When it comes to conducting criminal background checks, employers have long been faced with a double-edged sword. If an employer fails to use criminal background checks to screen job applicants, the employer could face a negligent hiring or negligent supervision claim if the employee later engages in misconduct that harms a coworker or customer. On the other hand, the Equal Employment Opportunity Commission (“EEOC”) takes the position that using criminal background checks to screen job applicants has a disproportionate impact on minorities, and under some circumstances, could constitute race discrimination. As a result, employers must take care to ensure that they screen job applicants effectively without disproportionately impacting minority applicants. This dilemma is further complicated by the high unemployment rate in recent years, and the fact that job applicants with criminal records receive significantly fewer job offers than applicants without criminal records.
The Texas Legislature attempted to reconcile some of these competing interests by enacting Texas H.B. 1188, which became effective on June 14, 2103. The statute provides that “[a] cause of action may not be brought against an employer, general contractor, premises owner, or other third party solely for negligently hiring or failing to adequately supervise an employee, based on evidence that the employee has been convicted of an offense.” However, the statute has numerous exceptions and does not preclude all causes of action for negligent hiring or negligent supervision. Notably, an employer can still be liable for negligent hiring or supervision if the employer knew or should have known that the employee had been convicted of:
- an offense “that was committed while performing duties substantially similar to those reasonably expected to be performed in the employment, or under conditions substantially similar to those reasonably expected to be encountered in the employment”;
- a sexually violent offense;
- certain offenses identified in Article 42.12 of the Texas Code of Criminal Procedure, including but not limited to murder, indecency with a child, aggravated kidnapping, aggravated sexual assault, and aggravated robbery; or
- a crime involving fraud or misuse of funds or property in lawsuits concerning the misuse of funds or property.
Bottom line: Although the new statute prohibits causes of action based solely on an employee’s conviction for a criminal offense, there are still numerous criminal offenses that could lead to employer liability if the employer knew or should have known of the prior offense. Therefore, the statute should not be interpreted to suggest that employers can relax their screening procedures for job applicants. Employers should continue to conduct criminal background checks for job applicants to determine if there is a reasonable relationship between the applicant’s prospective job duties and the applicant’s criminal history. For more information regarding the use of employee background checks, please see the EEOC’s guidance at http://www.eeoc.gov/laws/guidance/arrest_conviction.cfm, and the guidance on the Fair Credit Reporting Act at http://www.consumer.ftc.gov/articles/0157-employment-background-checks.