EEOC Broadens and Clarifies Scope of Title VII Enforcement
by:Labor and Employment Practice
Equal Employment Opportunity Commission extends Title VII protection to transgendered individuals, and provides updated guidance for employers on the consideration of arrest and conviction records in employment decisions.
This week, the U.S. Equal Employment Opportunity Commission (EEOC or the Commission) took two major actions that broaden the scope of its enforcement of Title VII of the Civil Rights Act of 1964 (Title VII), which prohibits employment discrimination based on race, color, religion, sex, and national origin, and signal the Commission's intent to continue its aggressive enforcement related to the use of criminal history. First, in a landmark ruling, the EEOC held that transgender workers are protected by Title VII, and, second, the EEOC issued updated guidance concerning employers' use of criminal arrest and conviction records when making hiring and other employment decisions. Both developments should be of significant concern to employers, as we expect that the EEOC will aggressively pursue both issues in charge investigations and enforcement matters.
EEOC Holds That Transgender Workers Are Protected by Title VII
In a precedent-setting opinion issued on April 23, the EEOC held that transgender workers are protected by Title VII. The decision came in the case of Mia Macey, a transgender woman who alleges that she was denied a job with the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) after she disclosed that she was in the process of transitioning from male to female. The opinion is the first from the EEOC to address legal protections for transgender employees, and although its most immediate impact will be felt by federal employers that are directly regulated by the agency, it also has far-reaching implications for private companies. Because the EEOC is responsible for interpreting and enforcing Title VII on a nationwide basis, employers in every state—even those in jurisdictions without statutory protections for transgender employees—could now face federal claims of discrimination by employees who are not traditionally gendered.
In response to this complaint, the EEOC informed Macey that it would be dividing her claims into two categories—those that were covered by Title VII and those that were not. According to the agency, gender identity was not covered by Title VII and therefore Macey was entitled to less protection and fewer remedies. Macey objected, contending that discrimination on the basis of gender identity is a type of gender discrimination, and therefore actionable under Title VII. The EEOC rejected this contention, and Macey appealed to the Commission.
On appeal, a unanimous Commission sided with Macey, grounding its decision in the Supreme Court's seminal opinion in Price Waterhouse v. Hopkins, 490 U.S. 228 (1990). The Commission reasoned that Title VII prohibits not just sex discrimination (that is, discrimination on the basis of biological sex), but any discrimination on the basis of gender stereotyping. In other words, the law prohibits employers from taking adverse employment actions against an individual because he or she fails to conform to any gender-based expectations or norms. Discrimination against a male who is presenting as a female, the Commission concluded, is just one type of discrimination that falls under sex discrimination. Thus, the Commission explained, whether the ATF decided not to hire Macey because they wanted a male and not a female, or because she was a biological man presenting as a female, her claims are actionable under Title VII and cannot be separated for investigation and adjudication.
In this new environment, transgender individuals will be able to file a charge with the EEOC and, if the Commission determines that the charge has merit, the agency could sue an employer under Title VII. The EEOC also may now issue a private right to sue to the charging party. It remains to be seen whether courts will agree with the EEOC's position.
EEOC Issues Updated Enforcement Guidance on Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII
On April 25, the EEOC issued updated enforcement guidance concerning employers' consideration of criminal arrest and conviction records when making hiring and other employment decisions. Approved by a 4-1 vote, the EEOC guidance states that, although Title VII does not bar the use of criminal background checks, employers may violate Title VII if (1) they intentionally discriminate, on the basis of race or national origin, against individuals with similar criminal histories or (2) their criminal background check policies have a disparate impact based on race or national origin, and they cannot demonstrate a "job-related business necessity" for those policies.
While the Commission maintains that the updated guidance does not reflect a change in its policies, but merely updates and consolidates existing EEOC policies and guidance on the subject, the new guidance demonstrates the Commission's new commitment to investigating and pursuing enforcement actions in criminal background check cases. The guidance also demonstrates the risks associated with the application of broad, across-the-board policies concerning the use of criminal background checks.
The updated guidance reinforces that employers may not intentionally discriminate, on the basis of race or national origin, against individuals with similar criminal histories. For example, an employer violates Title VII if it treats the criminal records of African American or Hispanic job applicants differently than the criminal records of white applicants.
Of greater concern to employers, the updated guidance explicitly states that "criminal record exclusions"—that is, excluding applicants based on their criminal records—have a disparate impact on race and national origin. Therefore, the practical impact of the guidance is that employers, in defending their use of criminal history, may be limited to proving that their use of criminal background checks is "job related and consistent with business necessity" in order to avoid Title VII liability; the new guidance suggests that the EEOC will no longer consider the question of whether there is in fact a disparate impact.
Rather than establishing a bright-line rule, the updated guidelines state that the use of arrest and conviction records is "job related and consistent with business necessity" in two broad situations: (1) when the employer validates its policy using the EEOC's Uniform Guidelines on Employee Selection Procedures, and (2) when the employer develops a targeted screen that considers the nature of the crime, the time elapsed since the commission of the crime, and the nature of the job for which an individual is applying. From a practical standpoint, employers that wish to consider criminal histories will need to inform individual applicants that they are being excluded on the basis of their criminal record, provide those applicants with an opportunity to explain their criminal records, and consider the explanations provided when deciding whether the use of the applicants' arrest and conviction records is, in fact, job related and consistent with business necessity.
Finally, while an employer may not be sued under Title VII for following a federal law or regulation that requires employers to consider applicants' criminal records, an employer may still face Title VII liability when it exceeds the requirements of federal law regarding the consideration of applicants' criminal records. Similarly, compliance with state or local laws requiring criminal background checks is not a shield from Title VII liability.
If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis attorneys: