Thursday, July 13, 2017

Hardie v. NCAA: Using Individualized Assessments to Screen Applicants with Criminal Records

The Ninth Circuit's decision in Hardie v. NCAA, No. 15-55576 (June 27, 2017), is an unusual case that looks at a criminal records screening policy in the context of a public accommodation, rather than in the more common employment context. This peculiarity highlights an issue that is not typically addressed, namely whether policies that make individualized assessments of the fitness of individuals with felony convictions are less discriminatory than blanket policies that exclude all individuals with criminal records. Individualized assessments are touted by the EEOC and civil rights advocates for their fundamental fairness, but little attention has been paid to whether they actually reduce discrimination.

Pursuant to the NCAA's Participant Approval Policy, anyone with a felony conviction is prohibited from coaching at an NCAA-certified nonscholastic youth athletic tournament. NCAA certification matters so much because coaches and recruiters from Division I schools are only permitted to attend tournaments that have NCAA certification. Dominic Hardie alleged that the Participant Approval Policy denied him a public accommodation in violation of Title II of the Civil Rights Act, which provides that "[a]ll persons shall be entitled to the full and equal enjoyment of the goods, services, facilities, privileges, advantages, and accommodations of any place of public accommodation . . . without discrimination on the ground of race, color, religion, or national origin." Hardie did not allege that the felony conviction policy constituted intentional discrimination (disparate treatment) in violation of the statute. Rather, he alleged that the policy constituted a disparate impact violation because it disproportionately excludes African Americans, who are more likely to have felony convictions than are whites, and the defendant could have instead adopted an alternative with less of a discriminatory impact.

The parties agreed that, assuming disparate impact claims are covered by Title II, the Supreme Court's decision in Wards Cove Packing Co. v. Atonio provides the governing framework: 1) the plaintiff must establish a prima facie case by showing that the challenged policy has a "significantly disparate impact" on a protected group, such as African Americans; 2) if the plaintiff establishes a prima facie case, the defendant must provide evidence that the practice serves legitimate goals in a significant way; and 3) even if the defendant has provided sufficient justification for the practice, the plaintiff can prevail by establishing that there is an alternative practice that is equally effective in advancing the defendant's interests while having less of a discriminatory impact on the protected group.

The parties did not seriously dispute the first two steps of this analysis. Hardie provided evidence that the criminal record policy excluded African Americans at a disproportionate rate, and the defendant did not contest the showing of disparate impact. The NCAA, in turn, contended that the policy serves its interest in "protecting the safety of the children who participate in the tournaments and the integrity of the NCAA's recruiting process and college athletics more generally." Hardie, "for the most part," accepted this rationale as legitimate, leaving only the question of whether there was a less discriminatory and equally effective alternative.

Hardie proposed two alternatives to the NCAA's felony conviction policy: a more limited policy of excluding only applicants with convictions for violent felonies or the use of individualized assessments to calculate the actual risks posed by applicants.

Because Hardie's conviction was for a nonviolent felony (drug possession), he would not have been excluded under the more limited policy he proposed. Rejecting this alternative, however, the court concluded that Hardie failed to show that it would be equally effective in promoting the NCAA's interests. Even if the increased risk of not excluding all felons was small, Hardie did not provide evidence that it was "immaterial to protecting the safety of young athletes." Nor was there evidence addressing the increased risk that the integrity of college athletics would be compromised by nonviolent crimes such as sports bribery.

In support of individual assessments as an alternative, Hardie's human resources expert, Lester Rosen, stated that individualized assessments may take into account factors such as "any mitigating circumstance about the offense, the age of the offense, . . . past employment, educational achievements since the offense, and other signs of rehabilitation." Hardie also pointed to the EEOC's recommendation that employers adopt individualized assessments to avoid liability when considering criminal records in the employment context.

The court rejected this second proposed alternative because Hardie had failed to provide evidence that the practice of making individualized assessments would be less discriminatory than the blanket policy. "Neither the Rosen report nor the EEOC Guidelines predict the racial effect of individualized assessments on the NCAA's applicant pool in particular. Without more, we cannot say that Hardie has met his burden to show that individualized assessments would be a less discriminatory alternative to the current Participant Approval Policy."

As the Hardie decision demonstrates, the question is not whether an alternative is fairer or excludes fewer individuals, but whether the difference between the rate at which African Americans are excluded and the rate at which whites are excluded is less under the alternative. For example, if a blanket conviction policy excludes 40 out of 100 African Americans and 40 out of 200 whites, then African Americans are excluded at double the rate of whites (40% vs. 20%). If an individualized assessment halves the exclusion rate for both groups, resulting in the exclusion of 20 out of 100 African Americans and 20 out of 200 whites, then blacks are still excluded at double the rate of whites (20% vs. 10%), so the latter policy is equally discriminatory. In order to be less discriminatory, the use of individualized assessments would have to disproportionately benefit African Americans

You might wonder, then, what basis does the EEOC have for recommending that employers use individualized assessments? The reason has to do with the difference between how disparate impact claims are analyzed under Title II and Title VII. Under the Wards Cove framework, which applies in Title II cases, a defendant can rebut a prima facie case by merely presenting evidence that a "challenged practice serves, in a significant way, the legitimate . . . goals of the [defendant]." By contrast, the EEOC states, in its Enforcement Guidance on Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII, that a practice challenged under Title VII must "bear a demonstrable relationship to successful performance of the jobs for which it was used" and "measure[] the person for the job and not the person in the abstract." The employer also must show that the policy is "necessary to safe and efficient job performance."

As should be obvious, the standards under Wards Cove and under Title VII are markedly different. A policy that advances legitimate goals in a significant way may not be "necessary to safe and efficient job performance" or measure a particular person's fitness for a particular job. The Wards Cove standard provides an entity with much more leeway in adopting a practice that has a disparate impact than does Title VII's business necessity standard. Moreover, under Title VII, the employer has the burden of proof in establishing that the challenged practice is an adequate predictor of an applicant's fitness. Under Title II, the plaintiff always bears the burden of proof, so the defendant is more likely to prevail in a Title II case than in a Title VII case when there is little evidence about the predictive value of a selection practice.

What I find most interesting about Hardie is that it illustrates a peculiarity about disparate impact analysis: a stringent requirement that a practice be justified by business necessity does not necessarily reduce discrimination and may actually have the opposite effect of promoting discrimination. Under EEO law, it is not unlawful to treat everyone badly in the same way. For example, if an employer doesn't give anyone vacation days, then that practice would not be discriminatory. On the other hand, if an employer gives African Americans 5 vacation days a year but whites 10 vacation days a year, everyone would be better off than under a no-vacation policy, but the practice would discriminate against African Americans.

A similar effect might arise from adoption of individualized assessments. As noted, there is no evidence that use of individualized assessments is less discriminatory than a blanket conviction policy. Indeed, there is good reason to suspect that the former actually might be more discriminatory since individualized assessments require subjective decisionmaking, which can be prone to stereotyping and unconscious bias. (Check out this episode of the podcast "Invisibilia.")
As a result, if a business necessity standard requires that an employer adopt individualized assessments, rather than a blanket conviction policy like the court upheld in Hardie, that requirement might very well result in more of a discriminatory impact.

But -- and this is a big but -- even if individualized assessments do not decrease the disparity between how blacks and whites are treated -- and potentially even increase the disparity -- there may be good reasons to prefer them to blanket policies. For one thing, they are likely to result in fewer individuals with felony convictions, both blacks and whites, being arbitrarily excluded. So even if white applicants with felony convictions benefit more from individualized assessments than do black applicants, a black applicant with a felony conviction is obviously better offer if an employer performs individualized assessments than if it excludes him out of hand. Moreover, because the use of individualized assessments benefits all applicants with criminal records, the practice can be seen as benefiting African Americans as a class more than it does whites as a class since a higher proportion of African Americans have a criminal record.

This blog reflects the views solely of its author. It is not intended, and should not be regarded, as legal advice on how to analyze any particular set of facts.