United States: OFCCP Directive Adopts EEOC Guidance And Outlines New Procedures And Existing Legal Obligations Regarding Criminal Background Checks

On January 29, 2013, the Office of Federal Contract Compliance Programs ("OFCCP") adopted the Equal Employment Opportunity Commission's ("EEOC") April 25, 2012 Guidance regarding the use of criminal records in employment decisions for covered federal contractors and subcontractors ("contractors"). The OFCCP also detailed new criminal background check procedures affecting contractors required to utilize the federally-assisted workforce system and restated existing legal requirements under the Fair Credit Reporting Act ("FCRA"). Contractors beware – Directive 306 ("OFCCP Directive") takes effect immediately.

EEOC Guidance

Like the EEOC Guidance, the OFCCP Directive warns that contractors who use criminal records in making employment decisions run the risk of violating Title VII of the Civil Rights Act of 1964 ("Title VII"). The Directive reiterates that the OFCCP follows Title VII substantive law. Indeed, even where contractor hiring and employment policies on criminal background checks do not "intentionally" discriminate against applicants or employees on the basis of a protected characteristic such as race or national origin, the OFCCP Directive cautions that the mere consideration of criminal records may disparately impact racial and ethnic minorities who tend to have higher incarceration rates.

The OFCCP Directive explicitly endorses consideration of the factors laid out in Green v. Missouri Pacific Railroad Company, 523 F.2d 1158, 1160 (8th Cir. 1975), when considering whether a conviction should be a bar to employment:

i. The nature or gravity of the offense or conduct;

ii. The time elapsed since the offense, conviction; and/or completion of the sentence; and

iii. The nature of the job sought or held.

The OFCCP Directive also reiterates the "two circumstances" set forth in the EEOC Guidance in which an employer's criminal conviction policy "will consistently meet" Title VII's "job related and consistent with business necessity" defense: (1) when employers act in accordance with the Uniform Guidelines on Employee Selection Procedures (UGESP); and (2) where validation in accordance with UGESP is not done, employers apply the abovementioned three-factor test as a "starting point." It should be noted that this safe harbor language provides federal contractors with little solace, as it is questionable whether criminal background check policy can be validated under UGESP. Furthermore, it is not entirely clear what specific steps an employer must take beyond the three-factor test "starting point."

Like the EEOC Guidance, the OFCCP Directive recommends that contractors:

  • as a general rule, refrain from inquiring into convictions on job applications and that hiring and employment decisions based on an applicant's or employee's criminal background be "job-related and consistent with job business necessity";
  • implement "policies and procedures that screen applicants and employees for criminal conduct [that] require an individualized assessment" and which are "narrowly tailored to the essential job requirements and actual circumstances under which the jobs are performed"; and
  • classify applicant and employee criminal records as strictly confidential so that they are "only used for the purpose for which [they were] intended."

For more information regarding the EEOC Guidance, see our past client alert entitled  EEOC Issues New Guidance on Criminal Background Checks.  

New Procedures and Existing Laws

The OFCCP Directive also addresses the recently issued  Training and Employment Guidance Letter (TEGL), which advises "the public workforce system and other entities . . . that receive federal financial assistance to operate Job Banks" on how to "conduct their activities using safeguards to prevent discrimination and promote employment opportunities for formerly-incarcerated individuals and other individuals with criminal records." The TEGL sets forth specific restrictions for covered entities "regarding (a) posting of job announcements and (b) screening and referring applicants based on criminal record restrictions." Contractors required to utilize such entities(such as those subject to the Vietnam Era Veterans' Readjustment Assistance Act of 1974) should expect these new procedures to affect the screening of prospective employees.

The TEGL also discusses the existing obligations of contractors under the FCRA, which requires that they obtain the applicant's permission before asking a background screening company for a criminal history report, and provide the applicant with a copy of the report and summary of rights before taking an adverse action based on information contained therein.

For recent FCRA updates, see our past client alert entitled New Year's Watch: CFPB's Model FCRA Forms Take Effect


The OFCCP's Directive signals the continued scrutiny of criminal background checks by government agencies. Contractors who inquire into applicant or employee criminal history should be mindful of the patchwork of federal and state laws, as well as agency guidance and directives limiting the use of criminal background checks. Contractors should consider conducting criminal background checks post-offer to avoid excluding qualified candidates in violation of antidiscrimination laws and, of course, ensure that consideration of conviction history is job-related and consistent with business necessity. To ensure compliance with these growing restrictions, contractors should carefully review (or create) policies regarding the use of criminal background checks in hiring and employment decisions.


The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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