Trathony Griffin and Michael Godwin, Appellants,v.Sirva, Inc. and Allied Van Lines, Inc., Respondents.BriefN.Y.March 28, 2017No. CTQ-2016-00002 To be argued by: PHILIP V. TISNE 10 minutes requested State of New York Court of Appeals TRATHONY GRIFFIN and MICHAEL GODWIN, Plaintiffs-Appellants, -against- SIRVA, INC. and ALLIED VAN LINES, INC., Defendants-Respondents. On the Certified Questions from the U.S. Court of Appeals for the Second Circuit in Docket No. 15-1307 BRIEF FOR AMICUS CURIAE THE STATE OF NEW YORK BARBARA D. UNDERWOOD Solicitor General STEVEN C. WU Deputy Solicitor General PHILIP V. TISNE Assistant Solicitor General of Counsel ERIC T. SCHNEIDERMAN Attorney General of the State of New York 120 Broadway New York, New York 10271 (212) 416-6073 (212) 416-8962 (facsimile) Dated: February 28, 2017 TABLE OF CONTENTS Page TABLE OF AUTHORITIES ............................................................ iii INTEREST OF AMICUS CURIAE .................................................. 1 QUESTIONS CERTIFIED TO THIS COURT................................. 2 STATEMENT OF THE CASE ......................................................... 3 A. Statutory Background ..................................................... 3 B. Factual Background ......................................................... 7 1. The contractual relationship between Sirva and Allied and their local agents ............................. 7 2. Allied’s policy against individuals with certain criminal convictions .................................................. 8 3. Plaintiffs’ employment with Astro and their termination ............................................................... 9 C. Procedural History ......................................................... 11 ARGUMENT .................................................................................. 13 POINT I EXECUTIVE LAW § 296(15) DOES NOT LIMIT LIABILITY TO AN AGGRIEVED PARTY’S DIRECT EMPLOYER ...................................... 13 A. The Text and Purpose of § 296(15) Support the Statute’s Application to Certain Non-Employers. ........ 14 ii TABLE OF CONTENTS (cont’d) Page B. The Reasons Proffered for Limiting the HRL’s Protections to Direct Employers Are Meritless. ............ 19 C. An Entity Other Than a Direct Employer May Be Liable for Discriminating Against Ex-Offenders When It Interferes with Their Employment or Establishes Discriminatory Terms and Conditions of Employment. .............................................................. 22 POINT II AN ENTITY OTHER THAN A DIRECT EMPLOYER MAY ALSO BE LIABLE FOR AIDING, ABETTING, INCITING, COMPELLING, OR COERCING A VIOLATION OF EXECUTIVE LAW § 296(15) ................ 28 A. “Aid” and “Abet” ............................................................. 29 B. “Incite, Compel or Coerce” ............................................. 35 CONCLUSION ............................................................................... 39 iii TABLE OF AUTHORITIES Cases Page(s) Arculeo v. On-Site Sales & Mktg., LLC, 425 F.3d 193 (2d Cir. 2005) ................................................. 22, 23 Argyle Realty Assocs. v. N.Y. State Div. of Human Rights, 65 A.D.3d 273 (2d Dep’t 2009) ................................................... 15 Ass’n of Mexican-Am. Educators v. State of California, 231 F.3d 572 (9th Cir. 2000) ...................................................... 26 Brankov v. Hazzard, 142 A.D.3d 445 (1st Dep’t 2016) ................................................ 15 Bristol v. Bd. of County Comm’rs of County of Clear Creek, 312 F.3d 1213 (10th Cir. 2002) .................................................. 23 City of Schenectady v. State Div. of Human Rights, 37 N.Y.2d 421 (1975) ................................................................... 4 Cmty. for Creative Non-Violence v. Reid, 490 U.S. 730 (1989) .................................................................... 14 Colo. Civil Rights Comm’n v. Travelers Ins. Co., 759 P.2d 1358 (Colo. 1988) ........................................................ 31 DiMucci Constr. Co. v. N.L.R.B., 24 F.3d 949 (7th Cir. 1994) ........................................................ 24 Forrest v. Jewish Guild for the Blind, 3 N.Y.3d 295 (2004) ....................................................... 33, 34, 38 Fox v. Commonwealth Worldwide Chauffeured Transp. of NY, LLC, 865 F. Supp. 2d 257 (E.D.N.Y. 2012) ........................................ 38 iv TABLE OF AUTHORITIES (cont’d) Cases Page(s) Frankel v. Bally, Inc., 987 F.2d 86 (2d Cir. 1993) ......................................................... 16 Garcia-Celestino v. Ruiz Harvesting, Inc., 843 F.3d 1276 (11th Cir. 2016) .................................................. 16 Gulino v. N.Y. State Educ. Dep’t, 460 F.3d 361 (2d Cir. 2006) ........................................... 16, 23, 26 Jews for Jesus, Inc. v. Jewish Cmty. Relations Council of N.Y., Inc., 79 N.Y.2d 227 (1992) ................................................................. 29 Jews for Jesus, Inc. v. Jewish Cmty. Relations Council of N.Y., Inc., 968 F.2d 286 (2d Cir. 1992) ....................................................... 35 Joseph v. Leavitt, 465 F.3d 87 (2d Cir. 2006) ......................................................... 38 Kern v. City of Rochester, 93 F.3d 38 (2d Cir. 1996) ........................................................... 27 Lopez v. Massachusetts, 588 F.3d 69 (1st Cir. 2009) ........................................................ 26 Margerum v. City of Buffalo, 24 N.Y.3d 721 (2015) ................................................................... 3 Matter of Acosta v. N.Y.C. Dep’t of Educ., 16 N.Y.3d 309 (2011) ....................................................... 7, 18, 37 Matter of Aurecchione v. N.Y. State Div. of Human Rights, 98 N.Y.2d 21 (2002) ................................................................... 38 v TABLE OF AUTHORITIES (cont’d) Cases Page(s) Matter of Bonacorsa v. Van Lindt, 71 N.Y.2d 605 (1988) ......................................................... 4, 6, 17 Matter of Nat’l Org. for Women v. State Div. of Human Rights, 34 N.Y.2d 416 (1974) ........................................................... 30, 33 Matter of Ovadia v. Office of Indus. Bd. of Appeals, 19 N.Y.3d 138 (2012) ........................................................... 24, 25 Matter of Pisano v. McKenna, 120 Misc. 2d 536 (Sup. Ct. Oneida County 1983) ....................... 5 N.Y. Inst. of Tech. v. State Div. of Human Rights, 40 N.Y.2d 316 (1976) ................................................................... 3 Nat’l Org. for Women v. Gannett Co., 40 A.D.2d 107 (4th Dep’t 1972) ................................................. 30 Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318 (1992) .................................................................... 16 Passaic Daily News v. Blair, 63 N.J. 474 (1973) ...................................................................... 30 Patrowich v. Chemical Bank, 63 N.Y.2d 541 (1984) ................................................................. 20 Redd v. Summers, 232 F.3d 933 (D.C. Cir. 2000) .................................................... 26 Salinas v. Commercial Interiors, Inc., No. 15-1915, 2017 WL 360542 (4th Cir. Jan. 25, 2017) .............................................................. 22 Sibley Mem’l Hosp. v. Wilson, 488 F.2d 1338 (D.C. Cir. 1973) ...................................... 18, 25, 27 vi TABLE OF AUTHORITIES (cont’d) Cases Page(s) Spirt v. Teachers Ins. & Annuity Ass’n, 691 F.2d 1054 (2d Cir. 1982) ..................................................... 26 State Div. of Human Rights v. GTE Corp., 109 A.D.2d 1082 (4th Dep’t 1985) ............................................. 15 Tarr v. Ciasulli, 181 N.J. 70 (2004) ................................................................ 31, 35 Tomka v. Seiler Corp., 66 F.3d 1295 (2d Cir. 1995) ....................................................... 33 Zheng v. Liberty Apparel Co. Inc., 355 F.3d 61 (2d Cir. 2003) ................................................... 16, 23 STATE STATUTES Ch. 118, 1945 N.Y. Laws 457 ......................................................... 28 Ch. 284, 2007 N.Y. Laws 2970, 2970 ............................................... 6 Correction Law § 750 ............................................................................................. 6 § 751 ........................................................................................... 21 § 752 ................................................................................... passim § 753 ................................................................................. 6, 21, 32 Executive Law §§ 290 et seq.................................................................................. 3 § 292 ............................................................................................. 5 § 296 ................................................................................... passim § 300 ....................................................................................... 3, 16 FEDERAL STATUTES 29 U.S.C. § 203 ............................................................................... 16 42 U.S.C. § 2000e-2 ........................................................................ 15 vii TABLE OF AUTHORITIES (cont’d) Miscellaneous Authorities Page(s) Assurance of Discontinuance, Matter of Cuomo v. ChoicePoint WorkPlace Solutions Inc., AOD No. 09-165 (Dec. 17, 2009) ................................................ 18 Dan B. Dobbs, et al., The Law of Torts § 435 (West 2d ed., 2016 update) ........................................................ 31 Mem. of Gov. Carey, reprinted in Bill Jacket for ch. 931 (1976) ......................................................................... 4 Mem. of N.Y. State Div. of Human Rights (July 29, 2007), reprinted in Bill Jacket for ch. 284 (2007) ....................... 6 Press Release, A.G. Schneiderman Announces Agreements With Background Check Agencies To End Illegal Hiring Practices (Mar. 13, 2014) ............................ 18 Report of the N.Y. State Temp. Comm’n Against Discrimination, Legis. Doc. No. 6 (1945) ................................... 29 U.S. Dep’t of Labor, Wage and Hour Division, Administrator’s Interpretation No. 2016-1 (Jan. 20, 2016), available at https://www.dol.gov/whd/flsa/ Joint_Employment_AIhtm ........................................................ 24 Webster’s Third New International Dictionary (1981) ................. 35 INTEREST OF AMICUS CURIAE The State of New York submits this amicus curiae brief to assist the Court in answering three questions of state law certified by the United States Court of Appeals for the Second Circuit. The questions ask whether, and in what circumstances, entities other than direct employers may be held liable for violating New York’s laws substantially restricting the denial of employment on the basis of prior criminal convictions. The State has a strong interest in establishing that certain non-employers may be held liable under these statutes. The Legislature has authorized both the Attorney General and the Division of Human Rights (DHR) to enforce New York’s antidiscrimination laws. And the State has enforced these laws against entities other than direct employers whose discriminatory policies or actions serve as a barrier to employment by individuals with prior convictions. Narrowing the scope of these statutes to direct employers alone would improperly limit their remedial effect and leave standing the obstacles to rehabilitation and reintegration that the Legislature intended to remove. 2 QUESTIONS CERTIFIED TO THIS COURT 1. Does § 296(15) of the New York State Human Rights Law, prohibiting discrimination in employment on the basis of a criminal conviction, limit liability to an aggrieved party’s “employer”? 2. If § 296(15) is limited to an aggrieved party’s “employer,” what is the scope of the term “employer” for these purposes, i.e., does it include an employer who is not the aggrieved party’s “direct employer,” but who, through an agency relationship or other means, exercises a significant level of control over the discrimination policies and practices of the aggrieved party’s “direct employer”? 3. Does § 296(6) of the New York State Human Rights Law, providing for aiding and abetting liability, apply to § 296(15) such that an out‐of‐state principal corporation that requires its New York State agent to discriminate in employment on the basis of a criminal conviction may be held liable for the employer’s violation of § 296(15)? This brief addresses only the first and third questions, explaining that entities other than direct employers may be held liable under Executive Law §§ 296(15) and (6). Because these 3 provisions are not limited to “employers,” this Court need not address the second question, and this brief does not discuss it. STATEMENT OF THE CASE A. Statutory Background In 1945, New York became the first State in the nation to enact an antidiscrimination law, which later became the Human Rights Law (HRL). See Executive Law §§ 290 et seq. Since the HRL’s enactment, the Legislature has repeatedly “expanded the law’s coverage to provide maximum protection to New Yorkers” from a broad range of invidious discrimination, Margerum v. City of Buffalo, 24 N.Y.3d 721, 734 (2015) (Rivera, J., concurring in part). In addition, to best fulfill the State’s “strong and important public policy against discrimination,” N.Y. Inst. of Tech. v. State Div. of Human Rights, 40 N.Y.2d 316, 324 (1976), the Legislature has directed that the HRL be “construed liberally,” Executive Law § 300. It is thus “the duty of courts to make sure that the Human Rights Law works and that the intent of the Legislature is not thwarted by a combination of strict construction of the statute and 4 a battle with semantics.” City of Schenectady v. State Div. of Human Rights, 37 N.Y.2d 421, 428 (1975). In 1976, the Legislature amended the HRL to prohibit discrimination in employment on the basis of a prior criminal conviction, and simultaneously enacted a parallel prohibition in the Correction Law that the HRL expressly incorporates.1 The Legislature enacted these provisions “to eliminate the effect of bias against ex-offenders which prevented them from obtaining employment.” Matter of Bonacorsa v. Van Lindt, 71 N.Y.2d 605, 611 (1988). Together, these provisions remove barriers to employment for ex-offenders in order to discourage recidivism and facilitate their successful reentry into the community. Mem. of Gov. Carey, reprinted in Bill Jacket for ch. 931 (1976). 1 The same provisions also prohibit discrimination in licensing. Because licensing is not at issue here, the statutory background focuses solely on the language relating to employment. 5 Executive Law § 296(15)2 thus provides that “[i]t shall be an unlawful discriminatory practice for any person, agency, bureau, corporation or association...to deny any...employment” to an individual by reason of his or her prior conviction, “when such denial is in violation of the provisions of article twenty-three-A of the correction law.”3 The cross-referenced Correction Law provisions in turn provide that no employment “shall be denied or acted upon adversely by reason of [an] individual’s having been previously convicted of one or more criminal offenses,” unless one of two exceptions is satisfied. Correction Law § 752.4 2 Pursuant to Rule 500.1(h), copies of the relevant statutes cited herein as well as publications that are not readily available are being submitted in an addendum, which is cited as “Add. __.” 3 Executive Law § 292(1) further defines “person” to include “one or more individuals, partnerships, associations, corporations, legal representatives, trustees, trustees in bankruptcy, or receivers.” 4 Correction Law § 752 originally referred only to the denial of an “application for...employment,” and courts began interpreting this language narrowly as not applying to discrimination against current employees. See, e.g., Matter of Pisano v. McKenna, 120 Misc. 2d 536, 537 (Sup. Ct. Oneida County 1983). In 2007, the Legislature amended the Correction Law to clarify that it applied not only to applications for employment, but also to “any...employment held by 6 The two exceptions outlined in the Correction Law (and incorporated by reference into the HRL) permit employment to be denied or adversely affected on the basis of a prior conviction when (1) there is a “direct relationship” between the conviction and the employment sought-i.e., the conviction “has a direct bearing on [an individual’s] fitness or ability to perform one or more of the duties or responsibilities necessarily related” to the employment in question, Correction Law §§ 750(3), 752(1); or (2) providing employment would involve an “unreasonable risk” to “the safety or welfare of specific individuals or the general public,” id. § 752(2). The Legislature has directed that employers “shall consider” eight factors in assessing whether either exception applies in any particular case. Id. § 753(1); see generally Matter of Bonacorsa, 71 any person”; as a result, the Correction Law is violated not only if an employment application is denied for discriminatory reasons, but also more broadly if any employment is “denied or acted upon adversely” on the basis of a prior conviction. Ch. 284, §§ 2-3, 2007 N.Y. Laws 2970, 2970 (codified at Correction Law §§ 751, 752). As the legislative history indicates, the result of this amendment was to align the Correction Law with the HRL’s parallel prohibition, which had never by its terms been limited to job applicants. See Mem. of N.Y. State Div. of Human Rights (July 29, 2007), reprinted in Bill Jacket for ch. 284, at 15 (2007). 7 N.Y.2d at 613-14. “A failure to take into consideration each of these factors results in a failure to comply with the Correction Law’s mandatory directive.” See Matter of Acosta v. N.Y.C. Dep’t of Educ., 16 N.Y.3d 309, 316 (2011). B. Factual Background 1. The contractual relationship between Sirva and Allied and their local agents Allied Van Lines, Inc. and its corporate parent, Sirva, provide interstate moving services to the public through local agents.5 (A94 [¶¶ 16-19].) Astro Moving and Storage Company, Inc. (“Astro”) is one of Allied’s local agents in New York. Approximately seventy to eighty percent of Astro’s business comes from Allied; the remaining business apparently represents Astro’s intrastate work. (A143.) (By contract, Astro is precluded from working for other motor carriers, with limited exceptions. (A180.)) The summary-judgment record does not contain a complete set of the documents defining the relationship between Allied and 5 This brief refers to Allied and Sirva collectively as “Allied.” 8 its agents. The available evidence, however, indicates that Allied was contractually authorized to exercise substantial control and direction over its agents’ activities. In particular, the record establishes that agents such as Astro commit to complying with “minimum standards of performance” and “quality” that are “prescribed” by Allied. (A162.) These standards extend to the conduct of the agents’ individual employees: for example, Allied dictates whether an agent’s employees may carry pets or firearms in their vehicles (A200). To ensure that agents comply with these standards, Allied requires agents to maintain records of their work for Allied (A163) and reserves the right to acquire its agents and operate their facilities and equipment in the event of “agent failures.” (A159.) 2. Allied’s policy against individuals with certain criminal convictions Allied largely relies on its agents’ employees to conduct its interstate moving business. In 2006, Allied established a “Certified Labor Program” that mandated that “individuals who conduct the business of Allied at [a] customer’s home or place of business” 9 (including employees of Allied’s agents) submit to a criminal background check conducted by a vendor of Allied’s choosing according to criteria that Allied alone established. (A198.) As relevant here, Allied’s rules categorically prohibit any individual from working for Allied if he or she has been convicted of a sexual offense (whether a misdemeanor or felony) or certain other serious offenses. (A203-204.) Allied polices compliance with the Certified Labor Program in a variety of ways, including by “conduct[ing] periodic audits” of its agents’ workforce. (A199.) Agents that violate the program by hiring prohibited individuals are subject to escalating monetary sanctions. (A199.) 3. Plaintiffs’ employment with Astro and their termination Astro hired plaintiffs Trathony Griffin and Michael Godwin in 2008 and 2010, respectively. (A92-93.) Plaintiffs worked on Allied jobs, and neither was ever disciplined for his work (A35, 37). Astro did not perform a background check before plaintiffs began their 10 employment (A45-46, 53-54), but at least one plaintiff (Griffin) disclosed that he had previously been convicted of a crime (A124). In 2011, several years after Allied instituted its Certified Labor Program, Astro required plaintiffs to submit to a background check after Allied “put pressure on [Astro] to get the things done.” (A54; see also A46.) The background checks revealed that Griffin had been convicted of child abuse and sexual misconduct in 1998, and that Godwin had been convicted of rape and sexual abuse in 1999. (See A92-93.) After learning that plaintiffs could no longer be certified to work on Allied jobs, Astro’s president terminated Godwin because he “couldn’t do anything else with him.” (A55.) Astro initially offered to retain Griffin to work on Astro’s non-Allied jobs even though such a reassignment would have reduced Griffin’s compensation “tremendously” (A52), but Griffin was later also terminated.6 6 The Second Circuit assumed for purposes of this appeal that Griffin had been terminated despite “some dispute” over whether he had instead voluntarily resigned. (A656.) 11 C. Procedural History Plaintiffs commenced this proceeding in the United States District Court for the Eastern District of New York against Astro, Sirva, and Allied. (A12.) The complaint asserted illegal discrimination claims under Executive Law § 296(15), as well as wage-and-hour claims under federal and state law. (A15-16.) On cross-motions for summary judgment, the district court (Brodie, J.) concluded that disputed issues of fact about plaintiffs’ termination precluded summary judgment on their HRL claim against Astro, their direct employer. (A353.) But the court dismissed plaintiffs’ HRL claims against Allied because it “had no employment relationship with Plaintiffs.” (A357.) The court concluded that Executive Law § 296(15) is limited to discrimination by an individual’s direct employer because only such an employer can “deny employment.” (A355.) The court further concluded that Allied was not liable under the “aiding and abetting” provision of Executive Law § 296(6) because it was not a “joint employer” with Astro, and because “at most,” its policy required plaintiffs to be reassigned to non-Allied 12 work, resulting only in “a change in [plaintiffs’] job responsibilities” rather than outright termination (A359.) On plaintiffs’ appeal, the Second Circuit discerned ambiguity in New York law and certified the three questions described above (supra at 2-3) to this Court regarding the liability of entities other than direct employers under Executive Law § 296(15). (A658.) While plaintiffs’ appeal relating to Allied was pending, plaintiffs tried their claims against Astro before a jury. The jury found in plaintiffs’ favor on some of their wage-and-hour claims, but found for Astro on plaintiffs’ claim under Executive Law § 296(15). (A361-365.) While the jury did not identify a specific basis for its rejection of the HRL claim, it had been instructed to find for Astro (i) on Griffin’s claim if Astro had not in fact terminated him; and (ii) on either plaintiff’s claim if the conviction had a “direct relationship” to the job at issue, or posed an “unreasonable risk” under Correction Law § 752. (A501-502.) Allied argued to the Second Circuit that the jury verdict in favor of Astro, the direct employer, should defeat plaintiffs’ HRL claims against Allied (A511-516), but the Second Circuit declined to 13 consider the verdict on appeal as a matter of federal procedure. (A664-665 (citing Lippi v. City Bank, 955 F.2d 599, 604 (9th Cir. 1992).) The court thus concluded that plaintiffs’ claims against Allied could not be resolved without clarification from this Court about the potential liability of entities other than direct employers. ARGUMENT POINT I EXECUTIVE LAW § 296(15) DOES NOT LIMIT LIABILITY TO AN AGGRIEVED PARTY’S DIRECT EMPLOYER Neither the text of Executive Law § 296(15) nor its broad remedial purpose supports limiting liability under that statute to an aggrieved party’s direct employer. To the contrary, § 296(15) extends not just to direct employers, but also to certain other entities whose discriminatory actions or policies directly influence employment decisions. 14 A. The Text and Purpose of § 296(15) Support the Statute’s Application to Certain Non-Employers. Neither the HRL nor the Correction Law (which the HRL incorporates) limits its provisions on conviction discrimination to direct employers alone-i.e., the entity that hires and compensates the aggrieved employee, and that thus has a master-servant relationship under common-law agency principles. See Cmty. for Creative Non-Violence v. Reid, 490 U.S. 730, 739-40 (1989). To the contrary, the HRL broadly forbids “any person, agency, bureau, corporation or association” from “deny[ing] any...employment” based on an individual’s criminal convictions. Executive Law § 296(15). And the parallel provisions of the Correction Law likewise provide that “no employment...shall be denied or acted upon adversely” because of a prior conviction, without limiting this prohibition to employers alone. Correction Law § 752. 15 Even HRL provisions that are by their terms limited to “employer[s]”7 have been consistently interpreted to extend beyond direct employers under certain circumstances in order to fulfill the remedial purposes of the HRL.8 A fortiori here, where the statute uses broader language, its language cannot reasonably be read to apply narrowly to direct employers. Federal courts confronting a similar question about the scope of federal statutes have likewise broadly construed antidiscrimination statutes that do not use the term “employer,” even when they strictly construe statutes that do use that term. For example, the Second Circuit has held that Title VII’s prohibition of race, sex, and other discrimination by “an employer,” 42 U.S.C. § 2000e-2(a), is limited to entities that have a “conventional master- servant relationship” with employees “as understood by common- 7 See, e.g., Executive Law § 296(1)(a) (“employer or licensing agency”), (1)(d) (“employer or employment agency”), (1)(e) (“employer, labor organization or employment agency”). 8 See, e.g., Brankov v. Hazzard, 142 A.D.3d 445, 445-46 (1st Dep’t 2016); Argyle Realty Assocs. v. N.Y. State Div. of Human Rights, 65 A.D.3d 273, 275 (2d Dep’t 2009); State Div. of Human Rights v. GTE Corp., 109 A.D.2d 1082, 1083 (4th Dep’t 1985). 16 law agency doctrine.” Gulino v. N.Y. State Educ. Dep’t, 460 F.3d 361, 371 (2d Cir. 2006) (quotation marks omitted); see also Frankel v. Bally, Inc., 987 F.2d 86, 90 (2d Cir. 1993) (same interpretation of “employee” in Age Discrimination in Employment Act). By contrast, both the Second Circuit and the Supreme Court have held that the Fair Labor Standard Act, which applies to all entities that “suffer or permit” an employee to work, 29 U.S.C. § 203(g), “necessarily reaches beyond traditional agency law” to cover certain non- employers. Zheng v. Liberty Apparel Co. Inc., 355 F.3d 61, 69 (2d Cir. 2003); see also Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 326 (1992); Garcia-Celestino v. Ruiz Harvesting, Inc., 843 F.3d 1276, 1287 (11th Cir. 2016) (same conclusion for immigration labor regulations). This reasoning supports the conclusion that Executive Law § 296(15) and Correction Law § 752 extend beyond direct, common-law employers, in light of the Legislature’s conscious choice to use not the term “employer” but rather “any person” who “den[ies]...employment.” Executive Law § 296(15). That broader interpretation is further supported by Executive Law § 300, which requires that the provisions of the HRL “be 17 construed liberally for the accomplishment of the purposes thereof.” The Legislature prohibited discrimination against individuals with criminal convictions “to eliminate the effect of bias against ex- offenders which prevented them from obtaining employment.” Matter of Bonacorsa, 71 N.Y.2d at 611. Here, significant policy interests support the application of these statutes to entities other than direct employers. As a practical matter, barriers to the employment of ex- offenders are not limited to the hiring and firing decisions of direct employers. As our own investigations and enforcement actions have demonstrated, entities other than direct employers play an increasingly important role in determining who obtains and retains employment, and their actions may be as substantial a barrier to employment as actions by direct employers. For example, background-check or credit-reporting agencies (which screen job applications on behalf of employers) have automatically disqualified job candidates with criminal histories and sent them 18 rejection letters-thus preventing such candidates from even getting their foot in the door of the hiring process.9 Holding such entities responsible for their discriminatory policies is critical to accomplishing the Legislature’s goal of achieving “‘the rehabilitation of those convicted’ and ‘the promotion of their successful and productive reentry and reintegration into society.’” Matter of Acosta, 16 N.Y.3d at 314 (quoting Penal Law § 1.05(6)). Particularly when these entities are the ones responsible for originating discriminatory policies, subjecting them to liability targets the true source of the discrimination and thus facilitates its effective eradication. By contrast, exempting such entities from the coverage of New York’s laws altogether would in effect “condone [the] continued use of the very criteria for employment that [the Legislature] has prohibited,” Sibley Mem’l Hosp. v. Wilson, 488 F.2d 1338, 1341 (D.C. Cir. 1973). 9 See, e.g., Press Release, A.G. Schneiderman Announces Agreements With Background Check Agencies To End Illegal Hiring Practices (Mar. 13, 2014) (Add. 33-34); Assurance of Discontinuance, Matter of Cuomo v. ChoicePoint WorkPlace Solutions Inc., AOD No. 09-165 (Dec. 17, 2009) (Add. 1-23). 19 B. The Reasons Proffered for Limiting the HRL’s Protections to Direct Employers Are Meritless. The district court and Allied offer several reasons to construe Executive Law § 296(15) and Correction Law § 752 as applying only to direct employers. None of their arguments has merit. First, the district court reasoned that only an employer can “deny employment.” (A355.) But that statement is simply not true: as explained more fully below (see infra Point I.C), the discriminatory actions of an entity other than a direct employer may in practice deny or adversely affect employment by interfering with an employment relationship or controlling the terms and conditions of employment. Second, the district court concluded that if Executive Law § 296(15) extends beyond direct employers at all, it applies at most to individuals who have (1) an “ownership interest in the [direct] employer,” or (2) “the power to do more than carry out personnel decisions made by others.” (A346 (quotation marks omitted).) But those two factors derive from a decision of this Court, Patrowich v. Chemical Bank, that addressed the distinct question of whether the 20 term “employer” extends to individual employees. See 63 N.Y.2d 541, 542 (1984) (per curiam). Patrowich’s holding has no application here, when the statutes in question are not expressly limited to “employers,” and the entities at issue are not individual employees. Third, Allied is mistaken in its view that the use of the word “employer” elsewhere in Executive Law § 296(15) and Correction Law article 23-A supports limiting the language at issue here to direct employers. To the contrary, as the Second Circuit noted, the Legislature’s use of the word “employer” in other parts of these laws only highlights the importance of respecting its choice of different language here (A672). Moreover, when the Legislature used the word “employer” elsewhere, it did so for particular and easily discernible reasons, and not in ways that created implications for the scope of the statutes as a whole. For instance, Allied points to the second sentence of § 296(15), which creates a rebuttable presumption against introducing an individual’s conviction into evidence in certain cases “alleging that the employer has been negligent in hiring or retaining an applicant or employee.” See Brief for 21 Respondents (“Br.”) at 21, 24-25. That evidentiary rule is sensibly limited to direct employers because it applies only to cases that are brought specifically against employers’ hiring and firing decisions. Allied also points to Correction Law § 753(1), which sets forth a series of factors that a “private employer shall consider” in making employment decisions on the basis of an individual’s prior conviction. See Br. at 22-23. But the Legislature’s requirement that direct employers engage in this individualized determination in no way suggests that other entities are exempt from these statutes. To the contrary, a direct employer’s obligation to engage in an individualized determination can only be achieved if other entities are forbidden from interfering with that process or establishing discriminatory terms and conditions of employment themselves.10 10 Amicus National Association of Professional Background Screeners errs in asserting (at 7-9) that Correction Law article 23- A as a whole is limited to direct employers. As amended in 2007 (see supra n.4), article 23-A applies to any “employment held by any person,” and provides that “no employment ...... shall be denied or acted upon adversely” on the basis of a prior conviction. Correction Law §§ 751, 752. Nothing in these provisions suggest that they are limited to direct employers alone, rather than extending to any entity that denies or adversely affects employment. 22 C. An Entity Other Than a Direct Employer May Be Liable for Discriminating Against Ex-Offenders When It Interferes with Their Employment or Establishes Discriminatory Terms and Conditions of Employment. Because the plain text of Executive Law § 296(15) and Correction Law § 752 is not strictly limited to employers, these provisions should be read to incorporate “recognized doctrines that enable an employee in certain circumstances to assert employer liability against an entity that is not formally his or her employer,” Arculeo v. On-Site Sales & Mktg., LLC, 425 F.3d 193, 197 (2d Cir. 2005).11 Two doctrines in particular are relevant to the facts of this case. First, an entity other than a direct employer may in practice deny or adversely affect employment in violation of New York law if it “share[s] or codetermine[s] the essential terms and conditions of a worker’s employment,” Salinas v. Commercial Interiors, Inc., No. 15-1915, 2017 WL 360542, at *8 (4th Cir. Jan. 25, 2017), and 11 While New York courts have also applied these doctrines to interpret the word “employer,” they are instructive in determining when an entity that is not a direct employer may be held responsible for denying or adversely affecting employment. 23 establishes a discriminatory policy against employing individuals with criminal convictions-even if the non-direct employer has no “formal right to control the physical performance of [the aggrieved employee’s] work,” Zheng, 355 F.3d at 69; see also Bristol v. Bd. of County Comm’rs of County of Clear Creek, 312 F.3d 1213, 1218 (10th Cir. 2002) (en banc). Courts have often imposed responsibility on such third parties under employment statutes by treating them as “joint employers” with the direct employer. See Arculeo, 425 F.3d at 197. Consistent with this case law, lower courts in New York have applied the joint-employer doctrine to extend the HRL (and other antidiscrimination statutes) to certain entities other than direct employers. See supra n.10. The joint-employer doctrine makes particular sense in this case because that doctrine has often been applied when, as here, a company does not hire its own employees, but rather contracts with a third party to supply its workforce.12 As courts have recognized, 12 See, e.g., Gulino, 460 F.3d at 378 (recognizing joint- employer status “where the plaintiff’s employment is subcontracted by one employer to another, formally distinct, entity”); Arculeo, 425 24 multiple factors may be relevant to determine whether the non- employer in this scenario should be deemed to be a joint employer, including whether the aggrieved employees “worked exclusively or predominantly” on behalf of the non-employer, whether the employees’ work was “integral” to the non-employer’s business, whether the employees use the non-employer’s “premises and equipment,” and whether the non-employer promulgated “work rules and conditions of employment” or issued “operating instructions” to the aggrieved employees. Matter of Ovadia v. Office of Indus. Bd. of Appeals, 19 N.Y.3d 138, 143-44 & n.4 (2012) (quoting Zheng, 355 F.3d at 72); see also DiMucci Constr. Co. v. N.L.R.B., 24 F.3d 949, 952 (7th Cir. 1994). Here, based on the summary-judgment record, some of these factors support joint-employer status, while others do not. On the one hand, the record suggests that Allied used its agents’ employees F.3d at 199 (“The clothing seller contracts with the temporary agency” for staff); U.S. Dep’t of Labor, Wage and Hour Division, Administrator’s Interpretation No. 2016-1, at 9 (Jan. 20, 2016) (describing joint employer’s arrangement with another “to provide it with labor and/or perform for it some employer functions.”). 25 to service Allied’s own customers (A198), and accordingly imposed detailed “standards of performance” on those employees (A162). Moreover, plaintiffs worked predominantly on behalf of Allied; that work was integral to Allied’s business; and Allied’s policy seems to have served in practice as a term or condition of plaintiffs’ employment. On the other hand, Allied has asserted (A524) that it has no direct control or functional supervision over Astro’s employees, see Matter of Ovadia, 19 N.Y.3d at 143, and the parties dispute the degree to which Allied interfered with its agents’ employment decisions, compare Br. at 2-3, with Brief for Appellants at 3-4. Further factual development would be warranted to resolve these disputes. Second, numerous federal courts have held that statutes prohibiting employment discrimination should extend to entities other than direct employers when their discriminatory actions interfere with an individual’s access to employment opportunities. These decisions illuminate the proper application of the HRL here. In the seminal case of Sibley Memorial Hospital v. Wilson, 488 F.2d 1338 (D.C. Cir. 1973), the D.C. Circuit held that federal 26 antidiscrimination laws should extend to a hospital that was an “intermediary” between employees and employers when the hospital “had used its control of access to potential employers”-in that case, private patients-“to deny [potential employees] significant employment opportunities” on the basis of gender. Redd v. Summers, 232 F.3d 933, 940-41 (D.C. Cir. 2000) (describing Sibley’s holding); see also Spirt v. Teachers Ins. & Annuity Ass’n, 691 F.2d 1054, 1063 (2d Cir. 1982) (same), vacated on other grounds, 463 U.S. 1223 (1983).13 As the D.C. Circuit recognized, third parties may effectively “deny...employment opportunities,” Redd, 232 F.3d at 941, if they 13 In Gulino, the Second Circuit declined to apply Sibley’s and Spirt’s interference theory to expand the scope of “employer” under Title VII to encompass a state agency that merely licensed employees. See 460 F.3d at 375. The federal courts are split on this question. Compare Ass’n of Mexican-Am. Educators v. State of California, 231 F.3d 572, 580-81 (9th Cir. 2000) (en banc) (adopting Sibley), with Lopez v. Massachusetts, 588 F.3d 69, 89 & n.17 (1st Cir. 2009) (rejecting Sibley). But neither Gulino nor this federal circuit split should be an obstacle to this Court’s adoption of the interference theory here. For the reasons discussed above (see supra Point I.A), the broader language of the HRL and the Correction Law, as well as Executive Law § 300’s rule of liberal construction, warrants applying the interference theory to the distinct statutory language at issue here. 27 have a concrete and immediate “nexus with the creation and continuance of direct employment relationships” and engage in discriminatory actions that adversely affect those relationships. Sibley, 488 F.2d at 1342. For example, a third party (like the hospital in Sibley) that controls some essential precondition to employment serves in practice as a gatekeeper to employment. Similarly, a third party may have the requisite nexus if an employer has “delegated any of its employment responsibilities” to the third party, Kern v. City of Rochester, 93 F.3d 38, 45 (2d Cir. 1996), such that the non-employer effectively carries out some part of the direct employer’s hiring and firing decisions. In these scenarios, a non- employer’s discriminatory actions will have a direct effect on employment because of the close connection between the non- employer and the employment process. Here, the summary-judgment record appears to raise a disputed issue of fact over whether Allied’s screening policy effectively interfered with plaintiffs’ employment opportunities. Some evidence suggests that Allied’s blanket refusal to accept individuals with certain criminal records served in practice as a 28 barrier to employment at Astro. Other evidence suggests that Astro was willing to continue employing at least one of the plaintiffs notwithstanding his inability to work on Allied jobs. Further factual development could resolve these disputes. POINT II AN ENTITY OTHER THAN A DIRECT EMPLOYER MAY ALSO BE LIABLE FOR AIDING, ABETTING, INCITING, COMPELLING, OR COERCING A VIOLATION OF EXECUTIVE LAW § 296(15) Executive Law § 296(6) makes it unlawful “for any person to aid, abet, incite, compel or coerce the doing” of any discrimination prohibited by the HRL. Pursuant to that provision, an entity other than a direct employer may be held liable if it requires its agent, the direct employer, to engage in illegal conviction discrimination. Section 296(6) was enacted in 1945 expressly to extend the HRL’s remedial scope to all those who assist or instigate illegal discrimination, even if they do not directly commit a prohibited discriminatory act. See Ch. 118, § 1, 1945 N.Y. Laws at 461. The State Temporary Commission Against Discrimination, which proposed adding § 296(6), explained that the provision was 29 “designed to bring within the orbit of the bill all persons, no matter what their status, who aid or abet any of the forbidden practices of discrimination or who attempt to do so,” as well as to provide protection for individuals “who find themselves subjected from any source to compulsion or coercion to adopt any forbidden employment practices.” Report of the N.Y. State Temp. Comm’n Against Discrimination, Legis. Doc. No. 6, at 31 (1945). While § 296(6)’s various labels for accessory liability substantially overlap, it will be helpful to analyze them independently for purposes of answering the certified question. See Jews for Jesus, Inc. v. Jewish Cmty. Relations Council of N.Y., Inc., 79 N.Y.2d 227, 233 (1992). A. “Aid” and “Abet” Executive Law § 296(6) makes it unlawful for “any person” to “aid” or “abet” prohibited discrimination. This Court has taken a broad view of aiding-and-abetting liability under the HRL. In Matter of National Organization for Women v. State Division of Human Rights (“NOW”), this Court held that a newspaper “aided and abetted sex discrimination” when it “published its want ads 30 under separate sex designations.” 34 N.Y.2d 416, 421 (1974). In so holding, the Court reversed a decision of the Fourth Department that had rejected aiding-and-abetting liability on the ground that there was no “knowledgeable and intentional participation” by the newspaper in any employer’s hiring and firing decisions. Nat’l Org. for Women v. Gannett Co., 40 A.D.2d 107, 116 (4th Dep’t 1972). This Court found it immaterial that the newspaper itself did not “directly perpetuat[e] [employment] discrimination due to sex”; it was enough that the newspaper’s advertisements “reinforce[d] the very discriminatory practices which the Federal and State antidiscrimination laws were meant to eliminate.” NOW, 34 N.Y.3d at 421-22; see also Passaic Daily News v. Blair, 63 N.J. 474, 488 (1973) (reaching same result due to “the prominent, if not indispensable place of newspaper classified advertising in the employment recruiting field”). NOW’s holding has been followed by subsequent decisions from other States adopting similar interpretations of essentially identical aiding-and-abetting provisions. Courts have thus “uniformly” rejected any requirement of “an intent to discriminate 31 by the aider or abettor.” Colo. Civil Rights Comm’n v. Travelers Ins. Co., 759 P.2d 1358, 1369-70 (Colo. 1988). Likewise, an individual need not have specific knowledge of the discriminatory act that he aids or abets; it is enough that he be “generally aware of his role as part of an overall illegal or tortious activity.” Tarr v. Ciasulli, 181 N.J. 70, 84 (2004) (quotation marks omitted). The individual also “need not participate” directly in a discriminatory practice “to be liable” for aiding and abetting it. Dan B. Dobbs, et al., The Law of Torts § 435 (West 2d ed., 2016 update). Rather, “[t]he conduct proscribed is simply conduct that assists others in their performance of prohibited acts.” Travelers, 759 P.2d at 1369. The summary-judgment record in this case could reasonably support a conclusion that Allied gave substantial assistance to unlawful discriminatory acts by Astro, while being at least generally aware of its role in employment discrimination. Allied devised the background-screening process and retained the background-check agencies that reported plaintiffs’ criminal convictions to Astro (A198; see also A47-48.) Allied also not only provided that information but also put “pressure” on its agents to 32 use the information to automatically disqualify individuals from employment on Allied jobs.14 (A54, 70-73.) Taken together, this evidence could support a finding that Allied provided substantial assistance to Astro’s discriminatory actions and was aware that this information would be used to make employment decisions on the basis of a criminal conviction. Indeed, the evidence suggests more strongly that Allied’s assistance was indispensable to Astro’s employment actions, that Allied was not just aware but actually intended agents such as Astro to use 14 Similarly, the Attorney General’s enforcement actions against background-check and credit-reporting agencies have targeted aiding-and-abetting conduct beyond the mere provision of criminal-background information to employers. Providing such information does not automatically aid or abet an unlawful discriminatory practice because New York law permits employers to consider prior convictions to determine whether a “direct relationship” or “unreasonable risk” would warrant denying or adversely affecting employment. See Correction Law §§ 752, 753(1). But the agencies targeted by the Attorney General did more than provide information: they also helped to carry out employers’ unlawful employment decisions by automatically disqualifying applicants, withdrawing offers of employment, or reporting applicants to be “disqualified” or “unqualified” based solely on past criminal convictions (Add. 6). Section 296(6) is reasonably read to prohibit supportive activities so closely tied to unlawful employment practices. 33 criminal-background information to make employment decisions, and that absent Allied’s intervention Astro would not have terminated plaintiffs or adversely affected their employment at all. There is thus a question of fact about whether Allied’s actions assisted and “reinforce[d] the very discriminatory practices” that the HRL was “meant to eliminate.” NOW, 34 N.Y.2d at 422. Allied argues that aiding-and-abetting liability under § 296(6) requires proof that they “‘actually participated’” in Astro’s alleged discrimination. Br. at 60-61. But this Court rejected any such requirement in NOW when it found aiding-and-abetting liability despite the fact that the newspaper did not directly participate in employment discrimination. See 34 N.Y.2d at 421-22. Moreover, while the Second Circuit and members of this Court have at times referred to actual participation as a prerequisite for aiding-and-abetting liability, see Forrest v. Jewish Guild for the Blind, 3 N.Y.3d 295, 328 (2004) (G.B. Smith, J., concurring); see Tomka v. Seiler Corp., 66 F.3d 1295, 1317 (2d Cir. 1995), they have done so only in the distinct situation where the aggrieved individual seeks to hold his or her fellow employees 34 responsible for aiding and abetting their employer’s discriminatory practices. As the Second Circuit correctly noted here, no similar rule has been applied “when the liability of a corporation that contracts with the employing corporate defendant is at issue” (A682). The appropriate standard under such circumstances is this Court’s holding in NOW. Allied also claims (Br. at 60-61) that it cannot be held responsible for aiding and abetting an unlawful discriminatory act when a jury has already concluded that Astro did not violate the HRL. To be sure, this Court has previously held that an aiding-and- abetting claim “cannot survive” if the plaintiff fails to establish any underlying unlawful discrimination. Forrest, 3 N.Y.3d at 314. In this proceeding, however, the Second Circuit has held that the jury verdict cannot be considered on the appeal. (A664-665.) This Court’s ruling on the availability of accessory liability thus remains relevant to a live controversy that the Second Circuit expects to resolve. 35 B. “Incite, Compel or Coerce” Executive Law § 296(6) makes it unlawful for “any person” to “incite, compel or coerce” discrimination. Collectively, these terms encompass any effort by a non-employer to instigate unlawful discrimination: to incite is “to move to a course of action”; to compel is to “force, drive [or] impel” to action; to coerce is to “compel to an act or choice by force, threat or other pressure.” See Webster’s Third New International Dictionary 439, 463, 1142 (1981); see also Tarr, 181 N.J. at 83 (similar definitions to New Jersey’s identical provision). This language covers a broad variety of actions by a non- employer. For example, this language would cover a group that uses “economic pressure and explicit threats” to induce a venue to cancel a contract with a religious group. See Jews for Jesus, Inc. v. Jewish Cmty. Relations Council of N.Y., Inc., 968 F.2d 286, 294 (2d Cir. 1992). Likewise, this language would extend to “an out-of-state principal corporation that requires its New York State agent to discriminate in employment on the basis of a criminal conviction” (A685 (emphasis added)), since such a requirement-especially one 36 backed up by the threat of contractual enforcement or deprivation of business-could induce a direct employer’s unlawful discrimination. There is no serious dispute here that Allied required its agents to pursue criminal-background checks of their employees and to use that information in making staffing decisions. Allied argues, however, that it did not require its agents to terminate any employees. Br. at 65-66. To the contrary, Allied asserts that agents were restricted only from assigning employees with disqualifying criminal convictions to Allied jobs (see A359-360). On this record, however, there remains a factual dispute about whether Allied’s policy in effect incited, compelled, or coerced its agents to terminate employees with certain criminal convictions. As noted above, Astro was contractually required to comply with Allied’s rules (A164-165), on pain of financial penalties (A199) or termination of the contract (A170). The record further indicates that the risk of such sanctions exerted considerable economic pressure on Astro, particularly because approximately seventy to eighty percent of Astro’s business was with Allied (A143). Indeed, 37 Astro’s president testified that he experienced “pressure” to comply with Allied’s policy (A54); that he “would probably get fined” if he did not (A49); and that he terminated at least one plaintiff (Griffin) because Astro “couldn’t do anything else with him” if he was disqualified from working on Allied jobs (A55). These facts suggest that Astro felt significant pressure to employ only individuals who satisfied Allied’s criminal-background policy. In any event, even if Allied’s criminal-background policy did not incite, compel, or coerce plaintiffs’ termination, the record here suggests that the policy induced at least two other prohibited discriminatory practices. First, the policy’s categorical disqualification of employees with certain criminal convictions (A203-205) appears to have led agents to violate the “mandatory directive,” Matter of Acosta, 16 N.Y.3d at 316, that they engage in an individualized evaluation of such employees before denying or adversely affecting employment. Second, even if Astro had retained plaintiffs, the policy would still have denied plaintiffs employment on Allied jobs, and thus substantially reduced their responsibilities and pay (A52). Such “a 38 decrease in wage or salary” and “significantly diminished material responsibilities” are regularly deemed to be “adverse employment action[s]” subject to liability under both state and federal antidiscrimination laws. Joseph v. Leavitt, 465 F.3d 87, 90 (2d Cir. 2006) (citations and quotation marks omitted); see Forrest, 3 N.Y.3d at 305 (recognizing “adverse employment action” as basis for liability under HRL).15 15 Some federal district courts have questioned whether an adverse employment action short of termination would trigger Executive Law § 296(15). See, e.g., Fox v. Commonwealth Worldwide Chauffeured Transp. of NY, LLC, 865 F. Supp. 2d 257, 270 (E.D.N.Y. 2012). But several factors support such a reading of the statute. The first is this Court’s general rule that the HRL should be read to target “the same type[s] of discrimination” as federal law, which unambiguously extends to adverse employment actions short of termination. Matter of Aurecchione v. N.Y. State Div. of Human Rights, 98 N.Y.2d 21, 26 (2002). The second is the express language in Correction Law § 752 prohibiting any employment from being “acted upon adversely.” While Executive Law § 296(15) does not contain the same language, it expressly incorporates the Correction Law, and, as discussed above (see supra n.4), the “acted upon adversely” language in Correction Law § 752 was added to bring that statute in line with the HRL. It would thus make little sense to construe these provisions differently when they were enacted and amended to operate in tandem. 39 CONCLUSION For the reasons explained above, an entity other than a direct employer may be liable for discriminating against an employee on the basis of a criminal conviction: (a) for its own direct participation in denying or adversely affecting employment under Executive Law § 296(15); or (b) for aiding, abetting, inciting, compelling, or coercing a denial or adverse effect on employment under Executive Law § 296(6). Dated: New York, NY February 28, 2017 BARBARA D. UNDERWOOD Solicitor General STEVEN C. WU Deputy Solicitor General PHILIP V. TISNE Assistant Solicitor General of Counsel Respectfully submitted, ERIC T. SCHNEIDERMAN Attorney General of the State of New York Attorney for Amicus Curiae By: ________________________ PHILIP V. TISNE Assistant Solicitor General 120 Broadway New York, NY 10271 (212) 416-6073 Reproduced on Recycled Paper AFFIRMATION OF COMPLIANCE Pursuant to the Rules of Practice of the New York Court of Appeals (22 N.Y.C.R.R.) § 500.13(c)(1), Philip V. Tisne, an attorney in the Office of the Attorney General of the State of New York, hereby affirms that according to the word count feature of the word processing program used to prepare this brief, the brief contains 6,960 words, which complies with the limitations stated in § 500.13(c)(1). ______________________________ Philip V. Tisne Addendum TABLE OF CONTENTS PAGE Assurance of Discontinuance, Matter of Cuomo v. ChoicePoint Workplace Solutions Inc., AOD No. 09-165 (Dec. 17, 2009) ...................... ADD1 First Advantage, Letter Agreement (Aug. 19, 2013) ............................... ADD24 Sterling Infosystems, Letter Agreement (Nov. 25, 2013) ........................ ADD26 General Information Services, Inc., Letter Agreement (Mar. 3, 2014) ............................................................................................. ADD28 HireRight, Inc., Letter Agreement (Mar. 5, 2014) ................................... ADD31 N.Y. State Office of the Attorney General, Press Release, A.G. Schneiderman Announces Agreements With Background Check Agencies To End Illegal Hiring Practices (Mar. 13, 2014) ...................... ADD33 Executive Law § 296, excerpts .................................................................. ADD35 Correction Law § 752 ................................................................................. ADD36 Correction Law § 753 ................................................................................. ADD37 ADD1 OFFICE OF THE ATTORNEY GENERAL OF THE STATE OF NEW YORK CIVIL RIGHTS BUREAU IN THE MATTER OF THE INVESTIGATION OF ANDREW M. CUOMO, ATTORNEY GENERAL OF THE STATE OF NEW YORK, OF CHOICEPOTI~T WORKPLACE SOLUTIONS INC.; CHOICEPOINT PRECISION MARKETING LLC; CHOICEPOINT PUBLIC RECORDS INC.; and CHOICEPOINT SERVICES INC. AOD No. 09-165 ASSURANCE OF DISCONTINUANCE In April 2009, the Office of Attorney General ofthe State ofNew York ("OAG") began to investigate, pursuant to New York Executive Law § 63(12), certain practices of ChoicePoint WorkPlace Solutions Inc., a consumer reporting agency held by ChoicePoint Inc. that provides services to employers relating to background checks that employers use when hiring applicants in New York State, as well as ChoicePoint Precision Marketing LLC, ChoicePoint Public Records Inc., and ChoicePoint Services Inc. Specifically, the OAG investigated whether ChoicePoint, in violation of the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq.; New York State General Business Law§§ 380 et seq.; New York State Executive Law§ 63(12); New York Executive Law§§ 296(6), (15) and (16); New York Correction Law§§ 752-53; and New York City Administrative Code § 8-1 07(1 0), unlawfully aided and abetted employers in New York State who exclude and/or excluded applicants from consideration for employment (1) based upon information that that could not be lawfully considered for employment purposes; and (2) without considering a number of factors required by New York Correction Law§§ 752-53. ADD2 This Assurance of Discontinuance ("Assurance") contains the OAG's Findings in connection with its investigation of ChoicePoint and the relief agreed to by the OAG and ChoicePoint ("the parties"). DEFINITIONS 1. As used throughout this Assurance, the terms set forth below shall mean as follows: a. "Applicant" means any person residing in New York State and applying or considered for employment or promotion, or a person who ChoicePoint can, based on information provided by its client, reasonably determine has been provided a conditional offer of employment in New York State, conditioned on a background check, by a ChoicePoint client. b. "Adjudication" or "adjudication matrix" means the background check standards prepared by clients and by which ChoicePoint determines whether an applicant meets or does not meet client hiring standards, as well as sample adjudication matrices provided by ChoicePoint to clients. c. "Adjudication services" means the service offered by ChoicePoint to its clients pursuant to which ChoicePoint compares the results of a consumer report against the client's hiring standards set forth in an adjudication matrix to determine whether an applicant meets or does not meet the client's hiring standards. d. "Adjournment in Contemplation of Dismissal" or "ACD" is a disposition in New York State that automatically dismisses the charge within six months to one year of the disposition date, unless the matter is restored to the calendar by the court upon application by the prosecuting agency pursuant to New York Criminal Procedure Law § 170.55. 2 ADD3 e. "Affiliates" means any entities controlled by or controlling ChokePoint that are, or during the term of this Assurance become, engaged in the business of employment-related background checks. f. "Assurance" means this Assurance of Discontinuance. g. "Background check" means any inquiry by ChoicePoint regarding an applicant's background that bears upon the applicant's character or fitness for employment, including but not limited to credit and criminal record history, and which is regulated by, inter alia, the Fair Credit Reporting Act, 15 U.S.C. §1681 et seq., and New York State General Business Law § 380 et seq. h. "ChoicePoint" means ChoicePoint WorkPlace Solutions Inc. and all of its owners, executives, officers, directors, managers, representatives, subsidiaries, affiliates, employees and all individuals and agents who act on their behalf, and also includes, to the extent that any of them now are or during the term of this Assurance become engaged in the business of employment-related background checks, ChoicePoint Precision Marketing LLC, ChokePoint Public Records Inc., and ChoicePoint Services Inc. and any oftheir owners, executives, officers, directors, managers, representatives, subsidiaries, affiliates, employees and all individuals and agents who act on their behalf. 1. "Client" means a person or entity that utilizes the services of ChoicePoint in its processes or procedures for hiring applicants, conditional employees and/or employees in New York State. J. "Client documents" means (a) any statement of legal requirements, sample and client adjudication matrices, service contracts, user guides and training manuals; 3 ADD4 (b) criminal record reports; and (c) documents concerning adjudication and pre- screening of applicants, provided by ChoicePoint to clients. k. "Consumer report" means a consumer report as defined in the Federal Fair Credit Reporting Act. I. "Criminal record history" means all information relating to arrests, criminal instruments, charges, accusations, and dispositions thereof. m. "Criminal record report" means a document prepared by ChoicePoint for a client that provides the criminal record history of an applicant. n. "Dismissed or sealed conviction" means any criminal background history relating to a disposition that has been dismissed or sealed, including but not limited to a violation, an adjournment in contemplation of dismissal after entry of dismissal, and a youthful offender adjudication. o. "Disqualify" and "disqualification" means that the criminal record history of an applicant makes that applicant ineligible for employment by a ChoicePoint client in New York State. p. "Effective Date" means the date this Assurance is executed by the parties hereto. q. "Employee" means any person performing work for and compensated by ChoicePoint who has responsibilities related to clients. r. "Policies" means policies, practices and procedures, both formal and informal, with respect to ChoicePoint background checks, and pre-screening and adjudication services provided to clients for employment purposes in New York State. 4 ADD5 s. "Pre-screen" or "pre-screening service" means any system that is designed to disqualify an applicant based upon the applicant's response to questions regarding the applicant's criminal background history. t. "Subsidiaries" means any entities controlled by ChoicePoint that are, or during the term of this Assurance become, engaged in the business of employment- related background checks. u. "Violation" means any offense categorized as a violation under the New York Penal Law, which is usually sealed pursuant to New York Criminal Procedure Law§ 160.55. v. Terms of construction: (i) "And" and "or" shall be construed conjunctively or disjunctively as necessary to make the meaning inclusive rather than exclusive. (ii) "All" means "any and all" and "any" means "any and all." (iii) "Concerning" means relating to, referring to, describing, evidencing, regarding, reflecting or constituting. (iv) "Including" means without limitation. (v) The use of the singular form of any word includes the plural and vice versa. (vi) "Day" refers to a calendar day, not a business day. 5 ADD6 FINDINGS 2. ChoicePoint is one of the largest credit reporting agencies in the country, with over a thousand clients in New York State. Through its service agreements, ChoicePoint provides its clients with consumer reports for job applicants and, in certain circumstances, adjudication and/or pre-screening services. 3. Beginning in April 2009, the OAG launched an investigation of ChoicePoint based on evidence that (a) ChoicePoint was involved in the creation of an online application system for a client that automatically disqualified thousands of applicants in New York State because of a self-disclosed criminal record history, and (b) a ChoicePoint client withdrew conditional offers of employment to over one hundred applicants where a background check revealed sealed and dismissed convictions, including violations and ACDs over one year old, in violation of New York Executive Law §§ 296(15) and (16) and New York Correction Law§§ 752-53. 4. The investigation also revealed that ChoicePoint provided services that directly or indirectly assisted in these unlawful employment practices by, among other things, designing and implementing the scoring system that (a) automatically terminated applicants who disclosed a criminal record history and (b) disqualified applicants based on violations and ACDs that were over one year old. 5. The investigation also revealed that ChoicePoint provides clients with a sample adjudication matrix that calls for the disqualification of applicants based upon dispositions that are violations in New York State, and administers adjudication services for at least twenty other clients in New York State that call for the exclusion of applicants based upon a violation, dismissed charges or sealed convictions. 6 ADD7 PROSPECTIVE RELIEF WHEREAS, the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. §§ 1681 et seq., New York Executive Law§§ 296(6), (15) and (16), New York Correction Law§§ 752-53, New York General Business Law §§ 380 et seq., and New York City Administrative Code § 8-107(10) require, inter alia, that (l) credit reporting agencies follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom a criminal record report relates; (2) refrain from reporting non-pending arrests, criminal instruments, charges and accusations that did not result in a criminal conviction; and (3) not aid or abet employers that consider non-pending arrests terminated in favor of the individual and/or resulting in a dismissed or sealed conviction, such as ACDs after entry of dismissal and youthful offender adjudications, or most violations, or that automatically exclude applicants with a criminal record history without considering the nature and gravity of the conviction and its bearing, if any, on any specific responsibilities of the job sought, the time that elapsed since the conviction, the age of the applicant when the offense was committed, and any evidence of rehabilitation. WHEREAS, the OAG's investigation involved reviewing documents, including those produced by ChoicePoint pursuant to subpoena duces tecum, that showed pertinent policies, procedures and practices of ChoicePoint; taking sworn testimony of ChoicePoint personnel pursuant to subpoena ad testificandum; interviewing complainants; and analyzing complaints, adjudication matrices and other relevant data regarding ChoicePoint' s pre-screening, adjudication, and background check services for clients in New York State; WHEREAS, ChoicePoint neither admits nor denies the OAG's Findings 2- 5; 7 ADD8 WHEREAS, the OAG is willing to accept the terms of this Assurance pursuant to New York Executive Law § 63(15) and to discontinue its investigation of ChoicePoint Workplace Solutions Inc., ChoicePoint Precision Marketing LLC, ChoicePoint Public Records Inc., and ChoicePoint Services Inc.; and WHEREAS, the parties believe that the obligations imposed by this Assurance are prudent and appropriate; IT IS HEREBY UNDERSTOOD AND AGREED, by and between ChoicePoint and the OAG, as follows: Compliance with Federal, State and Local Law 6. ChoicePoint agrees to comply fully with the obligations, terms, and conditions of Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq.; FCRA, 15 U.S.C. §§ 1681 et seq.; New York State General Business Law§§ 380 et seq.; New York State Executive Law§ 63(12); New York Executive Law§§ 296(1), (6), (15) and (16); New York Correction Law§§ 752-53; and New York City Administrative Code§ 8-107(10). Specifically, ChoicePoint will: a. Instruct clients regarding the federal, state and local privacy and anti- discrimination law requirements that relate to the use of criminal background reports, adjudication services, and pre-screening services, including but not limited to Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq.; FCRA, 15 U.S.C. §§ 1681 et seq.; New York State General Business Law§§ 380 et seq.; New York Labor Law§ 201-f; New York Executive Law§§ 296(1), (15) and (16); New York Correction Law§§ 752-53; and New York City Administrative Code§ 8-107(10); in 8 ADD9 each case, such instruction obligation shall be fully satisfied through delivery of a written notice to clients, which shall be submitted to the OAG within sixty (60) days for comment and approval prior to issuance; b. Obtain a written certification from clients in substantially the following form, which shall be attached to or incorporated within the service contract: "Customer shall comply with all relevant privacy and anti- discrimination laws in using any information provided by ChoicePoint. Any adjudication matrix or pre-screening instructions that Customer has provided to ChoicePoint for use in adjudicating background reports or implementing a pre-screening service in New York State has been reviewed by Customer's legal counsel and complies with federal, state, and local privacy and anti-discrimination laws, including but not limited to Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq.; New York State General Business Law §§ 380 et seq.; New York Executive Law §§ 296(1 ), (15) and (16); New York Correction Law §§ 752-53; and New York City Administrative Code § 8-1 07( 1 0);" c. Refrain from providing a pre-screening service for clients that is designed to disqualify an applicant based upon the applicant's response to questions regarding the applicant's criminal record history in violation of New York Executive Law§§ 296(1), (15) or (16); New York Correction Law§§ 752- 53; or New York City Administrative Code § 8-107(10), in New York State; 9 ADD10 d. Refrain from providing to its clients any criminal record history obtained from a court or agency in New York State classified as a conviction for a violation relating to an applicant, as evidenced by the classification given to such record by the court from which such record was obtained, provided that ChoicePoint may disclose any disposition that: (a) is required to be obtained by the client pursuant to applicable law; or (b) does not otherwise violate federal, state and local privacy and anti- discrimination laws; e. Refrain from maintaining or reporting records of ACDs after entry of dismissal and youthful offender adjudications of applicants obtained from a court or agency in New York State; and f. Follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom a criminal record report relates in compliance with established law and this Assurance. 7. Provided that should any of the above laws be subject to amendment by the New York State legislature or binding decision by the New York Court of Appeals after the Effective Date but before the expiration of this Assurance, which materially changes ChoicePoint's legal compliance obligations, and upon notice to the other party, the parties agree to discuss a reasonable amendment to paragraph six (6) in accordance with the amendment or decision, and such amendment shall not be unreasonably denied. 10 ADD11 Policy Revisions to Comply with Law 8. ChoicePoint agrees to develop and submit within sixty (60) days from the Effective Date to the OAG for its comment and approval, which shall not be unreasonably denied: a. Revised policies and procedures relating to how ChoicePoint obtains and reports the background history of applicants in New York State in compliance with federal, state and local law as outlined in paragraphs six ( 6) and seven (7) of this Assurance, including but not limited to refraining from maintaining or reporting convictions for violations, ACDs after entry of dismissal and youthful offender adjudications; and b. Revised client documents in compliance with paragraphs six (6) and seven (7) of this Assurance, including but not limited to information regarding legal requirements, sample adjudication matrices, service contracts, written certifications, user manuals and trainings. Once approved, ChoicePoint shall adhere to such policies and provide a copy of such client documents to personnel who are responsible for compliance with such policies, and shall not make material changes thereto during the duration of this Assurance without prior written approval by the OAG. 11 ADD12 Training 9. ChoicePoint agrees to provide within thirty (30) days from the Effective Date a copy of this Assurance to all employees responsible for revising ChoicePoint policies as required by this Assurance. 10. ChoicePoint agrees to develop and submit within sixty (60) days from the Effective Date to the OAG for its comment and approval, which shall not be unreasonably denied, a training program to instruct all employees responsible for providing adjudication or pre-screening services for clients in New York State, or for preparing background reports regarding applicants in New York State on the requirements of the policies described in this Assurance and applicable law. ChoicePoint agrees to require that these employees complete this training within forty-five (45) days of OAG approval, and thereafter within ninety (90) days of hire, and again once every two years after the hire date. 11. ChoicePoint agrees to require that all employees who receive a copy of the Assurance pursuant to paragraph nine (9) sign an acknowledgment of receipt in the form of Exhibit A, and that all employees who attend the required training program pursuant to paragraph ten (1 0) sign an acknowledgement of attendance in the form of Exhibit B. 12 ADD13 Record-Keeping I 2. ChoicePoint agrees, unless legally prohibited from doing so or pursuant to a mandatory agreement with a state agency or its agent, to create and maintain the following records for the duration of this Assurance: a. All client documents that relate to paragraphs six (6), seven (7), and eight (8) of this Assurance; b. All criminal record reports of applicants; c. All applicant complaints in New York State, including but not limited to complaints regarding the pre-screening, reporting or adjudication of applicants based upon violations or dismissed or sealed convictions; d. ChoicePoint's policies and procedures for collecting, maintaining, and reporting the criminal record histories of applicants in New York State; and e. All notices, executed training materials and acknowledgment forms required to be posted, conducted and/or executed under paragraphs nine (9) through eleven (II). Reporting 13. ChoicePoint agrees within sixty (60) days of OAG approval of ChoicePoint's revised policies and every six (6) months thereafter for the duration of this Assurance to prepare and submit a report to the OAG, which shall contain: a. A certification that ChoicePoint has complied with and has not changed in any material respect its policies related to paragraphs six (6) through twelve (12) of this Assurance during the previous six months, or if ChoicePoint is unable to 13 ADD14 provide this certification, an explanation of such non-compliance or revision and any attempts to cure such non-compliance; b. All documents related to any complaint by an applicant during the previous six months concerning the pre-screening or adjudication of, and the reporting of records relating to, applicants based upon violations or dismissed or sealed convictions obtained from a court or agency in New York State, including but not limited to: 1. Any report prepared by ChoicePoint regarding the applicant to a client; ii. Any record of the complaint, including but not limited to the dispute log entry; and iii. All documents concerning the investigation by and resolution of the complaint by ChoicePoint. Provided, however, that in reporting applicant dispute information ChoicePoint shall not be required to report information that would violate FCRA, 15 U.S.C. §§ 1681 et seq. c. Any training acknowledgments executed in the previous six months pursuant to paragraph eleven ( 11) of this Assurance. 14 ADD15 Independent Consultant 14. Within sixty (60) days of the Effective Date, ChoicePoint will engage at its own cost an Independent Consultant ("Consultant"), an independent third-party with expertise in the collection, maintenance and reporting of criminal record histories from public sources, to evaluate ChoicePoint's compliance with subparagraphs 6.d and 6.e of this Assurance. The selection of the Consultant shall be subject to the OAG's approval, which shall not be unreasonably withheld. a. Within 120 days of the Effective Date, the Consultant shall provide to the OAG a written plan ("Plan") reflecting the processes and procedures that the Consultant will follow to evaluate compliance with subparagraphs 6.d and 6.e of this Assurance and to report such compliance or non-compliance to the OAG within six months of the Effective Date ("Report"). The Plan shall be subject to the OAG's approval, which shall not be unreasonably withheld. Upon the OAG's approval, the Consultant shall implement the processes and procedures set forth in the Plan. b. The Plan shall include a description of her or his review of the maintenance and reporting of criminal background history information, to determine whether ChoicePoint has complied with subparagraphs 6.d and 6.e of this Assurance; c. As part of the review process, the Consultant shall inspect any documents maintained by ChoicePoint and interview any ChoicePoint employees necessary to determine whether ChoicePoint has complied with subparagraphs 6.d and 6.e of this Assurance, and ChoicePoint agrees not to unreasonably deny access to any such witnesses or documents; and 15 ADD16 d. The Consultant shall prepare the Report and provide it to the OAG within thirty (30) days ofOAG approval ofthe Plan. The report shall include: i. A description of the methodologies used by the Consultant to assess ChoicePoint's compliance with subparagraphs 6.d and 6.e of this Assurance; 11. A detailed description of the implementation of each step set forth in the Plan; 111. A brief summary of the revisions made by ChoicePoint in its collection, maintenance, and reporting of criminal record histories to comply with this Assurance; and iv. The Consultant's conclusion as to whether ChoicePoint has complied with subparagraphs 6.d and 6.e of this Assurance. 15. If ChoicePoint materially revises the policies identified in subparagraphs 6.d and 6.e of this Assurance after the Report, ChoicePoint agrees to inform OAG within thirty (30) days of the revision and engage at its own cost the Consultant for her or his supplemental review of any such revisions to determine whether they comply with subparagraphs 6.d and 6.e of this Assurance. The Consultant shall provide the supplemental Consultant's report to OAG ("Supplemental Report"), which shall follow the processes and procedures as described in the Plan, within thirty (30) days of such engagement by ChoicePoint. 16. Should a review of the documents produced by ChoicePoint provide the Consultant with a good faith belief that ChoicePoint has materially violated any term in subparagraphs 6.d and 6.e of this Assurance relating to the maintenance and reporting of criminal record histories in New York State, the Consultant shall notify the OAG and ChoicePoint of 16 ADD17 such violation in its Report or Supplemental Report after which ChoicePoint shall have thirty (30) days to cure the violation and/or object in writing to the OAG, after which the OAG shall make a final determination regarding whether such material violation has occurred. 17. In the event that the Report or Supplemental Report shows a material violation of subparagraphs 6.d and 6.e of this Assurance that was not cured within thirty (30) days of written notice to ChoicePoint, the OAG may require, and ChoicePoint agrees to engage at its own cost, a further Supplemental Report, which shall follow the processes and procedures described in the Plan and shall be provided to the OAG within thirty (30) days of such engagement. 18. The OAG, at its reasonable discretion, shall have the right to require ChoicePoint to change the Consultant. Monetary Payment 19. ChoicePoint agrees to pay the sum of$200,000 to the State ofNew York. 20. Payment shall be made within thirty (30) days of the Effective Date in the form of a wire transfer, or a certified or bank check made out to the New York State Department of Law and forwarded to the Office of Attorney General, Civil Rights Bureau, 120 Broadway, New York, New York 10271, Attention: Alphonso David, Bureau Chief for Civil Rights. Any payments and all correspondence related to this Assurance must reference AOD No. 09-165. 17 ADD18 Miscellaneous 21. OAG has agreed to the terms of this Assurance based on, among other things, the representations made to OAG by ChoicePoint and its counsel and OAG's own factual investigation as set forth in Findings 2 - 5 above. To the extent that any material representations are later found to be inaccurate or misleading, this Assurance is voidable by OAG in its sole discretion. 23. This Assurance will expire three (3) years after the Effective Date, except that the OAG may, in its sole discretion, extend the Assurance term upon a good-faith determination that ChoicePoint has not complied with this Assurance, which non-compliance the OAG will discuss and attempt to resolve with ChoicePoint in good faith before making such determination. 24. No representation, inducement, promise, understanding, condition, or warranty not set forth in this Assurance has been made to or relied upon by ChoicePoint in agreeing to this Assurance. 25. This Assurance binds ChoicePoint and its principals, directors, beneficial owners, officers, shareholders, successors, assigns, "d/b/a" companies, subsidiaries and affiliates, and any other business entities whom any such individuals may hereafter form or control. 26. ChoicePoint represents and warrants, through the signatures below, that the terms and conditions of this Assurance are duly approved, and execution of this Assurance is duly authorized. ChoicePoint agrees not to take any action or make any statement denying, directly or indirectly, the propriety of this Assurance or expressing the view that this Assurance is without factual basis. Nothing in this paragraph affects ChoicePoint's (i) testimonial obligations or (ii) right to take legal or factual positions in defense of 18 ADD19 litigation or other legal proceedings to which OAG is not a party. This Assurance is not intended for use by any third party in any other proceeding and is not intended, and should not be construed, as an admission of liability by ChoicePoint. 27. This Assurance may not be amended except by an instrument in writing signed on behalf of all the parties to this Assurance. 28. This Assurance shall be binding on and inure to the benefit of the parties to this Assurance and their respective successors and assigns, provided that no party, other than OAG, may assign, delegate, or otherwise transfer any of its rights or obligations under this Assurance without the prior written consent ofOAG. 29. In the event that any one or more of the provisions contained in this Assurance shall for any reason be held to be invalid, illegal, or unenforceable in any respect, in the sole discretion of OAG such invalidity, illegality, or unenforceability shall not affect any other provision of this Assurance. 30. To the extent not already provided under this Assurance, ChoicePoint agrees to, upon request by OAG, provide all documentation and information necessary for OAG to verify compliance with this Assurance. 31. All notices, reports, requests, and other communications to any party pursuant to this Assurance shall be in writing and shall be directed as follows: lfto OAG, to: Andrew Elmore Section Chief Office of the Attorney General Civil Rights Bureau, 23rd Floor 120 Broadway New York, New York 10271-0332 19 ADD20 If to ChoicePoint, to: David M. Zornow, Esq. Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036-6522 Any changes in the person to whom communications should be specifically directed shall be made in advance of the change. 32. Acceptance ofthis Assurance by OAG shall not be deemed approval by OAG of any of the practices or procedures referenced herein, and ChoicePoint shall make no representation to the contrary. 33. Pursuant to Executive Law Section 63( 15), evidence of a violation of this Assurance shall constitute prima facie proof of violation of the applicable law in any action or proceeding thereafter commenced by OAG. 34. If a court of competent jurisdiction determines that ChoicePoint has breached this Assurance, ChoicePoint shall pay to OAG the cost, if any, of such determination and of enforcing this Assurance, including without limitation legal fees, expenses, and court costs. 35. OAG finds the relief and agreements contained in this Assurance appropriate and in the public interest. OAG is willing to accept this Assurance pursuant to Executive Law § 63( 15), in lieu of commencing a statutory proceeding. This Assurance shall be governed by the laws ofthe State ofNew York without regard to any conflict of laws principles. 36. Nothing contained herein shall be construed so as to deprive any person of any private right under the law. 20 IN WllNESS THEREOF, this Assurance is executed by the parties hereto on December I q- 2009. Dated: New York, New York December __1}_, 2009 CONSENTED TO: Dated: New York, New York December / ;.... , 2009 By: By: Executive Officer DavidM. Z~~ Anand S. Raman Austin K. Brown Counsel to ChoicePoint WorkPlace Solutions Inc. Skadden, Arps, Slate, Meagher & Flom LLP ANDREW M. CUOMO Attorney General of the State ofNew York AI~ Bureau Chief encer Freedman OWlsel for Civil Rights Andrew J. Elmore Section Chief - Office of the New York State Attorney General 120 Broadway, 23rd Floor New York, New York 10271 Tel. (212)416-8250 Fax (212) 416-8074 21 ADD21 EXHIBIT A ACKNOWLEDGMENT FORM ChoicePoint On _, 20 _, I received and fully read the Assurance of Discontinuance entered into between the New York Office of Attorney General ("OAG") and ChoicePoint regarding ChoicePoint's obligation to adhere to its revised policies related to preparing criminal history reports, and providing pre-screening and adjudication services to clients for employment purposes in New York State, specifically to comply with federal, state and local laws regarding the reporting of and consideration of criminal background history for employment purposes. I understand my legal responsibilities and will comply with those responsibilities. I have been informed by my employer that I will not be retaliated against by my employer for providing information to any law enforcement agency (including the New York State Office of the Attorney General, Civil Rights Bureau, 120 Broadway, 23rd Floor, New York, NY 10271, telephone {800) 771-7755 or (212) 416-8250) or official regarding my employer's compliance with the above laws. Print Name: Signature: Date: ---------------------- ------------- 22 ADD22 EXHIBITB ACKNOWLEDGMENT FORM ChoicePoint On _, 20 __, I attended a training seminar with respect to my responsibilities under the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. §§ 1681 et seq., New York Executive Law §§ 296(6), (15) and (16), New York Correction Law §§ 752-53, New York General Business Law § 380 et ~., and New York City Administrative Code § 8-107(10). I was also instructed as to ChoicePoint's policies and procedures related to ChokePoint's clients who use ChokePoint services for employment purposes in New York State, which require ChoicePoint to provide such clients with a certain notice related to the above laws, and prohibits ChokePoint from providing certain specified categories of records to clients for employment purposes that cannot be lawfully considered in an employment application. I understand my legal responsibilities and will comply with those responsibilities. I have been informed by my employer that I will not be retaliated against by my employer for providing information to any law enforcement agency (including the New York State Office of the Attorney General, Civil Rights Bureau, 120 Broadway, 23rd Floor, New York, N Y I 0271 , telephone (800) 771-7755 or (2 12) 416-8250) or official regarding my employer's compliance with the above laws. Print Name: Signature: Date: ---------------------- ------------- 23 ADD23 ADD24 ERIC T. SCHNEIDERMAN ArroRNBYGI!NERAL BretT. Jardine, Esq. EVP, General Counsel First Advantage I 00 Carillon Parkway St Petersburg, Florida 33716 United States Re: First Advantage Dear Bret, * > .; ' ~ ..J:" n.,.,;J.. STATE OF NEW YoRK OFFICE OF THE ATTORNEY GENERAL D IVISION OF SOCIAL JUSTICE CrvtL RloHTS BUIU!Au August 19,2013 The New York State Office of the Attorney General (the "OAG") is committed to enforcing state law that ensures that job applicants receive fair and equal consideration for employment opportunities. New York Executive Law§§ 296(1), (15) and (16), Correction Law §§ 751-53, and New York General Business Law§ 380 et seq., require that employers consider a number of factors before disqualifying an applicant based upon a criminal conviction, including but not limited to the nature and gravity of the conviction and its bearing, if any, on specific responsibilities of the job sought, the time that elapsed since the conviction, the. age of the applicant when the offense was committed, and any evidence of rehabilitation. In addition, those laws also require that employers refrain from considering non-pending arrests that were terminated in favor of the individual and/or resulted in a sealed conviction, youthful offender adjudication, or most violations and infractions, and require that applicants be notified about their rights to request a copy of the consumer report and contest any errors therein. These laws also impose requirements upon consumer reporting agencies retained by employers to screen job candidates. See. e.g. National Organization of Women v. State Div. of Human Rights, 34 N.Y.2d 416 (N.Y. 1974); D'Amico v. Commodities Exchange, Inc., 235 A.D.2d 313,315 (N.Y. App. Div. 1st Dep't 1997) (finding it "settled precedent ... that an individual may be held liable under[§ 296(6)] for aiding and abetting discriminatory conduct" with regard to a third-party corporation). ADD25 To that end, First Advantage has agreed to refrain from aiding employers in any practices that would run afoul of antidiscrimination law. Specifically, First Advantage agrees to consistently maintain policies and practices that will not result in a blanket ban on the consideration of job applicants with criminal histories. Such policies and practices include: • Not issuing rejection or declination letters triggered by an automatic disqualification based on a criminal record. • Avoiding the use oflabels on screening reports that suggest, directly or indirectly, that a job candidate is disqualified or unqualified for a position solely because of the results of a criminal background check. Such labels include, but are not limited to, "disqualified" or "does not meet hiring criteria." • In every instance, returning all consumer reports to the employer for an individualized consideration of the job applicant in accordance with criteria required by state law. • Communicating these limitations on its role and the requirements ofNew York State law to current clients. • Amending all promotional materials to clarity these practices for prospective clients. We commend First Advantage for its cooperation and for sharing the OAG's commitment to ensuring the rights of New Yorkers to equal employment opportunity. Civil Rights Bureau Sandra Pullman Assistant Attorney General m Bret Jardine First Adv ERIC T. SCHNEIDERMAN ArroRNEY GENERAL. Andrew Porter Sterling Infosystems 1 State Street Plaza 24th floor New York, NY 1 0004 ~""-( ' ~!:!•'!.;.;-:....- . STATE OF NEW YORK OFFICE OF THE ATTORNEY GENERAL Re: Consumer Reporting Practices Dear Andrew: DIVISION OF SOCIAL JUSTICE Ctvu. RtGHTS BuREAU November 25,2013 The New York State Office of the Attorney General (the "OAG") is committed to enforcing state law that ensures that job applicants receive fair and equal consideration for employment opportunities. New York Executive Law§§ 296(1), (15) and (16), Correction Law§§ 751-53, and New York General Business Law§ 380 et seq., require that employers consider a number of factors before disqualifying an applicant based upon a criminal conviction, including but not limited to the nature and gravity of the conviction and its bearing, if any, on specific respOnsibilities of the job sought, the time that elapsed since the conviction, the age of the applicant when the offense was committed, and any evidence of rehabilitation. In addition, those laws also require that employers refrain from considering non-pending arrests that were terminated in favor of the individual and/or resulted in a sealed conviction, youthful offender adjudication, or most violations and infractions, and require that applicants be notified about their rights to request a copy of the consumer report and contest any errors therein. These laws also impose requirements upon consumer reporting agencies retained by employers to screen job candidates. See. e.g. National Organization ofWomen v. State Div. of Human Rights, 34 N.Y.2d 416 (N.Y. 1974); D'Amico v. Commodities Exchange, Inc., 235 A.D.2d 313, 315 (N.Y. App. Div. lst Dep't 1997) (finding it "settled precedent ... that an individual may be held liable under [§ 296(6)) for aiding and abetting discriminatory conduct" with regard to a third-party corporation). To that end, Sterling has agreed to refrain from aiding employers in any practices that would run afoul of antidiscrimination law. Specifically, Sterling agrees to consistently maintain policies and practices that will not result in a blanket ban on the consideration of job applicants with criminal histories in New York. Upon execution of this agreement, Sterling will advise clients who hire applicants in New York that it will maintain the following policies and practices, which will be ADD26 ADD27 implemented as soon as technologically feasible: • Not issuing rejection or declination letters triggered by an automatic disqualification based on a criminal record. • A voiding the use oflabels on screening reports that suggest, directly or indirectly, that a job candidate is disqualified or unqualified for a position solely because of the results of a criminal background check. Such labels include, but are not limited to, "disqualified" or "does not meet hiring criteria." • In every instance, returning all consumer reports that contain criminal convictions to the employer for an individualized consideration of the job applicant in accordance with criteria required by state law. • Communicating these limitations on its role and the requirements of New York State law to current clients. • Amending all promotional materials as necessary to clarify these practices for prospective clients. We commend Sterling for its cooperation and for sharing the OAG's commitment to ensuring the rights ofNew Yorkers to equal employment opportunity. By: Sincerely, ERIC T. SCHNEIDERMAN Attorney General of the State of New York Kristen Clarke Bureau Chief Civil Rights Bureau .L ~ Assistant Attorney General 72'1& Andrew Porter Sterling lnfosystems Mar. 3. 2014 9: 37PM ERIC T. SCHNtiDE~ AnORNBVO~ STATEOFNEWYORK 0FF1CE OF l1iB ATTORNEY GENERAL General Information Services, Inc. Attn: Chris Lemens, General Counsel 12770 CoitRoad, Swte 1200 Dallas, TX 75251 Re: Consumer Reporting Practices Dear Chris: No. 2061 P. 2 DIVISION OF SOCIAL JUSTICE CMx. Rlomt BtJJ.~~AU March 3, 2014 The New York State Office of the Attorney General (the "OAG") is committed to enforcing state law that ensures that job applicants receive fair and equal consideration for employment opportunities. New York Executive Law§§ 296(1), (15) and (16), Correction Law§§ 751-53, and New York General Business Law§ 380 etseq., require that employers consider a number of factors before disqualifying an applicant based upon a criminal conviction, including but not limited to the nature and gravity of the conviction and its bearing, if any, on specific responsibilities of the job sought, the time that elapsed since the conviction, the age of the applicant when the offense was committed, and any evidence of rehabilitation. In addition, those laws also require that employers refrain from considenng non-pending arrests that were terminated in favor of the individual and/or resulted in a sealed conviction, youthful offender adjudication, or most violations and infractions, and require that applicants be notified about their rights to request a copy of the consumer report and contest any errOrs therein. These laws also impose requirements upon consumer reporting agencies retained by employers to screen job candidates. See. e.g. National Organization of Women v. State Div. of Human Rights, 34 N.Y.2d 416 (N.Y. 1974); D'Amico v. Commodities Exth(mge, lnc., 235 A.D.2d 313, 315 (N.Y. App. Div. 1st Dep't 1997) (fmding it "settled precedent ... that an individual may be held liable under(§ 296(6)) for aiding and abetting discriminatory conduct'' with regard to a thlrd-party corporation). To that end, General Information Services, Inc. ("GIS") bas agreed to refrain from aiding employers in any practices th~twould run afoul of antidiscrimination law. Specifically, GIS agrees tO consistently maintain policies and practices that will not result in a blanket ban on the r. /'t~~~ideration of job applicants with criminal histories. Such policies and practices include the ~wing for employment located in New York: . ADD28 Mar 3. 2014 9: 37PM No. 2061 P. 3 • Not issuing rejection or declination letters triggered by an automatic disqualification based on a criminal record. We anticipate that GIS will continue to send these kinds ofletters - required by the federal Fair Credit Reporting Act - when an employer informs GIS of a decision after GIS returns a report to the employer for individualized consideration. We also anticipate that GIS may continue to send a copy of the report to the applicant or employee. so that the applicant or employee may correct any inaccurate information on the report before the employer makes a decision. • Avoiding the application by GIS of labels on screening reports that suggest. directly or indirectly, that a job candidate is disqualified or unqualified fora position solely because of the results of a criminal background check:, Such labels include, but are not limited to, "disqualified" or "does not meet hiring criteria." We anticipate that GIS will continue to designate applicants as ineligible or disqualified based on the results of a criminal background check if and when an employer informs GIS of such a decision after GIS has returned the report to the employer for individualized consideration. • In every instance, returning all consumer reports to the employer for an individualized consideration of the job applicant in accordance with criteria required by state law. • Communicating these limitations on its role and the requirements ofNew Y ark: State law to current cHents. • Amending promotional materials to clarify these practices for prospective clients. GIS has represented that its systems were designed to automate the notice processes that the federal FCRA requires employers to use, and that it is currently working to bring those systems into confonnity with the agreement above. GIS agrees to finalize these changes as soon as possible. We commend GIS for its cooperation and for sharing the OAG's commitment to ensuring the s of New Yorkers to equal employment opportunity. . . · ERIC T. SCHNEIDERMAN Attorney General of the State ofNew York By: wcu ADD29 Kristen Clarke Bureau Chief Civil Rights Bureau Sandra Pullman Assistant Attorney General I Mu. 3. 2014 9:38PM ...---- .. .. _ No. 2061 P. 4 Agreed to for General Infonnation Se By: Chris Lemens Executive Vice President ADD30 ADD31 E'QJ<.: '1'. SCI!NEID~RMAN Arro~~.NEY ~AL Mike Petrullo, President & CEO HireRight, Inc. 51.51 California Avenue Irvine, CA 92617 Re: Consumer Reporting Practices Dear Mike: DrvTSlON OF SociAl- Jusncc. CtvtL RlOl:iT~ BtiR'P..AtT March 5, 2014 The New York State Office of the Attorney General (the .. OAG") is committed to enforcing state law that ensures that job applicants receive fair and equal consideration for employment opportunities. New York Executive Law§§ 296(1), (15) and (16)> Co1Tection Law§§ 751-53, and New York General Business Law§ 380 et seq., require that employers consider a number of factors before disqualifying an applicant based upon a criminal conviction, including but not limited to the nature and gravity of the conviction and its bearing, if any, on specific responsibilities of the job sought, tl1e time that elapsed since the conviction, the age of the applicant when the offense was committed, and any evidence of rehabilitation. In addition, those laws also require that employers refrain from considering non-pending arrests that were terminated in favor of the individual and/or resulted in a sealed conviction, youthful offender adjudication, or most violations and infractions, and require that applicants be notified about their rights to request a copy of the consumer report and contest any errors therein. Our office has explained that these laws also impose requirements upon consumer reporting agencies retained by employers to screen job candidates. See. e.g. National Organization of Women v. Stale Dtv. of Hwnan Rights, 34 N.Y.2d 41.6 (N.Y. 1974); D'Amico v. Commodlrles ExcJumge, lnc., 2.35 AD.2d 313, 315 (N.Y. App. Div. 1st Dep't 1997) (finding it "settled precedent ... that an individual may be held liable under [§ 296(6)} for aiding and abetting discriminatory conduct11 with regard to a third-party corporation). In a cooperative effort with the OAG to carry out the requirements of New York State law, HireRight, Inc. C1HireRight'') confirms that it has some and is further implementing policies and practices to refrain from aiding employers in any practices that would run afoul of antidiscrimination ADD32 law in New York. Specifically, HireRight will maintain policies to preclude application of a blanket ban by its employer clients on the consideration of New York job applicants with criminal histories. Such policies and practices include: • Not issuing rejection or declination letters for an employer client who requests that HireRight apply an automatic disqualification based on a criminal record, except where a bar to employment is imposed by law. · • Avoiding the use of labels on screening t'epons that suggest, directly or indirectly, that a job candidate is disqualified or unqualified for a position solely because of the results of a criminal background check prior to review and analysis of the information in the report by the employer. Such labels include, but are not limited to, 11 disqualified" or udoes not meet hiring criteria." • Returning aU consumer reports that contain criminal convictions to the employer for an individualized consideration of the job applicant in accordance with criteria required by New York State law. • Communicating these limitations on its role and the requirements of New York State law to current clients. • Ensuring that its promotional materials for prospective clients are consistent with these practices. We commend HireRight for its proactive steps and cooperation and for sharing the OAG's commitment to ensuring the rights of New Yorkers to equal employment opportunity. ERIC T . SCHNEIDERMAN Attomey General of the State of New York By: Kristen Clarke Bureau Chief, Civil Right Sandra Pullman Assistant Attorney General A.G. Schneiderman Announces Agreements With Background Check Agencies To End Illegal Hiring Practices Industry-Transforming Agreements With Top Four Agencies Will Stop Unlawful Disqualification Of J ob Seekers Schneiderman: The Law Requires That Those Who Paid Their Debt To Society Receive Equal Access To Employment Opportunities NEW YORK - Attorney General Eric T. Schneiderman announced today that his office has secured agreements with four of the nation’s largest background check agencies. The agreements prohibit the agencies from automatically disqualifying applicants with criminal convictions and require the agencies to defer hiring decisions to employers who must conduct an individualized consideration of candidates in accordance with New York State law. Under the agreements, HireRight Inc., First Advantage, General Information Services Inc. and Sterling Infosystems agree to follow New York laws that make it illegal to automatically disqualify job applicants based solely on criminal history. Specifically, the agencies agree not to issue automatic rejection letters triggered by a conviction on behalf of employers to ensure that employers conduct the required case-by-case, individualized assessments of job candidates. “New Yorkers who have paid their debt to society deserve a fair shot at employment opportunities,” Attorney General Schneiderman said. “Background check agencies that implement blanket bans on hiring ex-offenders are violating New York State law. My office is committed to reforming practices in this industry that frustrate efforts at rehabilitation.” State law requires that employers consider a number of mitigating factors in making hiring decisions based on criminal history. These include, for example, the nature and gravity of an applicant's criminal conviction; its bearing, if any, on the specific responsibilities of the job sought; the time that has elapsed since the conviction; the age of the applicant at the time when the offense was committed, and evidence of rehabilitation. The law further prohibits third parties from aiding and abetting employers in violating the statute. Attorney General Schneiderman’s office is committed to upholding these laws to ensure that all New Yorkers receive equal access to job opportunities. The Attorney General’s office began reviewing compliance by the companies after receiving information in 2013 that it was industrywide practice to use grading criteria and instructions provided by employers to automatically disqualify job applicants based on the information contained in a criminal background report. By focusing on the largest agencies - which are relied upon by employers across the state - the Attorney General aims to make those employers who seek to ignore the law’s requirements by having background check agencies carry out the unlawful conduct follow the law. First Advantage, headquartered in Florida, serves more than 45,000 customers globally. Verifications Inc., which has also reformed its practices in response to the Attorney General’s initiative, was acquired by First Advantage last year. HireRight Inc., headquartered in California, does business in 200 countries, and Sterling Infosystems, headquartered in Manhattan, serves more than 20,000 customers globally. General Information Services Inc. claims more than 2,500 clients nationwide. Sherr ilyn Ifi ll, President and Director -Counsel of the NAACP Legal Defense and Educational Fund, said, “Hiring policies and practices that automatically disqualify job candidates with criminal histories have contributed to the disproportionately high rates of unemployment seen in minority communities today. These agreements will help transform the industry and will ensure that more African-Americans, Latinos and other communities of color who have been disproportionately impacted by the war on drugs will have better access to equal employment opportunities.” ADD33 Patr icia Warth, Co-Director of Justice Strategies at the Center for Community Alternatives, a non-profit organization that provides support services to individuals with criminal histories, said, “Getting a job is an important first step for people with prior criminal convictions looking for a fresh start. No companies should profit by erecting barriers to reentry. We applaud Attorney General Eric Schneiderman for taking steps to bring consumer reporting agencies into compliance with the law.” Pursuant to the agreements and the requirements of state law, the consumer reporting agencies will revise their policies and cease issuing rejection letters triggered by an automatic disqualification; return all background reports to employers to make individualized hiring decisions about applicants with criminal convictions, and communicate these limitations on their roles to all current and prospective clients. These agreements are part of the Attorney General’s continuing efforts to combat barriers to successful reentry by improving access to employment opportunities for individuals with criminal convictions who are seeking to contribute meaningfully to their communities. Last year, the Attorney General’s Civil Rights Bureau secured an agreement with a Fortune 500 company to ensure that persons with criminal history records will receive fair consideration when seeking employment. The Bureau has also responded to municipalities across the state that adopt local ordinances that do not comply with state law requirements. This matter is being handled by Assistant Attorney General Sandra Pullman of the Attorney General’s Civil Rights Bureau, which is led by Bureau Chief Kristen Clarke. The Bureau is part of the Social Justice Division, led by Executive Deputy Attorney General for Social Justice Alvin Bragg. The Civil Rights Bureau of the Attorney General's Office is committed to promoting access to equal employment opportunities and combating discrimination faced by all New Yorkers. To file a civil rights complaint, contact the Attorney General’s Office at (212) 416-8250, civil.rights@ag.ny.gov or visit www.ag.ny.gov. ADD34 Executive Law § 296. Unlawful discriminatory practices. 6. It shall be an unlawful discriminatory practice for any person to aid, abet, incite, compel or coerce the doing of any of the acts forbidden under this article, or to attempt to do so. 15. It shall be an unlawful discriminatory practice for any person, agency, bureau, corporation or association, including the state and any political subdivision thereof, to deny any license or employment to any individual by reason of his or her having been convicted of one or more criminal offenses, or by reason of a finding of a lack of "good moral character" which is based upon his or her having been convicted of one or more criminal offenses, when such denial is in violation of the provisions of article twenty-three-A of the correction law. Further, there shall be a rebuttable presumption in favor of excluding from evidence the prior incarceration or conviction of any person, in a case alleging that the employer has been negligent in hiring or retaining an applicant or employee, or supervising a hiring manager, if after learning about an applicant or employee's past criminal conviction history, such employer has evaluated the factors set forth in section seven hundred fifty-two of the correction law, and made a reasonable, good faith determination that such factors militate in favor of hire or retention of that applicant or employee. ADD35 Correction Law § 752. Unfair discrimination against persons previously convicted of one or more criminal offenses prohibited. No application for any license or employment, and no employment or license held by an individual, to which the provisions of this article are applicable, shall be denied or acted upon adversely by reason of the individual's having been previously convicted of one or more criminal offenses, or by reason of a finding of lack of "good moral character" when such finding is based upon the fact that the individual has previously been convicted of one or more criminal offenses, unless: (1) there is a direct relationship between one or more of the previous criminal offenses and the specific license or employment sought or held by the individual; or (2) the issuance or continuation of the license or the granting or continuation of the employment would involve an unreasonable risk to property or to the safety or welfare of specific individuals or the general public. ADD36 Correction Law § 753. Factors to be considered concerning a previous criminal conviction; presumption. 1. In making a determination pursuant to section seven hundred fifty- two of this chapter, the public agency or private employer shall consider the following factors: (a) The public policy of this state, as expressed in this act, to encourage the licensure and employment of persons previously convicted of one or more criminal offenses. (b) The specific duties and responsibilities necessarily related to the license or employment sought or held by the person. (c) The bearing, if any, the criminal offense or offenses for which the person was previously convicted will have on his fitness or ability to perform one or more such duties or responsibilities. (d) The time which has elapsed since the occurrence of the criminal offense or offenses. (e) The age of the person at the time of occurrence of the criminal offense or offenses. (f) The seriousness of the offense or offenses. (g) Any information produced by the person, or produced on his behalf, in regard to his rehabilitation and good conduct. (h) The legitimate interest of the public agency or private employer in protecting property, and the safety and welfare of specific individuals or the general public. 2. In making a determination pursuant to section seven hundred fifty- two of this chapter, the public agency or private employer shall also give consideration to a certificate of relief from disabilities or a certificate of good conduct issued to the applicant, which certificate shall create a presumption of rehabilitation in regard to the offense or offenses specified therein. ADD37