Legal Challenges for Healthcare Employers with Using Criminal Background Checks

Caught Between The Laws:
Legal Challenges for Healthcare
Employers with Using Criminal
Background Checks
Kristin Brooks Jones
Assoc. General Counsel, VP of Compliance

Presented by…
Kristin Jones
Assoc. General Counsel,
VP of Compliance
HireRight
Proprietary and Confidential — HireRight – For HireRight-Authorized Recipient Only – Further Distribution Prohibited
HireRight ® Copyright © 2017. All Rights Reserved.

(… because background screening isn’t
complicated enough already…)
Caught Between The Laws:
Legal Challenges for
Healthcare Employers with
Using Criminal Background
Checks

Caught Between The Laws…
 “Barrier Crimes” Applicable To Healthcare Facilities
 2012 EEOC Guidance
» Pre-emption of state law?
 Texas Lawsuit Against The EEOC
» What It’s About
» Current Status
 What Does This Mean For Healthcare Organizations?
4

Barrier Crimes In Texas
6
 Barrier crime = bar to employment
 Texas Health & Safety Code §250.006: Convictions
barring employment
 Facilities covered:
» Nursing facility; custodial care home
» Assisted living facility
» Home and community support services agency
» Day activity and health services facility
» ICF-IID
» Adult foster care provider
» Facility that provides mental health services; mental health authority
» Special care facility
» Hospital mental health service unit
» Pediatric extended care center

7
 Any conviction (26 listed – includes similar federal,
state and Military laws) – barred from employment in a
facility:

8
 Convictions within 5 years (7 listed) – barred from
position involving direct contact:
 Additional barrier crimes for nursing homes and
assisted living facilities: burglary (and similar federal,
state and Military laws)

Barrier Crimes
9
 Texas isn’t alone
 Many other states also have some form of barrier
crimes applicable to certain types of healthcare
organizations
» See HireRight’s State Legislative Summaries for Health Care

Helping People Get Hired
Great Candidate Experience
Providing True Global Insight
Scale with Personalized Service
2012 EEOC Guidance
11
 Goal: eliminate hiring barriers for individuals in
protected categories (e.g., race, national origin)
 How: challenging policies and practices that exclude
applicants based on criminal history
 Theory: arrest and incarceration rates 2-3 times higher
for African American and Hispanic men. Therefore,
criminal history hiring policies can have a disparate
impact on these socio-economic groups.
 https://www.eeoc.gov/laws/guidance/arrest_conviction
.cfm

2012 EEOC Guidance
12
 The EEOC strongly discourages automatic
disqualification
» Employers should have a targeted screening policy that is job related
and consistent with business necessity
» Employers should perform an individualized assessment of the
candidate, crime and position sought
 Individualized Assessment
» Provide notice to the candidate that a record was identified
» Allow candidate to explain the circumstances and any mitigating
information
» Evaluate the totality of facts and circumstances.

2012 EEOC Guidance
13
 Individualized assessment evaluation should consider:
– The facts or circumstances surrounding the offense or conduct;
– The number of offenses for which the individual was convicted;
– Age at the time of conviction, or release from prison;
– Time and history since conviction;
– Whether the individual performed the same type of work, post conviction;
– The length and consistency of employment history before and after the
offense or conduct;
– Rehabilitation efforts, such as education/training;
– Employment or character references and any other information regarding
fitness for the particular position; and
– Whether the individual is bonded under a federal state or local bonding
program federal, state, program.

2012 EEOC Guidance
14
 The EEOC takes the position that state and local laws
are preempted by Title VII if state/local law will result in
an unlawful employment action (e.g., disparate impact)
According to the EEOC, tailoring a screening policy to
meet state or local requirements may not shield an
organization from potential liability!

• Philadelphia, PA
• Portland, OR
• Prince George’s County, MD
• San Francisco, CA
• Seattle, WA
• Washington, DC
(Beyond The) 2012 EEOC Guidance
15
 A number of states and local jurisdictions also have
individualized assessment requirements:
» New York State – New York Correction Law Article 23-A
» 10 local jurisdictions:
• Austin, TX
• Columbia, MO (encouraged)
• Chicago, IL (City of Chicago/sister
agencies)
• Los Angeles, CA
• New York City, NY
» Many of these laws have exceptions when federal/state/local laws
require criminal history background checks or bar employment based
on criminal history

(Beyond The) 2012 EEOC Guidance
16
 Several states have “rational relationship”
requirements:
» Hawai’i (HRS § 378-2.5)
» New York (New York Correction Law Article 23-A)
» Pennsylvania (18 Pa.C.S.A. § 9125)
» Washington (RCWA 19.182.020)
» Wisconsin (W.S.A. § 111.335)

Opposition to 2012 EEOC Guidance
18
 Legislative effort to prevent enforcement:
» H.R. 5326 – stated that no appropriations funds may be used to
implement, administer, or enforce the EEOC Guidance.
» Passed House but did not go anywhere in Senate.
 Letter to EEOC from 9 State Attorneys General
(Alabama, Colorado, Georgia, Kansas, Montana,
Nebraska, South Carolina, Utah, West Virginia)
» Submitted in reaction to EEOC lawsuits against Dollar General and
BMW – cases involving targeted “bright line” screening
» Accused EEOC of “gross federal overreach”, creating a new
protected class

Opposition to 2012 EEOC Guidance
19
 EEOC response:
» “Misunderstanding”
» 2 step process:
– Targeted screen: nature of crime, time elapsed, nature of job
– Individualized assessment
» Preemption of state law: merely recites Title VII which states that
federal law preempts contradictory state or local law.

Texas v. EEOC
20
Then Texas took the opposition a step further…

Texas v. EEOC
21
 November 4, 2013: Texas filed suit against the EEOC
» United States District Court, Northern District of Texas
» Brought under the Administrative Procedure Act (“APA”), 5 U.S.C. §
702, and the Declaratory Judgment Act, 28 U.S.C. §§ 2201, 2202
» Texas is an employer:
– Hundreds of thousands of employees across state agencies
– Many agencies have barrier laws: state troopers; programs for elderly and
disabled; lottery workers; game wardens; school districts
» Alleges that the 2012 EEOC Guidance is “invalid on its face”
» Seeks declaratory and injunctive relief against the EEOC that the
2012 EEOC Guidance is unlawful and cannot be enforced against
Texas

Texas v. EEOC
22

Texas v. EEOC – N.D. Tx.
23

Texas v. EEOC – 5th Circuit
24

Texas v. EEOC
25
 Case dismissed 8/20/2014 by the District Court for lack
of subject matter jurisdiction
» 2012 EEOC Guidance is not a “final agency action”
» No enforcement action has been taken by the EEOC against Texas
 Texas appealed to the Fifth Circuit
 3 judge panel of Fifth Circuit reverses the District
Court and remands to the District Court (6/27/2016)
» 2012 Guidance is a “final agency action” for purposes of APA and is
ripe for review

Texas v. EEOC
26
 3 judge panel vacates/remands to the District Court
» Court instructed to consider in light of U.S. Army Corps of Eng’rs v.
Hawkes Co., 136 S. Ct. 1807 (2016)
– Hawkes held in the context of the Clean Water Act that a jurisdictional
determination (“JD”) is a final agency action that is subject to judicial
review under the Administrative Procedure Act, 5 U.S.C. § 704
 Issue has now been briefed by both parties and is
awaiting the District Court’s decision
 Case has been pending for over 3 years, but there has
still not been any substantive ruling on the merits

Implications for Healthcare Organizations

Implications
28
 An already challenging and confusing landscape is even
more so for healthcare organizations
 In some cases, there is no clear path – healthcare
organizations face choice between complying with state
“barrier crime” requirements or being challenged under
EEO or (potentially) Ban-the-Box laws
 Healthcare organizations need to work closely with legal
counsel to fully understand and evaluate all of the
competing obligations
 Ultimately - healthcare organizations need to implement
policies and procedures that balance these obligations as
appropriate for their organization

Three Key Takeaways
29
 State laws impose restrictions against who can be
employed in certain types of healthcare positions
 Individualized assessment requirements seem
inconsistent with state restrictions
» EEOC Guidance
» Ban the Box laws (but exceptions)
 Landscape still evolving:
» Texas v. EEOC seeks to reconcile but time will tell
» Will new administration modify the EEOC position?
» In the meantime, consult legal counsel and weigh/balance competing
obligations

HireRight Information Presented
HireRight prepared these materials for informational
purposes only. These materials are not intended to be
comprehensive, and are not a substitute for, and should not
be construed as, legal advice. HireRight does not warrant
any statements in these materials. Employers should direct
to their own experienced legal counsel questions involving
their organization’s compliance with or interpretation or
application of laws or regulations and any additional legal
requirements that may apply.
This presentation outlines our general product direction. This
presentation, our strategy and possible future developments are
subject to change.

Legal Challenges for Healthcare Employers with Using Criminal Background Checks

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