As reported at the time, President Obama’s 2011 jobs bill included a proposal to prohibit discrimination on the basis of a job applicant’s status as unemployed. The proposal identified discrimination toward the long term unemployed as a contributing factor to the nation’s staggering unemployment statistics. In essence, the proposal would have made the unemployed a protected class in the same manner that race, religion and sex are now. Although the jobs bill has since languished, similar proposals are trending.
Whether discrimination towards the unemployed is a problem is debatable. Data suggesting the unemployed are subject to widespread and systematic discrimination is sparse. For instance, following a four week review of the job sites CareerBuilder.com, Indeed.com, Monster.com and Craigslist.com, researchers for the National Employment Law Project found only 150 ads listing employment status as a qualification1. Further, the reasons for the current median length of unemployment are, to say the least, complex. For instance, some argue that the length of unemployment is due to shifts in the inherent job finding abilities of the unemployed as a group2. Moreover, these proposals have come under fierce attacks, with one analyst for The Heritage Foundation calling the proposal in the jobs bill a “solution looking for a problem.”3
Inauspicious policy justifications aside, proposals to protect the unemployed poll well and are seen as non-monetary job growth initiatives As a result, similar proposals are being raised and enacted nationwide. New Jersey and Oregon have enacted statutes that prohibit employers from listing current employment as a qualification to apply. The District of Columbia went further with the enactment of The Unemployed Anti-Discrimination Act of 2012 (effective May 31, 2012), being the first jurisdiction to define the unemployed as a protected class and directing its Office of Human Rights to investigate and provide responses to claims of discrimination within one month of being notified of the alleged discriminatory act.
New York City is on the precipice of enacting a proposal that would go even further. Beyond prohibiting job postings listing employment status as a qualification, Bill 814-A, as recently passed by the New York City Counsel and believed to have enough support to override an anticipated veto by Mayor Bloomberg, will provide a private right of action against employers that discriminate against an applicant on the basis of his or her present or past employment status.
What does this mean?
Employers need to be proactive. Job posting literature must be reviewed and hiring personnel must ensure their scripts stay clear of prohibited questions. That’s the easy part. What is less easy, even after ensuring job postings are compliant and hiring personnel understand this emerging trend, is how to avoid an onslaught of frivolous discrimination claims from disappointed and disgruntled job seekers.
Recognizing that significant and legitimate reasons may exist for an employer to consider an applicant’s work history (termination for embezzlement comes to mind), Bill 814-A provides four exceptions to the general prohibition: First, an employer may inquire where there is a “substantially job-related reason for doing so,” as would be the case when a professional license is required. Second, the employer may give priority to the employer’s own current employees, i.e., unemployed applicants cannot claim priority given to an employer’s employees is a discriminatory practice. Third, an employer may tie compensation to prior work experience, which is logical and prevents wage differential discrimination claims on the basis of an employer merely paying experienced workers more. Fourth, and most interestingly, an employer may consider the “circumstances surrounding an application’s separation from prior employment.”
The last exception should give pause.
First, what if an employer does not consider the “circumstances” surrounding an applicant’s termination? By failing to inquire, the employer would appear to be at disadvantage when the unsuccessful applicant brings a subsequent discrimination claim citing his or her employment status a factor in the employer’s decision making.
Second, Bill 814-A offers no guidance as to what “circumstances” would permit the employer to claim safe harbor. For instance, what if an applicant was previously terminated for excessive leave, but the applicant says during his interview that his termination was wrongful and violated his right under the FMLA? Take it a step further, what if the employee says he is suing his former employer?
The interviewing employer would then be in the unenviable position of (a) having suspicions about the applicant’s prior abuse of leave, (b) weighing the applicant’s asserted rights under the FMLA, and (c) trying to make a hiring decision without getting sued. Employers will need to make careful assessments about what “circumstances” are sufficient to claim safe harbor. Soon these assessments will present ongoing difficulties for employers in New York City, and in a number of other jurisdictions around the country as well, until the courts and regulators offer meaningful guidance on the issue. Until then and for the foreseeable future, employers will need to work with counsel to develop best practices on a potentially case by case basis to ensure protection against future discrimination claims.
Robert Hellner co-authored this post.