Thursday, September 10, 2015

BMW settles EEOC background-check lawsuit for a cool $1.6 mil

Last month, a South Carolina federal judge denied BMW’s attempt to dismiss an EEOC lawsuit which alleged that the company’s criminal background checks for job applicants had a discriminatory disparate impact on African American (opinion here).

In the wake of that decision and looming trial date at the end of this month, BWM and the EEOC have agreed to settle their differences. In exchange for the EEOC’s dismissal of its lawsuit, BMW will pay $1.6 million, and offer employment to 56 of the claimants and up to an additional 90 other African-American applicants identified by the EEOC.

Interesting, Judy Greenwald, at Business Insurance, quotes both BMW and the EEOC, each of which holds a very different opinion on what this settlement has to say about an employer’s use of criminal background checks:

“EEOC has been clear that while a company may choose to use criminal history as a screening device in employment, Title VII requires that when a criminal background screen results in the disproportionate exclusion of African-Americans from job opportunities, the employer must evaluate whether the policy is job-related and consistent with a business necessity,” said David Lopez, the EEOC’s general counsel, in the statement.

BMW said in its statement that the settlement “affirms BMW’s right to use criminal background checks in hiring the workforce at the BMW plant in South Carolina. The use of criminal background checks is to ensure the safety and well-being of all who work at the BMW plant site.

“BMW has maintained throughout the proceedings that it did not violate the Civil Rights Act of 1964 and does not discriminate by race in its hiring as evidenced by its large and highly diverse workforce.”

At the end of the day, the resolution of this case has very little to do with the legality of criminal background checks (and whether they are discriminatory) and everything about two litigants buying off off the risk of a trial on the issue. For now, the safest course of action for employers is to follow the EEOC’s Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions under Title VII (at least until the federal courts tells us otherwise).