Employers engaged in heavily-regulated businesses understand that compliance with a myriad of regulatory schemes is critical to their continued operations and their bottom line. HR professionals for these employers must ensure that they are aware of all applicable requirements related to prospective and current employee criminal background checks, especially those requirements affecting who can and cannot be hired.

In particular, long-term care facilities (i.e. assisted living facilities, nursing homes, and retirement communities), are subject to specific federal and state law requirements that prohibit them from hiring individuals with certain criminal histories to serve in certain positions. Compliance with these requirements affects whether the facility is permitted to operate in the state as well as whether the facility is paid for the care it provides to residents.

For example, as a condition to simply maintaining a state license to operate an assisted living facility in South Carolina, the facility cannot hire anyone who has ever been convicted of abuse, neglect, or exploitation of a child or vulnerable adult under South Carolina state law. In addition, if the facility wants to participate in the Medicaid Optional State Supplementation Program and receive reimbursement for certain services provided to its residents, then the applicable South Carolina Medicaid Provider Manual prohibits anyone from working in the facility who has been convicted of a felony within the last 10 years if that individual would provide “administrative support/services to SCDHHS participants.” Likewise, in order to obtain and keep a state license to operate a nursing home, the facility cannot hire anyone who has ever been convicted of “child or adult abuse, neglect, or mistreatment, or any other felony.” At the federal level, in order for a nursing home to participate in the Medicare Program and receive reimbursement for services provided to residents, it “must prohibit the employment of individuals with a conviction or prior employment history of child or client abuse, neglect or mistreatment.”

Even if these employers can maintain their licenses because none of their employees has the above-listed criminal history, it is important to note that South Carolina law also requires that criminal background checks be conducted for certain individuals, and employers are subject to civil penalties imposed by the South Carolina Department of Health and Environmental Control (SCDHEC) for failure to do so.   Specifically, “direct care entities” are required to conduct criminal background checks for prospective employees or contractors to work as “direct caregivers,” as defined below, pursuant to certain SCDHEC-specified procedures.


Direct Care Entities

Direct Caregivers

  • nursing homes
  • assisted living facilities
  • adult daycare facilities
  • home health agencies
  • hospice programs
  • in-home care providers (a/k/a private duty nursing)
  • psychiatric residential treatment facilities for children and adolescents
  • residential programs operated or contracted for operation by the South Carolina Department of Mental Health or Department of Disabilities and Special Needs



  • a registered nurse, licensed practical nurse, or certified nurse assistant;
  • any other licensed professional employed by or contracting with a direct care entity who provides to patients or clients direct care or services and includes, but is not limited to, a physical, speech, occupational, or respiratory care therapist;
  • a person who is not licensed but provides physical assistance or care to a patient or client served by a direct care entity;
  • a person employed by or under contract with a direct care entity who works within any building housing patients or clients;
  • a person employed by or under contract with by a direct care entity whose duties include the possibility of patient or client contact.

HR professionals should acknowledge that there may exist a “Catch-22” between complying with the above-cited requirements and avoiding Title VII liability if refusing to hire certain individuals based on state law prohibitions results in disparate treatment of or disparate impact on protected classes of individuals under Title VII (e.g., race, national origin, gender). Specifically, in its 2012 Enforcement Guidance entitled, “Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964,” the EEOC emphasized that criminal background check practices may have a disparate impact on, for example, African American and Hispanic men who have a statistically higher arrest and incarceration rate than other classes of individuals. Although the EEOC advised that an employer’s compliance with federal law prohibitions against hiring individuals with certain criminal histories will be recognized as an absolute defense to claims brought under Title VII, the EEOC refused to afford that same level of deference to state law prohibitions. See http://www.eeoc.gov/laws/guidance/arrest_conviction.cfm.  Thus, despite the mandatory requirements of South Carolina-specific law identified above, these requirements may not provide employers with an absolute defense to allegations of Title VII discrimination based on a refusal to hire individuals with certain criminal histories.

Employers should be aware of absolute legal prohibitions against hiring individuals with certain criminal histories as well as any legal requirements to conduct criminal backgrounds checks regardless of their results. Although there is risk that state law prohibitions may not provide an absolute defense to any potential discrimination claims based on failure to hire, employers should still engage in efforts to preserve state law requirements as a defense. Therefore, employers are advised to ensure that their hiring practices related to absolute denials of employment based on state law requirements are tailored to those specific legal requirements and that they are applied consistently.