Beware if your company has a policy that excludes all job applicants who have a criminal record. On January 29, 2013, the OFCCP issued Directive 306, titled “Complying with Nondiscrimination Provisions: Criminal Record Restrictions and Discrimination Based on Race and National Origin.” Directive 306 states that “[p]olicies that exclude people from employment based on the mere existence of a criminal history record, and that do not take into account the age and nature of an offense, … are likely to violate federal antidiscrimination law,” and it warns contractors to carefully consider their legal obligations before adopting such policies.

The directive indicates that the OFCCP will follow the Enforcement Guidance issued by the EEOC on April 25, 2012, which recommends a number of best practices to assist employers in avoiding liability for discrimination based on the use of criminal background checks in employment decisions. The EEOC’s recommended best practices can be found here, section VIII.

The directive also indicates that the OFCCP has adopted the Department of Labor's Employment and Training Administration and Civil Rights Center’s Training and Employment Guidance Letter (“TEGL”) 31-11, which was issued on May 25, 2012. The TEGL advises “covered entities” to conduct their activities using safeguards to prevent discrimination and to promote employment opportunities for formerly incarcerated individuals and other individuals with criminal records.

Finally, OFCCP Director Patricia Shiu posted on the agency’s website that Directive 306 discusses racial and ethnic disparities in U.S. incarceration rates, and she observed that blanket hiring exclusions against individuals with criminal records may have an impermissible disparate impact on those protected groups. Therefore, as a result of this directive, federal contractors and subcontractors should carefully review their hiring policies or practices that exclude applicants from employment based on their criminal history to ensure they will not violate their nondiscrimination obligations.

For more information, please contact a member of our Government Contracts practice group.