Title VII Is Still a Consideration Even After Employer Win in Background Check Case

  • Home
  • News Blog
  • News
  • Title VII Is Still a Consideration Even After Employer Win in Background Check Case
Featured Title VII Is Still a Consideration Even After Employer Win in Background Check Case (1)

Background checks are a key tool for employers to make educated decisions about potential candidates for employment. However, they also come with stringent legal requirements, including the Fair Credit Reporting Act (FCRA) and Title VII of the Civil Rights Act. Employers must ensure that they understand and comply with these requirements in order to avoid disruption and burdensome litigation. A recent case before the Court of Appeals for the Eighth Circuit has once again illustrated this in what became a positive turn of events for an employer.

In this case, the plaintiff had applied for a position with the defendant. On her application, she stated that she had never received a felony conviction. The defendant made a conditional offer of employment to the plaintiff contingent upon the outcome of a background check. The plaintiff accepted, and the employer then arranged for a background check with a third-party provider who provided a report showing that the plaintiff had previously been convicted of armed robbery and murder, for which she served twelve years in prison.

As a result of the report, the employer rescinded the conditional offer, but according to the plaintiff’s complaint, they failed to provide a copy of the background check report prior to making the decision to rescind the offer. The applicant did not dispute the conviction with the employer or background check provider but instead filed a lawsuit alleging violations of the (FCRA). The plaintiff claimed that the employer failed to provide her with an opportunity to discuss the conviction and potentially alleviate any concerns.

Under the conditions of the FCRA, employers face several requirements when performing or receiving a consumer report which is how the Act refers to background checks for employment as well as for credit reporting. Under this Act, employers supply candidates for employment with a copy of their background check and a summary of their rights under the FCRA and give them reasonable time to dispute the accuracy of the report before taking adverse action. Despite the employer’s failure to comply with these procedural requirements, the court found that the plaintiff could not succeed in their claims because the FCRA only provides applicants with a right to dispute inaccurate information, not discuss information that is accurate yet negative.

This ruling is quite positive for employers; however, in addition to the FCRA, employers should consider other laws which may also affect how background check reports may be considered in the hiring process. Among these is Title VII of the Civil Rights Act, which the Equal Employment Opportunity Commission has previously warned may raise the potential of liability for employers who make decisions based on a background check due to disparate impacts this can have on certain protected classes.

Title VII also requires employers to consider a business necessity in making a decision to bar individuals from employment due to their criminal history. This means that the criminal history of an individual should have a relation to the duties or responsibilities of the position for which they are being considered. 

As a result, despite the ruling, in this case, employers should apply caution and perform due diligence before denying a candidate employment on the basis of a background check. It’s important to regularly revisit your company’s screening policies and ensure that you are working with a background check provider that can help you ensure your entire screening process is compliant with federal, state, and local laws.

Pre-employ can help your company stay compliant with new guidelines. Download our guide on 5 Tips To Avoid FCRA Non-Compliance to discover more.