The Northern District of California recently decided another noteworthy case. The case is a reminder to employers that, when they consider the criminal history of employment applicants, they must consider how the nature of the offense and how long ago it was committed relate to the duties of the position.
Plaintiff is a Latino born in Mexico who was brought to the United States by his parents when he was 11 years old. He began using a social security number that he “invented” to obtain employment at the age of 15.
In 1997, at the age of 17, Plaintiff applied to change his immigration status in part so he could obtain a valid social security number. While waiting for his application to be approved, he applied to the Internal Revenue Service to receive an Individual Taxpayer Identification Number (ITIN). The ITIN was issued that same year, although the plaintiff continued to use the invalid social security number that he had given his employer at an earlier date.
Ten years after making application, Plaintiff became a lawful permanent resident and received his own valid social security number in 2007. He became a United States citizen in 2011, at the approximate age of 34 years.
Plaintiff applied to be a corrections officer with California Department of Corrections and Rehabilitation (CDCR) in the summer of 2011. The CDCR operates the state prison system. Applicants are required to undergo a thorough background investigation to determine that candidates have good moral character, i.e., to evaluate applicants’ integrity, honesty, and good judgment. As part of this evaluation, applicants must answer many questions, including Question 75 which asks: “Have you ever had or used a social security number other than the one you used on this questionnaire?” Plaintiff answered “Yes” to this question and provided a supplemental answer explaining the circumstances surrounding his use of the invented social security number. Plaintiff’s record contained no blemishes other than the previous use of an invalid social security number.
In January 2012, the CDCR sent Plaintiff a rejection letter, stating:
“The fact that you committed identity theft for eight years but [sic] utilizing a social security number of a United States citizen causing unknown ramifications for that person by having income reported under their number that they were unaware of reflects that you are not suitable to assume the duties and responsibilities of a peace officer. The result of the background investigation revealed that you fail to possess these qualifications. You chose to use an unauthorized social security number even though had [sic] taxpayers [sic] ID number, shows a willful disregard for the law. This 8 year act of unlawfulness shows a lack of honesty, integrity, and good judgment.”
Plaintiff appealed the decision to the State Personnel Board (SPB) stating that he believed he was discriminated against because he was a naturalized US citizen and not a US-born citizen. The SPB reaffirmed CDCR’s decision to reject Plaintiff based on the fact that he knowingly and willfully disregarded the law by his continued use of the invented social security number even after obtaining an ITIN in 1997, thereby demonstrating a lack of honesty, integrity, and good judgment. The SPB did not schedule an evidentiary hearing before an administrative law judge to determine the merits of Plaintiff’s discrimination claim. Nor did the CDCR take any action at all regarding Plaintiff’s claim that CDCR had discriminated against him.
Plaintiff applied again with CDCR to be a corrections officer in 2013, and was again rejected. His appeal of that rejection is still pending.
The court record shows there were 23,292 candidates for the position of corrections officer from 2009 to 2014. From that pool of candidates, 42 individuals answered “Yes” to Question 75; 33 were Latino and 9 were non-Latino. Of the 33 Latinos, CDCR cleared 14 and rejected 19. Of the 19 rejected Latino candidates, CDCR rejected 9 in part because of their prior use of an invalid social security number; 2 of which the use of the invalid social security number was the only reason mentioned in the rejection letter. Of the non-Latino candidates, none were rejected because of prior use of an invalid social security number.
The court ruled CDCR’s use of Question 75 had a disparate impact on Latinos. Even though Question 75 was asked of all candidates and was a “facially neutral employment practice,” it had a significant disparate impact on a protected class, i.e. race, color, religion, sex, or national origin.
The fact that some Latinos who answered “Yes” to Question 75 were hired was not enough to sway the court. Showing that others within a protected class are not subject to adverse action is not a defense to a disparate-impact claim. The Supreme Court has held that focusing on the number of minorities that were hired or promoted would inappropriately ignore the disparate effect of a specific requirement or practice. So in this case, the fact that other Latinos who answered “Yes” to Question 75 were hired did not absolve CDCR from the practice that ultimately had a disparate impact on Latinos.
In defense of a disparate-impact claim, an employer must show a “business necessity” for its practice. To do this, an employer has to show that its employment practice is “significantly job-related” and serves a legitimate business interest. Although the Plaintiff was never arrested for, charged with, or convicted of any crime involving the use of an invented social security number, that use probably was a crime and the Plaintiff had admitted to the conduct, so the court analyzed the situation under precedent related to the use of conviction records in making employment decisions. Case law establishes that even where criminal convictions are concerned, an employer cannot implement “a sweeping disqualification for employment resting solely on past behavior... where that employment practice has a disproportionate racial impact and rests upon a tenuous or insubstantial basis.” Green v. Missouri Pac. R.R. Co., 523 F.2d 1290, 1296 (8th Cir. 1975). According to Green, employers cannot disqualify applicants based on a single criterion. Instead, employers must consider the following to prove business necessity: (1) the time elapsing since the conviction; (2) the degree of the criminal’s rehabilitation; and (3) the circumstances under which the crime was committed.
Although this case did not involve an arrest or criminal conviction, the court ruled CDCR failed to establish a business necessity by applying the Green factors because there was no evidence that it individually assessed Plaintiff’s application based on the Green factors. The court reviewed and explicitly approved of, and deferred to the Equal Employment Opportunity Commission’s (EEOC) 2012 guidance on the use of criminal records in employment. Specifically, it adopted the EEOC’s approach of asking whether the employer individually assessed the three Green factors. In doing so, the court performed its own individual assessment and found that the Plaintiff’s prior use of an invalid social security number was not linked to the ability to maintain honesty, integrity, and good judgment as a corrections officer.
The court ruled that because Question 75 had a disparate impact on Latinos, CDCR can use it only if it also considers the Green factors under the EEOC guidelines. And, because it failed to consider the Green factors, CDCR made an adverse employment action based on a single-issue which amounted to an “arbitrary... barrier of employment.”
Plaintiff won his disparate-impact claim because CDCR failed to (1) prove a business necessity for its practice of considering information that, although facially neutral, had an adverse impact on a protected class; and (2) consider mitigating factors when applying qualification criteria. CDCR denied Plaintiff employment based on conduct he engaged in as long as 14 years prior to his application for a position with CDCR, starting when he was a teenager.
Effective employment policies and processes involving the use of criminal history are essential. Employers must ensure that their hiring policies measure the person for the job and not the person in the abstract.
Some best practices based on this subject are:
- When adjudicating employment qualifications based on criminal history, employers must consider (1) the nature and gravity of the offense or conduct; (2) the time that has passed since the conduct; and (3) the nature of the job held or sought.
- If an employer asks questions in an application form that allows it a deeper look at the applicant than the criminal history does by itself, the employer must actually consider any response and would be well advised to document its decision-making process.
For these updates and much more on the FCRA, EEOC Guidance, various state laws and other compliance questions, please visit backgroundchecks.com’s compliance resources hub and compliance updates archives.
About Michael Klazema The author
Michael Klazema is Chief Marketing Technologist at EY-VODW.com and has over two decades of experience in digital consulting, online product management, and technology innovation. He is the lead author and editor for Dallas-based backgroundchecks.com with a focus on human resource and employment screening developments.