Presented by Edward C. Jepson, Jr. Vedder Price P.C. 222 North LaSalle Street Chicago, IL 60601

PESTSURE2012 AUTUMN LOSS PREVENTION MEETINGTHE EEOC GUIDELINES ON ARRESTSAND CONVICTIONS AND OTHER RECENT EEOC DEVELOPMENTS Presented by Edward C. Jepson, Jr. Vedder Price P.C. 222 North LaSalle Street Chicago, IL 60601 (312) 609-7582

I. INTRODUCTION • Growth in Prison Population • Disparate Impact • Increased Use/Availability of Background Checks • New EEOC Guidance Part of ERACE initiative

II. WHAT IS A GUIDANCE • The guidance is not the law • But EEOC will follow and courts likely to give deference

III. LAWS RESTRICTING USE OF ARREST AND CONVICTION INFORMATION • Title VII does not prohibit asking/using, per se • Many state laws, whether equal opportunity or others have set guidelines, prohibit or restrict the use of arrest and conviction information • The Fair Credit Reporting Act regulates the receipt and use of such information when it is generated by a third party consumer reporting agency. • Requires consent of employee or prospective employee • Requires disclosures of the legal obligations under the FCRA • If the decision is based on information in consumer report: • Notice to employee or candidate • Copy of report • Opportunity to contest • A Word about Credit Reports

IV. EEOC GUIDANCE • The 1987 policy statement and 1990 guidance provided that an employer should not have a blanket policy prohibiting the hiring of those convicted of crimes, but instead should consider what has been known as the Green factors: • Time since conviction • Nature of job • Nature of and gravity of offense • EEOCofficials state no real changes or minor changes -- understatement for employers • Big changes in disparate impact • In order to prove disparate impact • Prove there is a policy or practice • Prove disparate impact when applied to minorities • EEOCcites national statistics

IV. EEOC GUIDANCE • Employer proof of job-related and business necessity • No longer a simple consideration of the three Green factors • One option to validate under the uniform guideline/guidance says difficult and may prove costly • Another option, if federal law requires excluding applicants based on certain criminal records, it specifically states that such state restrictions are pre-empted. • Targeted screening • Targeted screening policy narrowly drafted with respect to job in question and offenses that are related • The three Green factors • Then an individualized assessment to determine if exception, which involves consideration of eight factors: • The facts or circumstances surrounding the offensive conduct • The number of offenses for which individual is convicted • The age at the time of conviction or released from prison • Evidence that the individual performed the same type of work post conviction with no known incidents

IV. EEOC GUIDANCE • Then an individualized assessment to determine if exception, which involves consideration of eight factors: (Cont’d) • The length and consistency of employment history before and after the conduct • Rehabilitation efforts • Employment or character references • Whether the individual has been bonded under a federal, state or local program • Increased costs to employer • Validation/expensive • Individualized assessment potentially expensive to conduct and may lead to disparate treatment claims • Arrests v. Convictions • Arrests usually not used except underlying conduct, maybe • Convictions usually good enough, but EEOC points that there may be errors in the process

V. PRACTICAL CONSIDERATIONS • All employers should review their policies and practices in light of the guidance and evaluate and revise as necessary • No blanket denial of employment should continue to be the rule • Large employers with high turnover are especially at risk • Big numbers lead to big damages • Employment applications – to ask or not? • Some states prohibit the question • EEOC says to only ask later in the process • If decide to ask as to convictions, make certain to state that this information will not necessarily deny employment, but would be taken on a case by case basis

V. PRACTICAL CONSIDERATIONS • No automatic disqualifications, except where required by federal law • Consider whether validation is possible • Develop a narrowly tailored policy with targeted screening and individual assessment, which includes review of the essential job factors and work convictions may be related • Training for Human Resources managers and employees

EEOC Litigation Regarding Leaves of Absence • Understanding your risk • Best practices for your workplace

High-Profile EEOC ADA Litigation • EEOC’s focus has been on employer policies or practices of: • “rigid” terminations at the end of LOA (even very extended leaves) • requiring “100% healed” before RTW • “no fault” attendance policies • EEOC will look behind the policy language at the practice • can the employer demonstrate that it was exploring reasonable accommodations in every case prior to termination? • has the interactive process been documented? • what reasonable accommodations were offered? Additional unpaid leave? Light duty? Transfer to an open position? Part time?

Challenges to DefendingEEOC Litigation • Pattern or Practice Litigation • very expensive and burdensome to defend • nationwide class and discovery • no class certification mechanism • Big ticket settlements • SuperValu: $3.2 M • Sears: $6.2 M • Verizon: $20 M (July 2011)

Best Practices in Light ofIncreased EEOC Scrutiny • Review and modify leave policies • Be mindful that leave might need to be extended even after job protection ends • Create a uniform plan for addressing return-to-work issues • consider an “accommodations team” (for consistency, re: interactive process) • train managers and HR team regarding the reasonable accommodation process • reach out in writing to each employee who is approaching the end of a specified leave of absence to begin the interactive process dialog

Best Practices in Light ofIncreased EEOC Scrutiny • Involve health care provider in dialog • provide a medical questionnaire and job description to HCP • closely manage the process and seek clarification if responses are vague or unclear • stay in close communication with your employee—goal is to jointly find a solution to facilitate return to work and performing essential job functions • Documentation is key • include every request for accommodation, every offer of accommodation and every response from employee • maintain up-to-date job description for every job: • accurately reflect essential functions • Include physical demands of the position

Retaliation Claims on the Rise • Fastest growing type of EEOC charge • Special Attention at EEOC

Retaliation Protections • Retaliation claims provide protection for employees who • exercise specific statutory rights (e.g., employment discrimination statutes), • engage in conduct that as a matter of public policy should not result in their termination or other adverse action, or • report violations of law by their employer

Retaliation: Proving a Claim • Protected activity (depends on source of claim) • EEO - Participation/opposition • Adverse Employment Act • Causal connection • Timing • Comments • Inconsistent treatment

Managing the Risk • Before an employee engages in protected activity: • Implement and train management on consistent treatment of employees • Have regular and candid performance reviews • Train managers on how and when to document, including performance reviews, coaching and corrective action • Employer policies • Every employer should have and disseminate a written policy prohibiting sexual, racial and other forms of discrimination and harassment and providing a flexible complaint mechanism for employees who feel they have been subject to discrimination, harassment or retaliation • Restrict disclosure of complaints of protected activity to a need-to-know basis • A manager who does not know of a protected complaint cannot retaliate for it

Managing the Risk • Employer policies • The policy should • Provide for complaints to be submitted to designated HR officials, or other management if the employee for any reason is not comfortable with submitting the complaint to the designated HR official(s) • Assure employees that they will not be retaliated against for presenting a good-faith claim • State that supervisors or others who do retaliate will face discipline, up to and including discharge • Require supervisors who observe possibly retaliatory conduct to report it • Call for prompt and thorough investigation and an appropriate report back to the complaining employee • Provide for appropriate remedial action • Restrict disclosure to a need-to-know basis

Managing the Risk • Employer policies • Many employers have instituted policies or procedures providing employee complaint mechanisms for subjects in addition to discrimination and harassment, in some cases for any grievance at all • Any such broader policy should have the same features mentioned above • In certain circumstances, for example, cases of alleged co-worker sexual harassment, the existence of policy may provide a defense to the underlying claim

Managing the Risk • Employer policies • Such policies: • By providing a forum to address employee complaints, may minimize the risk of a retaliation claim being made • Demonstrate employer willingness to receive claims and commitment not to retaliate • May help show employee’s claim not made in good faith if employee does not use procedure • Employer must be committed to and follow policy • Complaints and results should be documented

Managing the Risk • Employer policies • Review the policy with supervisors • Supervisors must understand employee’s right to engage in protected conduct • Supervisors must understand that they should report to HR any complaint made to them • Supervisors must understand their obligation not to retaliate and the consequences if they do

Managing the Risk • Once an employee has engaged in protected activity • The employee is not immune from further adverse personnel actions • Supervisors may not “crack down” on the employee • Further personnel actions should be carefully monitored until the matter related to the protected activity is resolved and for a period of time afterwards • Supervisors and others who may be the subject of the employee’s claims need to be counseled about their position, rights and responsibilities • Once an employee has engaged in protected activity • Employer must make certain that the protected employee is treated the same as a nonprotected employee in the same circumstances • Knowledge of the employee’s conduct should be restricted to the extent possible

Thank You. QUESTIONS?

Presented by Edward C. Jepson, Jr. Vedder Price P.C. 222 North LaSalle Street Chicago, IL 60601