The EEOC says that using credit checks when hiring is discriminatory


Author: Joshua Thompson

Back in August, I reported on a complaint filed in California alleging that First Transit's policy of using credit checks when making hiring decisions was discriminatory.  It seems that was only the tip of the iceberg.  Now, our own government is making the same ridiculous claims

Here is a snippet of what I wrote back in August:

Of course, there is nothing inherently discriminatory about credit and background checks. But disparate impact theory, as I have blogged about many times, does not require any showing of an intent to discriminate.  Instead, to make a prima facie case for disparate impact, plaintiffs need only show that some non-discriminatory criterion (i.e. objective test scores), when used to make a hiring decision, statistically burdens certain races more than others.  The burden then shifts to the defendants to prove that the criterion is either job-related or needed for business necessity.

Surely, some businesses may, through pure race-neutral happenstance, achieve a workforce that is in perfect "balance" with the population of a given community/state/nation.   But the odds of such result happening are not great.  It is much more likely that non-discriminatory actions may result in a work force that does not perfectly match the population.  It is ridiculous to find liability on the basis of non-discriminatory action that would naturally occur absent any discrimination.  Indeed, statistically speaking, it should raise a red flag that a company is racially balancing its workforce, if it were to come out that the workforce was always in perfect "balance." 

PLF will continue to monitor these cases.  It would surely be a sad day if businesses are prevented from using these legitimate criteria for fear of lawsuits.