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On June 11, 2013, the Equal Employment Opportunity Commission (EEOC) filed separate class action lawsuits against two employers – Dollar General Stores and BMW – alleging that these employers engaged in racial discrimination by using criminal background checks to disqualify applicants from employment.  The BMW case filed in South Carolina has a 69-person class, and is location specific.  The Dollar General case  is a nationwide case, likely consisting of 8,400 applicants/conditional employees with offers rescinded/not made.   

These lawsuits may be significant for several reasons, including the following:

 A.  EEOC Focus – EEOC Chairman Jacqueline Berrien made statements to the press supporting the filings.  The EEOC clearly views these lawsuits as consistent with its current stated focus on removing purported “barriers” to employment.   These lawsuits also appear to rely upon the EEOC’s extensive 2012 Guidance regarding the use of convictions, even though the employment decisions in question occurred well prior to the 2012 Guidance.  The bottom line – the EEOC is showing that they will aggressively litigate this issue.

B.  Strict Standards – These cases challenge a policy (BMW’s) that purportedly excluded from employment those whose criminal background checks involved convictions for rape, murder, assault & battery, child/spousal abuse, drug manufacturing and distribution, weapons violations, and convictions involving “theft, dishonesty and moral turpitude,” a policy that was challenged in part because it did not distinguish between felonies and misdemeanors.   The other policy (Dollar General’s) purportedly contained a “matrix identifying specific felonies and misdemeanors and specifying how recent these convictions must be,”  and the EEOC took issue with some of the convictions considered within the matrix, such as possession of drug paraphernalia, illegal dumping, and improper supervision of a child.  With respect to both policies, the EEOC alleged that these employers did not conduct a sufficient “individualized assessment” as to whether each individual conviction was truly job-related, and whether exclusion of the applicant was justified based on business necessity.  The Dollar General case further alleged that the employer should have considered the “age of the offender” and unidentified “events that have transpired” since the conviction. 

C.  Use of Statistical Analysis – The EEOC cites statistics in both cases in a fairly onerous manner.  For instance, without making any attempt to show that it was comparing apples to apples, the EEOC alleged that a policy that resulted in a 3% differential in disqualification between Black applicants and non-Black applicants created  a “gross disparity” and was ”statistically significant.”  In one of the cases, the majority of the workforce hired/retained was Black.   

While both filed cases have unique issues surrounding the companies’ policy applications and interpretations, the filings reflect a clear trend by the EEOC to pursue class action “pattern and practice” cases, and constitute a significant investment by the EEOC on this particular issue.  Thus, background screening practices regarding criminal background history must be reviewed.  Additionally, each employer’s policy, and the application of its policy, needs to be evaluated in the context of the particular job being filled and how screening factors are utilized.