Category: Administrative law

President urged to make federal hiring fairer — but is the “ask” enough to get the right result?

A coalition of national advocacy organizations has again urged President Obama to implement a robust federal hiring policy to give people with a criminal record a fair chance to compete for federal agency and contractor jobs.[1]  In an open letter dated July 20, the coalition called upon the President to issue an executive order requiring employers to conduct a criminal records check only after a conditional hiring offer has been made, and to adhere to current EEOC guidance on considering the results of a records check. The administration’s recent rhetoric indicates that it may be receptive to the coalition’s proposed reforms. On July 14, the President explicitly endorsed so-called “ban-the-box” policies in his speech on criminal justice reform at the NAACP annual convention: Let’s follow the growing number of our states, and cities, and private companies who’ve decided to ban the box on job applications so that former prisoners who have done their time and are now trying to get straight with society have a decent shot in a job interview. According to the coalition, the Obama administration has endorsed fair hiring policies since at least last spring when the My Brother’s Keeper Task Force called for banning the box. Last year, the Attorney General’s Reentry Council urged that “mak[ing] the federal government a model employer” should be a key point of the federal reentry agenda. The July 20 letter challenges the President to make good on this rhetoric: It is past time for your administration to make these powerful pledges a reality by leveraging the federal government’s considerable resources to reform the hiring process of workers employed by federal contractors and federal agencies, which account for over 20 percent of the entire U.S. workforce. The specific reform proposals in the July 20 letter incorporate, in broad strokes, the more detailed agenda outlined in a report published by NELP this past January.  But are these proposals, even if fully implemented, enough to make fair hiring a reality in the federal workplace? While ban-the-box policies have been adopted by numerous states, municipalities, and private entities, they have not yet been shown to be effective in limiting consideration of criminal records.  Some fear that they simply delay inevitable rejection.  As one woman remarked following a series of rejections based on late-stage records checks, “states with ban-the-box laws didn’t really ban those boxes; they just moved them to a different time in the hiring process.” A recent court case confirms anecdotal evidence long suggesting that employers who reject applicants with criminal histories will do so regardless of when that history surfaces.  In some cases rejection may be mandated by insurers or regulators.  If that is indeed the case, then ban-the-box policies will encourage hiring only if they are accompanied by policies that limit consideration of the record itself. Requiring federal agencies and contractors to adhere to EEOC enforcement guidance on consideration of criminal records would go a long way toward bridging that gap, but it is unlikely to close it. The EEOC guidance requires employers to conduct an individualized assessment of each applicant that takes into account the age and nature of an offense, its relationship to the job sought, and evidence of rehabilitation.  Rejection based on an applicant’s criminal history is permissible only if “job-related and consistent with business necessity” — a determination that is ultimately up to the employer. As a practical matter, it is hard to go behind an employer’s determination not to hire a particular individual, as years of Title VII litigation demonstrate.  Is a five year old shoplifting conviction related to a job where a person has access to a company supply closet?  Is a 10 year old DUI charge related to a job that does not requires driving?  One that does?   As long as employers can make an argument for job relatedness where an individual applicant is concerned, a hiring policy incorporating the EEOC guidance is likely to invite circumvention. Granted, the more detailed reforms proposed last winter by NELP would create a process that would allow applicants to appeal their rejection as inconsistent with the EEOC guidance, and empower the Office of Federal Contract Compliance to suspend or terminate contracts for failure to adhere to it.  However, unless the entities responsible for hearing appeals and assessing contractor compliance develop rules defining job-relatedness, the standards they use to review employer actions will be no clearer than those the employers are supposed to implement in the first instance. This is not to say that the EEOC guidance cannot serve as a model for an effective fair hiring policy, only that it is not enough without a viable enforcement mechanism. As the coalition says in the letter, “Absent a strong and enforceable policy, federal contractors and federal agencies will continue to violate these basic standards of law and fairness.” [2] Rather than simply appropriate the EEOC guidance, the administration should build on it. Business necessity and job relatedness ought to be touchstones of any fair hiring policy, since they acknowledge that convictions may be disqualifying but only in certain limited situations. Those touchstone concepts can be used to craft clear and enforceable agency-specific rules that clearly define when rejection is appropriate. State legislators have shied away from bright line categories allowing consideration of some records but not others, because hiring decisions so frequently depend upon the totality of facts and circumstances.  For example, New Jersey’s Opportunity to Compete Act began its legislative life with provisions barring consideration of certain dated criminal records, provisions that were omitted just prior to enactment.  Similarly, the ban-the-box law passed in Delaware would have barred consideration of convictions more than ten years old (those provisions did not survive the legislative process either). A case can be made that dated convictions (particularly minor ones) are inherently unrelated to any job, and that discrimination based on such convictions (at least categorical discrimination) is inconsistent with any sort of business necessity.  An agency or contractor should be presumptively prohibited from taking such a conviction into account, and should have a heavy burden of justification if unusual circumstances warrant taking any such conviction into account for a particular job.  If this sort of administrative standard were incorporated into agency-specific rules interpreting the requirements of the EEOC guidance, it would give a federal fair hiring policy the teeth it needs. It would be fantastic news if the President banned the box and mandated adherence to the EEOC guidance tomorrow.  But any celebration ought to be tempered by the practical reality that this would represent only the beginning of an effective federal fair hiring policy. If the President is committed to making the federal government a model employer, he must use his considerable executive authority to build on that foundation with specific policies by which agencies and contractors may be held to account, and procedures for enforcing them. We hope that he is prepared to do so.   [1] The July 20 call follows on the heels of a March 25 letter to the President from the same coalition, joined by nearly 200 additional groups including the Collateral Consequences Resource Center.   [2] The fact that the EEOC guidance is open to such broad interpretation and so difficult to enforce is not surprising given its background. The guidance was not created to aid reentry or improve internal practices.  Rather, its purpose is to help employers comply with a provision of Title VII of the Civil Rights Act that prohibits hiring practices that have a disparate impact on racial minorities and other protected classes, unless those practices are “job related and consistent with business necessity.”  Somewhat ironically, the factors and standards laid out in the EEOC guidance come directly from case law interpreting when an employer may successfully assert a “business necessity” defense — a defense that protects an employer’s right to discriminate against those with criminal records (a class of people not protected by Title VII).   Read more

SBA relaxes rule against business loans to probationers, while other federal agencies keep collateral consequences unchanged

The U.S. Small Business Administration (SBA) last week published a final rule for its federal Microloan Program that will for the first time allow microloans to small businesses owned by someone currently on probation or parole. In its announcement, the SBA noted that this will “aid[] individuals with the highest barriers to traditional employment to reenter the workforce.”  The change was evidently prompted by a review of agency regulations requested by the Cabinet-level Federal Reentry Council established in 2010 by former Attorney General Eric Holder. While the change is welcome, it leaves in place substantial restrictions for people under sentence in other SBA loan programs, discussed at length in a post on this site last December. It is also striking for being the only relaxation of federal collateral consequences since the Reentry Council was established five years ago.  As reported on this site, federal agencies are said to be “mostly satisfied” with their the way their regulations address the situation of people with a criminal record. The SBA’s Microloan Program, which is focused on startups, minority and other underserved markets, provides loans up to $50,000 to help small businesses and certain not-for-profit childcare centers start up and expand. Microloans play an important role in distressed communities where access to conventional lending remains a challenge. The average microloan size is approximately $13,000. “Small business ownership and self-employment are paths toward wealth creation and independence,” said SBA spokesman Miguel A. Ayala. “This option can be particularly useful for citizens who may have difficulty finding employment after returning to their community from prison. With millions of Americans looking to start over after incarceration or move past their criminal records, the SBA is removing barriers so that citizens can achieve economic security and be successful members of society.” . . . . This action supports the goals of the Federal Reentry Council to reduce barriers to employment and reduce recidivism. It also implements key recommendations of the President’s My Brother’s Keeper Initiative to increase access to jobs, reduce violence, and provide a second chance. If the SBA is concerned about encouraging reentry, then it needs to go further than simply expanding borrower eligibility under its microloan program.  While giving probationers and parolees access to microloans -– and to employment with microloan borrowers — will certainly allow some to reestablish themselves as productive citizens, the real employment opportunities are with businesses funded under the larger 7(a) and 504 programs, for which probationers and parolees would remain absolutely barred. These businesses are also likely to be better protected against employee fraud or malfeasance.  It is hard, therefore, not to see the proposed rule as a token gesture rather than a broad effort to open opportunities for those under supervision in the community. We note that the SBA appears to be the only federal agency to date to have made any changes in its rules or policies in response to the initiative of the Federal Reentry Council. Read more

Should a criminal record ruin a career?

The Atlantic has published an excellent article about the permanently disabling effects of a criminal record, by two attorneys at the East Bay Community Law Center (Oakland, CA), Sarah Crowley and Alex Bender (an Equal Justice Works AmeriCorps Fellow).  Haunted by the Past: A Criminal Record Shouldn’t Ruin a Career, March 25, 2015.  The authors argue, based on their experiences in their practice, that “too many applicants, particularly people of color, are being denied jobs based on background checks that are irrelevant or even inaccurate.”   They describe the sources of inaccuracy and other unreliability in criminal background checks, even ones based on fingerprinting.  But then they focus on the real problem, which is that over-reliance on background checks “inevitably screens out qualified, trustworthy job applicants.” They tell the story of one woman whose dated misdemeanor convictions deprived a California group home of a valuable employee:  Take, for example, the case of Felicia Green . . . who applied to work as a caregiver in a group home for young people and their families. In terms of experience and training, she was a model candidate: She worked for ten years as a residential advisor for a program administered by the U.S. Department of Labor. Green had stellar references, and also recently became licensed as a Covered California enrollment counselor.   Unfortunately, Green’s criminal background check revealed two old misdemeanor convictions. Her caregiver job application process, which had been going smoothly, came to a grinding halt. Green’s first conviction, [was] a DUI from more than two decades ago, . . . .  The second conviction [for welfare fraud] occurred seventeen years ago [when] she received an overpayment that she neglected to report . . . .   The relatively recent ubiquity of background checks has made it so that criminal convictions function as a modern-day scarlet letter, nearly impossible to overcome. For Green, the two decades-old convictions were her sole encounters with the criminal-justice system. But in the context of her job application, those convictions might as well have happened yesterday. The past two decades of staying out of trouble and being gainfully employed couldn’t prevent her from being flagged as a hiring risk. Even though the group home expressed interest in hiring her, bureaucratic hurdles prevented them from doing so once her convictions came to light, so in the end, Green didn’t get the job. The real unfairness for Felicia Green arose not from the background check, which seems to have been accurate, but from the employer’s willingness to rely exclusively on it, daunted by the prospect of tackling “bureaucratic hurdles.”  Most employers take the path of least resistance and least apparent risk, which may result in loss for all concerned.  The authors urge employers and occupational licensing agencies to adopt a smarter, more holistic approach to the screening process that carefully considers the information in criminal background checks as one factor among many. If an applicant has a criminal history, it’s not necessary to reject them automatically. Take into account the seriousness of the conviction, how long ago it happened, and whether it actually has anything to do with the job in question. The challenge of developing and enforcing standards for discretionary decision-making is the next frontier in dealing with collateral consequences. Read more

Title VII protections based on criminal record are modest not coercive

In a recent series of posts on The Volokh Conspiracy blog promoting his book The Eternal Criminal Record, Professor James Jacobs “[speaks] strongly against a public policy that coerces private employers to ignore job applicants’ criminal records while leaving them to cover the costs imposed by ex-offender employees.”    His arguments suggest that employers are being saddled with such costs (for which no proof whatsoever is presented) because of social activism on behalf of people with criminal records. In fact, modest legal protections for people with criminal records derive from longstanding employment discrimination law principles. Professor Jacobs claims that Title VII of the landmark Civil Rights Act of 1964, the core federal law prohibiting race discrimination in employment, has been somehow misconstrued to limit an employer’s consideration of criminal records for hiring decisions. He states that the application of Title VII to employer consideration of criminal records “remains confusing and unsettled.” He is wrong. Title VII prohibits employers from excluding applicants for any reason if that results in disproportionate exclusion of minorities from the workforce, unless there is a “business necessity” for the practice as applied. Since at least the 1980s, overbroad employer policies that reject people with criminal records – often across-the-board bans on people with convictions or even arrests – have been found to violate Title VII under this disparate impact theory, given the disproportionate criminal justice involvement of minorities.  Indeed, the first policy guidance on criminal records from the Equal Employment Opportunity Commission (EEOC) in 1987 was under the signature of current Supreme Court Justice Clarence Thomas, who has seldom been admonished  for his broad interpretations of Title VII. That EEOC policy statement identified three bedrock issues for employers to evaluate when considering criminal records that remain vital today: the length of time since the conviction; the seriousness of the crime; and the relationship between the offense and the job at stake.  These three factors help the employer determine whether or not the job applicant’s record indicates risk to the employer. Throughout his posts, Professor Jacobs indicates that employers are being forced to “ignore” criminal records. In fact, no one suggests that criminal records must be ignored, including us. But no one knowledgeable about Title VII contends that employers have unfettered discretion to consider any and all criminal records. Stated differently, blanket disqualifications of people with criminal records violate the law. Professor Jacob repeatedly assumes that having a criminal record is a proxy for being a poor employee. Do people with criminal records tend to assault people on the job? Steal from the workplace?  Come late to work?  Research tying having a criminal record to any kind of job performance simply does not exist. Indeed, what recent social science research does prove is that a criminal conviction does not even necessarily indicate that a person has a heightened risk for committing a crime in the future. As time passes without commission of a new crime, an ex-offender’s risk of committing another crime decreases, to a level of risk comparable to the rest of the population. Which highlights another important point: both people who have been convicted of crimes and those who have not may commit crimes in the future. A background check is simply not a silver bullet for identifying employees who may be trouble. Finally, people with criminal records would be shocked to hear that Professor Jacobs is arguing against what he calls a “pro-ex-offender employment policy.” Truly, there is no affirmative action for people with criminal records.  There is rejection, day after day, year after year, of people who are extremely motivated to work hard and justify an employer’s faith in them. Title VII and other laws simply try to give them a shot at proving themselves. As many as one in three American adults has a criminal record. We cannot allow such a large percentage of the population to be written off as unfit for our workforce, especially when many of them have very old or minor convictions. The employment disenfranchisement of people with criminal records is the major civil rights issue of this generation – the sort that Title VII was enacted to redress. Read more

Jerry Brown takes back a pardon . . . really?

Jerry Brown reportedly regretted one of his 105 Christmas Eve pardons, after learning from an LA Times article that the recipient had recently been disciplined by federal financial regulators.  He therefore announced that he was rescinding his grant, claiming that the pardon was not yet final because the Secretary of State had not signed the document evidencing it. This is not the first time that a governor or president has had second thoughts about a pardon, but it is unusual for a chief executive to attempt to undo one that has been made public.  Governor Brown’s attempt to retract the pardon may or may not be effective, but it certainly reflects unfortunate disarray in the administration of the pardon power in California for which other deserving pardon candidates may end up paying. Glen Williams Carnes was pardoned on December 24 for a 1989 drug-related offense committed while he was a teenager, for which he spent three years on probation.  In the pardon document, Brown stated the Carnes had received an order from the Orange County Superior Court “evidencing … he has lived an honest and upright life, exhibited good moral character and conducted himself as a law-abiding citizen.” This judicial order, styled a “Certificate of Rehabilitation,” is the first step in the California pardon process, after which applications are submitted by the governor’s office for a second vetting by the Board of Parole Hearings. Later that same day, the Times reported that [F]ederal records show Carnes was disciplined by investment regulators in May 2013. He signed a consent settlement with the Financial Industry Regulatory Authority that states he agreed to be barred from financial investment. The document alleged that he hid an outside business deal and provided investigators with “false and misleading statements that minimized and mischaracterized his involvement.” Carnes did not admit guilt. Securities and Exchange Commission records show the business deal that led to the sanction became what is now Carnes’ company: Global Vision Holdings, a publicly traded corporate umbrella of which Carnes is listed as CEO, chairman of the board and chief financial officer. Currently, Global Vision owns The Place Media, which publishes local magazines placed in hotels, Mamma’s Best, a line of organic food products, and a financial consulting firm. However, SEC records show Global Vision’s last financial report was made in late 2013. In April, it informed the SEC it could not complete its year-end 2013 filing in time “due to recent turnover in its accounting department.” Upon learning from the newspapers of the FINRA sanctions, Governor Brown moved that same afternoon to withdraw the pardon, stating that he had relied to his detriment on the court’s order of rehabilitation, and that in any case the pardon had not yet become final: “This information was not disclosed by the applicant,” Brown’s spokesman, Evan Westrup, said in a written response to The Times. “Without the certificate of rehabilitation, this individual would not have been considered for a pardon. This particular pardon has not yet been attested by the Secretary of State and it has subsequently been withdrawn.” For his part, the disappointed Mr. Carnes told the Times that he planned to contact Brown’s office “first thing on Friday morning as tomorrow is Christmas, to refute your allegations.” The Associated Press reported that Carnes said he was unaware he needed to report the regulatory settlement on his clemency application. Stay tuned for further details in this most recent pardon soap.  In the meantime, we have a couple of comments on the episode.  First of all, it is not at all clear that the Governor’s effort to retract a pardon he had already announced, on grounds that a ministerial formality had not yet been performed, will be held effective if challenged.  The Supreme Court of Michigan recently invalidated a similar attempted retraction by Governor Granholm, there of a commutation she later regretted after protests by his victim’s family.  See Makowski v. Governor, 495 Mich. 465; 852 N.W.2d 61 (June 3, 2014).  See also Marbury v. Madison, 5 U.S. 137 (1803).  We don’t know if Mr. Carnes plans to take his case to court — though the possibility of further embarrassment may discourage him.  (This is apparently why Isaac Toussie didn’t contest President George W. Bush’s retraction of his pardon under similar circumstances — a pardon that was also granted apparently without adequate staffing.) The Carnes episode also reflects poorly on the present state of the California pardon process, and on its reliability in service to the Governor.   Carnes reportedly told the Times that “he went through an extensive background check that took over a year making him eligible for his gubernatorial pardon.”   However, that background check (presumably by the BPH and the governor’s staff) evidently didn’t dig very deep to reassure the Governor that Carnes was a suitable recipient of his public mercy:  A simple Google search by CCRC staff finds Carnes listed on the website of the CFA Institute as an individual “currently serving public disciplinary sanctions for violations of the CFA Institute Code of Ethics and Standards of Professional Conduct or who have resigned their memberships while under investigation for industry-related misconduct.” Nor was the court’s certification of Carnes’ rehabilitation a very effective filter in this case. Carnes was reportedly granted his COR in August 2013, several months after the FINRA sanctions were imposed.  It is unclear whether the court knew of the sanctions when it granted the COR, though they would certainly seem to have reflected poorly on Mr. Carnes’ rehabilitation in that context as well. Finally, while the retraction is unfortunate for Mr. Carnes, it is even more unfortunate for others who are seeking a pardon from Governor Brown, since it is inevitable that an episode like this may dampen his general enthusiasm for pardoning.  This is why it is so very important that those staffing pardons for an elected official do a thorough investigation and be very sure there is nothing about a case that might cause embarrassment.  Neither the BPH nor the court appears not to have done a very thorough job in this case, if our own crude Google-limited investigative efforts are any guide.  And now others awaiting the Governor’s favor may suffer for this poor staffing. We will have more to say in this space about the administration of the pardon power in California.  We believe that its basic framework, notably its reliance on a prior judicial finding of rehabilitation, could be adapted into a comprehensive functional relief system second to none in the country. Read more