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Government Contractor Alert: Criminal Convictions and Employment Decisions Don't Mix

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On January 29, the Department of Labor, Office of Federal Contract Compliance Programs (“OFCCP”) issued Directive 306, which encourages federal contractors and subcontractors not to ask about criminal convictions on job applications. According to OFCCP, such questions can result in individuals being treated differently because of their race, national origin, sex, or other protected characteristics.

OFCCP issued the directive to address its concern that hiring policies and practices that exclude employees and potential employees with criminal records violate Title VII of the Civil Rights Act of 1964 (“Title VII”). In support of its statement, OFCCP cites a study which found that one in three adults has a criminal history record. Of those adults, a high percentage were Hispanic and African-American. Based on the study, OFCCP reasons that employers who have a blanket policy of not hiring individuals with criminal convictions will exclude a greater number of Hispanic and African-American individuals resulting in “disparate impact” on these individuals, which would likely be in violation of Title VII. Thus, because of the impact, OFCCP recommends that employers “refrain from asking about convictions on job applications."

Directive 306 is Not a Blanket Ban on Hiring Decisions Based on Criminal Convictions

The Directive expresses OFCCP’s position – don’t ask about criminal convictions unless necessary – but it does not prohibit the use of convictions in all hiring decisions by government contractors or subcontractors. Employment decisions that consider criminal convictions will likely not be in violation of Title VII as long as the employer can show that the policy is:

  1. Job related, and
  2. Consistent with business necessity.

What Federal Contractors and Subcontractors Need to Know

OFCCP has taken the position that using criminal convictions as a factor in hiring decisions can violate Title VII. To steer completely clear of possible Title VII issues, the most conservative approach would be to consider the subject of criminal convictions as off-limits when it comes to most employment decisions. To avoid potential problems, government contractors should make sure they:

  • Don’t ask about criminal convictions on employment applications; and
  • Don’t have a policy that anyone with a conviction is ineligible for hire.

The exception to the rule:

  • To have a policy that a person will not be hired based on criminal conviction, the employer must satisfy the “job related and business necessity test” and show that the policy is (1) related to the job,  and (2) consistent with business necessity.

The “job related and business necessity” test is met if the employer (1) validates the criminal conduct exclusion for the position in question in accordance with the Uniform Guidelines on Employee Selection Procedures or (2) can show how these elements relate to the job:

  • The nature and gravity of the offence – consider the legal elements of the crime and harm caused;
  • The amount of time that has passed since the offence and/or completion of the sentence; and
  • The nature of the job held or sought – how do the job duties and performance relate to the offence.