjoy

protection against disparate impact under the ADA).

7This conundrum was highlighted in a recent news article that quoted Elizabeth Milito of

the National Federation of Independent Business about the difficulty of background

checks in the current legal environment. Milito stated that “[p]eople are confused, afraid and

saying I could get sued either way.” Joseph Weber, Feds File Civil Rights Suits on Companies

Using Criminal Background Checks for Hires,F

OX NEWS.COM ( June 22, 2013), http://www.foxnews

.com/politics/2013/06/22/obama-administration-files-suits-against-businesses-using-criminal

-background/.

8Christine Neylon O’Brien & Jonathan J. Darrow, Adverse Employment Consequences Triggeredby

Criminal Convictions: Recent Cases Interpret State Statutes Prohibiting Discrimination,42WAKE

FOREST L. REV. 991, 1025 (2007).

2014 / Race, Employment, and Crime 253