Judge Protects Employers’ Use of Background Checks

Recent legislation has attempted to limit how and when employers can use credit reports and criminal background checks during the hiring process. In pursuit of this, the Equal Employment Opportunity Commission (EEOC) has brought suits against a number of companies that the EEOC judges have been using background checks improperly. This week brought a setback for them, however, as Judge Roger Titus of the U.S. District Court in Maryland threw out their case against Freeman Companies.

Freeman Companies sued by EEOC

The EEOC was attempting to prove that Freeman Companies had been overly zealous in their use of employment checks. However, Judge Titus didn’t see the matter the same way, and his decision was no surprise. Other courts have taken similar views, including nine state Attorneys General who have chosen to protect “employers’ responsible use of employment background checks.” The EEOC, on the other hand, says its aim is to protect applicants from discrimination which background checks might make them privy to.

EEOC requires its own background checks

According to the details of EEOC v. Freeman, the company “unlawfully relied upon credit and criminal background checks that caused a disparate impact against African-American, Hispanic, and male job applicants.” Because these groups tend to have higher rates of incarceration, an impact on their employability might be predicted. However, Judge Titus said, “This is simply not the case.” He went on to explain that use of criminal background checks can be an essential part of the application process. In fact, he said, “The EEOC conducts criminal background investigations as a condition of employment for all positions, and conducts credit background checks on approximately 90 percent of its positions.”

Flaws in EEOC arguments highlighted

Another flaw in the EEOC’s argument Judge Titus pointed out was their use of faulty statistical information. Its data was based on reports by the EEOC’s statistical expert, Dr. Kevin R. Murphy, who has come under fire in the past for utilizing biased statistics. This time, Judge Titus pulled out all the stops, calling Murphy’s reports “laughable,” “rife with analytical error,” “completely unreliable,” and “so full of material flaws that any evidence of disparate impact derived from an analysis of its contents must necessarily be disregarded.”

Finally, to put a period to his decision, Judge Titus pointed out that the EEOC couldn’t pinpoint which factor of Freeman, Inc’s policy it was that made their use of employment background checks improper. This decision could be landmark, as it sets precedence for future decisions on the same topic to continue to be in favor of the employers.