August 23, 2013

EEOC gone wild? State Attorneys General call out EEOC for expansive disparate impact theory

By Anastasia P. Boden Attorney

We’ve posted before on the Equal Employment Opportunity Commission’s (EEOC) attempt to hold companies liable for using criminal background or credit checks when evaluating job applicants.  EEOC has alleged that such practices cause a disparate impact on minorities, in violation of Title VII.  As we noted, courts have not looked favorably upon EEOC’s suits.  In January, a federal district judge refused to admit EEOC’s evidence that Kaplan University’s use of credit checks caused a disparate impact on black applicants.  EEOC had compiled a panel of “race raters” who were tasked with looking at the applicant’s DMV photos and determining their race.  And just last week a different district court judge denied EEOC’s evidence in a case against Freeman companies, calling the evidence “completely unreliable,” and “rife with analytical errors.”

Recently, nine state Attorneys General weighed in on EEOC’s attempts to micro-manage companies’ employment decisions.  In a letter sent to the EEOC Chair and Commissioners, the Attorneys General note several deficiencies in the Commission’s disparate impact cases against Dollar General and BMW.  The AGs point out that EEOC does not allege in either case that the companies had any discriminatory purpose in crafting their hiring policies.  The Commission does not assert that the companies instituted background checks based on racial stereotypes of criminal behavior, nor claim that the companies treated members of different races who had similar criminal records differently.  The AGs speculate that EEOC may be more interested in extending Title VII protection to former criminals than in protecting those who have been harmed by discrimination.

As evidence, they point to EEOC’s directive that employment decisions regarding individuals with criminal histories should be individualized, and take into account how the applicant may have been reformed in the years between their conviction and their employment application.  Such directives seem to be more interested in the purported unfairness of excluding this group from employment than eradicating racial prejudice.  Whether unfair or not, this practice is not the target of Title VII.  As the AGs note, “Title VII’s prohibition on practices that have a disparate impact should not be used as just another regulatory tool to advance [EEOC’s] policy agenda.”

This is part of a larger backlash against EEOC’s assault on rational, race-neutral hiring policies.  Earlier this month, a court awarded CRST Van Expedited $4.6 million in attorneys’ fees after the EEOC brought an “unreasonable and groundless” sexual harassment suit against the company.  And in a pending case, Case New Holland, Inc. is suing EEOC for allegedly sending a mass email to 1,000 employees that solicited plaintiffs for a class action discrimination lawsuit.  Case New Holland alleges that EEOC’s trolling constituted a violation of the Administrative Procedure Act, its constitutional rights, and EEOC’s own policy.

Only time will tell if EEOC will continue its aggressive and legally suspect disparate impact enforcement actions in the face of many judicial setbacks, and mounting public opposition.

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