A closer look at criminal history

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Under the Wisconsin Fair Employment Act (“WFEA”), the circumstances of the pending criminal charge must be substantially related to the circumstances of the team member’s particular job before a job offer may be rescinded due an arrest and/or conviction record. What exactly does that mean?

In recent years, the substantial relationship test has been interpreted very narrowly, requiring a strict case-by-case analysis. A recent case proves this point. In Featherston v. Roehl Transportation, the Complainant was discharged because of her conviction for public assistance fraud. Her job entailed checking references, previous employment, and criminal backgrounds of applicants for driver positions. The complainant handled confidential driver information, including, but not limited to, the applicants’ names, addresses, telephone numbers, birth dates, drivers’ license numbers, and Social Security numbers. (LIRC, July 23, 2010).

The question raised was whether the circumstances of the Complainant’s conviction record were substantially related to the circumstances of the job. The Respondent raised two arguments asserting that the Complainant’s conviction record was substantially related to the circumstances of her job. First, the Respondent argued that it was concerned about identity theft. Second, the Respondent stated that it was concerned Complainant might hire an unsafe driver because the Complainant would purposefully omit information regarding the applicant, intimating that the Complainant might be willing to manipulate test results for financial gain and bend the rules in terms of the drivers hired.

Each of these arguments was analyzed separately – and quite distinctly – by LIRC. In regard to the second argument, LIRC specifically rejected it, stating that it seemed “unlikely that driver applicants would attempt to bribe the Complainant to disregard their drug test results, and the Respondent did not demonstrate that this had ever occurred in the past.” LIRC also noted that because the Complainant had no direct contact with job applicants, she was not in a position to engage in the type of conduct Respondent described. LIRC did, however, place credence on the Respondent’s first argument, stating that the Respondent’s concern about identity theft was a legitimate one, as access to Social Security numbers, birth dates, driver’s license numbers, and other personal identification information is a circumstance that could facilitate criminal activity by someone predisposed to engage in fraud for economic gain.

What is most interesting, however, is what LIRC noted as its reasoning for its findings. LIRC stated in regard to prior convictions for fraud or theft, that such a conviction is substantially related to virtually any job providing an opportunity for new acts of fraud or theft. What does this mean for employers? Does this change the substantial relationship test once more, indicating that LIRC will not examine the specific tendencies and inclinations of a given conviction?

The answer is no. The substantial relationship test still seems to be analyzed narrowly and on a case-by-case basis. However, there still seems to be some broad based categories which LIRC utilizes. In other words, while there is a case by case analysis, it appears as though LIRC leaves employers some wiggle room, at least in the context of theft convictions, finding that where there an employee has committed theft in one category, there is the propensity to again commit theft when given the opportunity. However, the Featherston decision makes it clear that LIRC will not universally accept any argument made by an employer as to why a substantial relationship exists, and in fact, the Featherston decision demonstrates than an employer’s decision must have a sound basis in fact. Given such a determination, employers should take the following steps in arrest and conviction cases:

• Make a case-by-case determination: Employers cannot simply make a determination that because an applicant has a certain conviction, they will be barred from any and all jobs. Employers must make a case by case determination, ensuring that the elements of the crime are substantially related to the position applied for.
• Inquire as to the circumstances of the conviction: While employers must conduct a case-by-case analysis in terms of the substantial relationship test, the law is clear that an applicant can be excluded from employment where they were dishonest as to their previous conviction record. Accordingly, employers should carefully inquire as to the conviction record. Leave ample room on the application for an applicant to be able to describe the previous conviction record. Establish clear interview guidelines for making further inquiries. Often, employers lose on the substantial relationship test, but win due to an applicant’s failure to honestly and accurately disclose their previous conviction record. Along those lines, keep interview notes and have a uniform process in place for interview questions concerning arrest and conviction records.
• Conduct a Disparate Impact Analysis: In recent years, the EEOC has taken an interest in arrest and conviction background checks. Employers should conduct a disparate impact analysis in order to ensure that their policies are not creating a disparate impact on one particular group of applicants, as that is a potential area of interest for the EEOC.
• Note the distinction between the Madison Local Ordinance and the WFEA: There are some striking differences between the Madison Local Ordinance and the WFEA in terms of the use of arrest and conviction record information. For instance, under the Madison Local Ordinance, convictions that occurred within the past three years can be considered. The WFEA does not have such a timeframe. For those employers conducting business throughout the state of Wisconsin, be mindful that the Madison Local Ordinance is even more narrowly drawn than the Wisconsin Fair Employment Act.

Marcie Cornfield is an attorney at Gonzalez Saggio & Harlan LLP, practicing employment law in the Milwaukee office. She can be reached by telephone at 414-277-8500 or via email at [email protected].