Employment Discrimination Based on Criminal History: A Cautionary Tale

The laws around employment background reports are vast. If you use background reports, you probably take care to follow all applicable federal, state, and local consumer reporting laws.

In addition to consumer reporting laws, you may want to consider anti-discrimination laws, too. Some states and cities have anti-discrimination laws that could prohibit conviction record discrimination.  Failing to consider state and local laws before making employment decisions based on criminal history could land an employer in hot water.

One Company’s Misstep

A Wisconsin employer is learning this lesson as outlined in the recent case of Cree, Inc. v. LIRC.

Cree, Inc., a company that manufactures and sells lighting products, offered a conditional offer of employment to an applicant contingent on a drug screen and background check.  The employer rescinded the offer of employment when the background report revealed that the applicant had “2012 convictions for strangulation/suffocation, fourth-degree sexual assault, battery, and criminal damage to property related to a domestic incident with a live-in girlfriend.”

The applicant had applied for an “Applications Specialist” position that would have the applicant working with more than “1100 employees, including about 500 women” in a facility that “includes a manufacturing space, storage areas with racks of parts, plus offices, conference rooms, cubicle farms, breakrooms, and the like.”  The applicant would have access to the entire facility, including areas without security cameras.  The position also included regular client interaction and unsupervised travel to both client locations and trade shows.

Tough Lesson in Court

The applicant “filed a discrimination complaint with the Wisconsin Department of Workforce Development alleging that [the employer] unlawfully discriminated against him when it rescinded a job offer for an Applications Specialist position based upon his conviction record.”  The Wisconsin Labor and Industry Review Commission (LIRC) found that the employer violated Wisconsin law and rescinded the “job offer based solely on his conviction record.”

A Wisconsin appellate court recently upheld the LIRC’s finding and held that the employer violated Wisconsin law.  The court states that “Wisconsin law prohibits an employer from refusing to hire a prospective employee on the basis of his or her conviction record…  The employer may, however, so discriminate if ‘the circumstances of [any felony, misdemeanor, or other offense] substantially relate to the circumstances of the particular job’ for which the employee is being considered.”

Disagreements on What “Substantially Relates”

Justifying its decision to rescind the offer of employment, the employer noted that the Applicant Specialist position would create “significant opportunity with which [applicant] could ‘commit additional crimes against persons and property.’”  The employer also stated that the applicant “would have… regularly interact[ed] with female coworkers whom he could later harm outside of work.”

The Cree court found that this argument was not enough to rescind the offer of employment to the applicant based on his conviction record.

The court noted that the applicant’s “criminal record does demonstrate a ‘tendenc[y] and inclination…’ to be physically abusive toward women in a live-in boyfriend/girlfriend relationship.”  However, the court held that “it would require a ‘high degree of speculation and conjecture’ to conclude that [applicant] would develop a live-in boyfriend/girlfriend relationship through the Applications Specialist job and… that mere contact with others at the facility and on the job is not substantially related to [applicant’s] domestic violence.”

The Cree court determined that the employer’s decision to rescind the offer of employment was “less focused on the circumstances of the particular job… and more focused on the general sense that [the applicant] is not fit to be unconfined from prison and participating in the community at all due to his prior crimes, even though he has long since finished serving the confinement portion of his sentence.”

Employers would be wise to take note of the Cree decision. Check state and local anti-discrimination laws before making an employment decision based on criminal history.

Not sure if any laws that would prevent you from using criminal history when hiring?  Talk to your legal counsel for the answers you need.