LIMITATIONS ON AN EMPLOYER'S ABILITY TO CONSIDER ARREST OR CONVICTION RECORDS OF A JOB APPLICANT
(1998)

Many employers will be surprised to learn about the relatively recent shift in the attitudes of courts and legislatures towards an employer's right to view criminal records of a prospective employee. An employer's ability to investigate or consider an employee's criminal background is now affected by a number of state and federal laws, including Title VII of the Civil Rights Act of 1964, and other anti-discrimination legislation. The underlying public policy, set forth in the Equal Employment Opportunity Commission ("EEOC") Policy Statement on Conviction Records, is that the use of such records "has an adverse impact on [minorities] in light of statistics showing that they are convicted at a rate disproportionately greater than their representation in the population."

California's statutory and regulatory scheme precludes employers from asking applicants about arrest records that did not result in convictions and about misdemeanors that have been successfully discharged. (California Labor Code § 432.7(a) and 2 California Code of Regulations § 7287.4(d)(1).) Moreover, an employer cannot require an employee to provide a copy of his or her criminal history records. (California Penal Code § 13326.) The EEOC Policy Guidance on the Consideration of Arrest Records states that a "blanket exclusion of people with arrest records will almost never [with]stand scrutiny." The courts have also held that an employer cannot use convictions, including felony convictions, as an absolute bar to employment. The standard that has been adopted by both the courts and the EEOC is that the refusal to hire the applicant must be justified by a business necessity. According to the EEOC, while making the employment decision the employer must consider the "nature and gravity of the offense," the "time that has passed since the conviction," and the "nature of the job" in question. These requirements have been interpreted to mean that the employer must be able to establish that an applicant's conviction record has left the employer with no acceptable alternative except that of eliminating the applicant.

Consistent with these rules, courts have held, for example, that conviction of a felony or misdemeanor should not per se constitute an absolute bar to employment of firemen seeking positions with the Minneapolis Fire Department; that a railroad's policy of refusing for consideration of employment any person convicted of a crime other than a minor traffic violation is unlawful; that a corporation's standard policy of refusing to hire applicants who have been arrested on a number of occasions violated Title VII; and that a school district was liable for damages for changing a teacher's assignment because he was arrested for an alcohol-related misdemeanor offense.

There are important exceptions to these general rules. In certain positions where trustworthiness is a bona fide necessity, the law may allow or even impose an affirmative duty to investigate the criminal background of the applicant, and may even preclude employment of persons convicted of certain crimes. These exceptions are generally found in the areas of childcare facilities healthcare facilities, and positions where the employee can access drugs or money.

Failing to follow the legal maze regarding use of an applicant's arrest and conviction records may subject the employer to claims of discrimination or invasion of privacy by the applicant. Further, California law provides that under certain circumstances an employer may be sued by a third person if the employer is negligent in hiring or retaining an employee who is incompetent or unfit. Such liability may arise where an employer had reason to believe that hiring an applicant would create an undue risk of harm.

Federico v. Superior Court is an interesting recent case from the California Court of Appeals, which explores the issue of whether an employee with a criminal background was suitable for the position for which he was hired. The Federico Court held that as a matter of law, a hairstyling college that hired a stylist previously convicted of sexual misconduct with juvenile males could not be held liable for negligent hiring or supervision as a consequence of the employee's subsequent molestation of a student's juvenile son. The court reasoned that the employer could not have reasonably foreseen that the employee would present an undue risk of harm because the prior convictions did not involve students or customers of the hairdressing establishments where the employee worked, and there was nothing in the record to suggest that the employee engaged in inappropriate behavior on the job prior to the molestation. Moreover, the court noted that an employer is not charged with guaranteeing the safety of anyone its employee might incidentally meet while on the job, independent of the injuries caused by the employee's performance of work related functions. The Federico court held that an employer's duty, "as defined by California authority and the Restatement, is breached only when the employer knows, or should know, facts which would warn a reasonable person that the employee presents an undue risk of harm to third persons in light of the particular work to be performed." The Federico case illustrates that the suitability of an applicant is not evaluated in a vacuum, but rather in relation to the job position that applicant is going to fill.

Navigating this hiring maze requires an employer to tread a fine line between impermissible disqualifying a potential employee with a criminal record and negligently hiring such an employee who then injures a third party. An employer would be well advised to seek the advice of counsel who can assist in the development of an employment screening process that will guard against potentially negligent hires, without discriminating against legitimate applicants with criminal records.

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