Are employers permitted to scrutinise a prospective employee’s criminal and credit history?

During the recruitment process, it is common practice for many employers to ask prospective employees questions about their criminal and credit records. The purpose, in general, is to ascertain the candidate’s suitability for the position. At first glance, this vetting process appears unproblematic. Employers should legitimately be entitled to request this information to ensure they have everything required to make an informed decision on the appointment. However, in the case of O’Connor v LexisNexis, the Labour Court determined that this practice could amount to discrimination in terms of the Employment Equity Act (Act 55 of 1998).

In this case, the Court was required to determine, inter alia, whether the refusal of LexisNexis to employ O’Connor because of his criminal record amounted to discrimination. The brief facts of the case are as follows:

In December 2023, the respondent (LexisNexis) advertised a position it wanted to fill for a “senior data discovery and enrichment expert”, which job entailed organising and classifying the information published in the respondent’s various legal products. The applicant (O’Connor) applied for the position.

On 20 January 2024, the respondent emailed the applicant, saying that his interview had been positive and that the respondent required further information from the applicant to continue processing the application. This information included a “reference check consent and indemnity form”. The applicant furnished the requested information the following day. When filling out the above-mentioned form, the applicant responded “yes” when asked if he had ever been criminally charged. In response to the “if yes, details of charge or conviction”, the applicant specified that he had been charged with theft in 2001, which has been expunged.

On the 20th of January, the respondents sent the applicant an e-mail stating that it was pleased to offer the respondent a permanent position as a senior data discovery management expert effective from the 15th of February… the offer of employment was subject to the reference check verifying credentials as valid, criminal checks being clear and a positive reference from a previous employer. The applicant accepted the offer on the same day.

The position he applied for was entirely remote, and the applicant would work from home.

On the 6th of February 2024, the respondent emailed the applicant stating that they were retracting the conditional offer of employment because the criminal check revealed six counts of theft, one of fraud and two of defeating the course of justice.

The applicant responded by explaining that these convictions took place 20 years ago and that his criminal record had, in fact, been expunged. He pleaded for an opportunity to explain. There was never any response from the respondent. The applicant then referred a dispute to the CCMA, and the matter would be set down for conciliation. A certificate of non-resolution was issued, and two days later, the applicant approached the Labour Court.

In determining whether the applicant was discriminated against, the court referred to provisions of the Employment Equity Act (The Act) and The Code of Good Practice on the Integration of Employment Equity into Human Resource Policies and Practices (The Code).

Section 6 of the Act prohibits unfair discrimination in the workplace. This section lists recognised grounds on which a person may not be discriminated against as well as “any other arbitrary ground.”

It is important to note that Section 9 of the Act further defines an “employee” for the purposes of the Act as including an applicant for employment. Therefore, the employer cannot raise a defence that the employment relationship had not yet come into existence. A person who applies for employment can also be discriminated against in terms of the Act.

Paragraph 7.3.32 of the Code provides that “an employer should only conduct integrity checks, such as verifying the qualifications of an applicant, contacting credit references and investigating whether the applicant has a criminal record, if this is relevant to the requirements of the job.”

Paragraph 17.3.6 of the Code states further that: “an employer may only collect personal data regarding an employee’s sex life, political, religious or other beliefs, or criminal convictions, except in exceptional circumstances where such information may be directly relevant to an employment decision”.

The above provisions suggest that the exclusion of an applicant from employment based on their criminal or credit record could constitute discrimination on an arbitrary ground if the record were irrelevant to the job requirements.

The Court considered the Judgment of Naidoo and Others v Parliament of the Republic of South Africa and upheld the finding that discrimination on an arbitrary ground could only be sustained if it is based on attributes or characteristics that have the potential to impair the fundamental dignity of persons as human beings. It is submitted that the presence of a criminal record has this potential. Having been convicted of a crime has a direct bearing on how a person is perceived by society.

When considering whether the presence of a criminal record has an effect on whether the applicant can perform the duties is an objective test. The feelings or views of the employer on the matter are largely irrelevant. For example, a person cannot be excluded from employment because the employer feels uncomfortable employing persons with a criminal record. The applicant’s ability to perform the duties would need to be compromised as a direct result of the criminal record. Some examples include certain statutory requirements for an employee to be without a criminal record or the client of a service provider who requires employees of that service provider to be without a criminal record when performing services.

It is further submitted that the recruitment process should not include questions relating to criminal history if the job requirements do not require it. The code expressly discourages the collation of this information except in “exceptional circumstances”.

In the present case, the respondent was judged to have discriminated against the applicant by not employing him because of his criminal record and was ordered to employ him on the terms of the offer of employment previously made.

The above scenario should be distinguished from the situation where an employer legitimately requests a criminal record from an applicant, and the applicant fraudulently misleads the employer with untruthful responses. In these circumstances, the employer’s failure to employ the applicant based on his untruthfulness would constitute a reasonable reason for the decision not to employ them.

Written by Stephen Kirsten, Provincial Manager at Consolidated Employers Organisation (CEO SA)