Wisconsin Supreme Court Clarifies When a Conviction is Substantially Related to An Individual’s Employment
In a case in which Quarles & Brady’s Bob Duffy and Lindsey Davis were honored to represent Cree, Inc. (“Cree”), on March 10, 2022 the Wisconsin Supreme Court provided long awaited and important guidance concerning when an individual’s crime may be substantially related to that person’s employment and thereby allow the employer not to employ that individual. Reversing both the Labor and Industry Review Commission (“LIRC”) and the Court of Appeals, in Cree, Inc. v. Lab. & Indus. Rev. Comm’n, the Wisconsin Supreme Court held that Cree acted lawfully when it rescinded a job offer it made to Derrick Palmer (“Palmer”) after it learned of his convictions for strangulation, battery, and sexual assault in a domestic setting.
The Court’s 4-3 decision in Cree is significant because LIRC—the agency responsible for interpreting the Wisconsin Fair Employment Act (“WFEA”)—had previously and repeatedly held that domestic violence convictions were not substantially related to employment in non-domestic settings. The Cree decision, however, makes clear that convictions for domestic violence are to be treated no differently under the WFEA’s “substantial relationship” test than convictions for violence in any other setting.
The Substantial Relationship Exception
The WFEA prohibits employers from discriminating against employees or applicants on the basis of conviction record unless the employer is able to establish that the circumstances of the person’s conviction “substantially relate” to the circumstances of the job. Given its long-standing belief that crimes occurring in the context of personal relationships and/or domestic settings are not likely to be repeated in the workplace, LIRC previously held that domestic violence crimes do not substantially relate to employment in non-domestic settings. The Cree decision rejects such a narrow view of domestic violence crimes and whether they may be substantially related to any particular job.
The Underlying Facts and Previous Decisions in the Case
In 2015, Palmer applied for an Applications Specialist position at Cree’s Racine, Wisconsin facility—a campus which spanned over 600,000 square feet and was home to over 1,000 employees. The Applications Specialist position involved designing lighting systems for commercial customers. Individuals in that position functioned largely independently, without close supervision, and were occasionally required to visit customers and to travel to trade shows outside of Wisconsin. The job also involved a certain amount of stress, including meeting customer demands within Cree’s production schedules.
Shortly after Palmer submitted his application, Cree offered him the job subject to the results of its standard background check. The background check revealed that in 2013 Palmer had been convicted of eight crimes of domestic violence against his then live-in girlfriend. More specifically, Palmer pled no contest to two counts of felony strangulation and suffocation, four counts of misdemeanor battery, one count of fourth degree sexual assault, and one count of criminal damage to property. Based on the results of Palmer’s background check, Cree rescinded its employment offer.
Palmer then filed a complaint with Wisconsin’s Equal Rights Division (“ERD”), alleging that Cree unlawfully discriminated against him on the basis of his conviction record when it rescinded his job offer. After Palmer filed his complaint, Cree learned that in 2001 Palmer had also been convicted of domestically battering a different girlfriend.
The years-long litigation that followed the filing of Palmer’s ERD complaint was succinctly described by the Wisconsin Supreme Court as “seesawing.” Following the ERD hearing, the Administrative Law Judge determined that Palmer’s domestic violence convictions did substantially relate to the Applications Specialist position, and therefore that Cree did not violate the WFEA when it rescinded Palmer’s job offer. Palmer then appealed to LIRC, which reversed, finding that the circumstances of Palmer’s convictions did not substantially relate to the circumstances of his prospective employment. Consistent with its rulings in other domestic crimes cases, LIRC stated “where assault and battery convictions stem from personal relationships and the crimes are committed at home, it cannot necessarily be assumed that the individual is likely to engage in the same conduct with co-workers or customers in the workplace.”
Cree then appealed to the Circuit Court, which reversed LIRC, stating in part “while everyone experiences stress at work, not everyone reacts the same to stress…Palmer clearly demonstrated how he reacts to stress given the specific nature of his crimes.” Palmer then appealed to the Court of Appeals, which reversed the Circuit Court, holding that Cree failed to meet its burden to show a substantial relationship between Palmer’s convictions and the job. While the Court of Appeals also noted that Palmer would “almost certainly” be violent toward another woman in the future, it did not believe that Palmer’s violent tendencies and inclinations would occur on the job.
Cree then filed its petition for review with the Wisconsin Supreme Court. In its majority opinion, the Court noted that it accepted the petition for review because it recognized the “need for clarifying how employers, LIRC, and reviewing courts are to apply the substantial relationship test to domestic violence convictions.”
The Wisconsin Supreme Court’s Majority Opinion
The Wisconsin Supreme Court’s majority opinion—which Justice Jill Karofsky authored and Justices Ziegler, Roggensack and Rebecca Grassl-Bradley joined—held that the circumstances of Palmer’s domestic violence convictions did substantially relate to the circumstances of Cree’s Applications Specialist position. The Court therefore reversed the Court of Appeals, remanded the matter to the Circuit Court, and directed that it require LIRC to dismiss Palmer’s Complaint.
In reaching its decision, the Court found that the plain language of the WFEA’s substantial relationship test requires employers to show the “facts, events, and conditions surrounding the convicted offense materially relate to the facts, events, and conditions surrounding the job.” The Court concluded that the substantial relationship test does not require an exact identity between the circumstances of a crime and the circumstances of the job. As a result, it held that LIRC’s carveout for domestic violence crimes was improper. Rather, the Court directed that in applying the substantial relationship test, one must look beyond any immaterial identity between the circumstances of the crime—including the domestic context of the offense and intimate relationship with the victim—and the sought-after employment. The Court therefore required a review of the material circumstances fostering criminal activity—meaning those circumstances in the workplace that present opportunities for recidivism—in light of the character traits revealed by the circumstances of the domestic violence conviction.
Reviewing the circumstances of Palmer’s domestic violence convictions, the Court found that they revealed his general willingness to use violence to achieve power and control over another person, his disregard for the health and safety of others, and his inability to control anger or other emotions. The Court viewed Palmer’s convictions for strangulation and suffocation as particularly troubling given their proximity to homicide. It also noted the seriousness and recency of Palmer’s offenses and the pattern of violence emerging from his criminal history.
Reviewing the circumstances of the Applications Specialist position, and the potential opportunities for Palmer to re-offend in that role, the Court found that it involved largely independent work without close supervision, including visiting customers’ facilities and traveling to trade shows, which involved unsupervised use of rental cars and hotel rooms. The Court also found the job involved regular interaction with co-workers and customers, some level of conflict resolution between Cree and its customers, and responsibility for satisfying customer demands.
After reviewing the circumstances of both Palmer’s convictions and the Applications Specialist position, the Court held that the required substantial relationship was established in at least two ways: (1) Palmer’s willingness to exert power and control over others substantially related to the independent and interpersonal nature of the Applications Specialist job, where Palmer’s authority could be threatened and trigger him to react with violence; and (2) the absence of regular supervision could create opportunities for isolation and violent encounters, especially considering the secluded nature of Cree’s large, noisy facility and Palmer’s opportunities to work with customers at their facilities and to travel to trade shows.
The Dissenting Opinion
The Supreme Court’s dissenting opinion—which Justice Rebecca Frank Dallet authored and Justices Ann Walsh Bradley and Hagedorn joined—believed the majority went too far, effectively eliminating the substantial relationship test for crimes of domestic violence and creating a “per se substantial relationship between a domestic-violence conviction and the circumstances of any job that involves working with other people.” The dissent reasoned that if the state legislature intended such a sweeping exception to the WFEA’s conviction record discrimination prohibition it would have codified an exception in statute, as it did for other specific crimes and jobs (e.g., an employer may lawfully refuse to employ as a burglar alarm installer anyone convicted of a felony).
Employers in Wisconsin may now exercise more discretion when deciding whether to employ individuals who are convicted of violence in a domestic setting. If the specific job presents a reasonable opportunity for the character traits of the domestic violence crime to reoccur, an employer may choose not to employ one convicted of the domestic crime even if the job is in a non-domestic setting.
Given the careful and fact specific analysis required under the WFEA’s substantial relationship exception, employers may wish to consult with legal counsel before deciding not to employ an individual as the result of a conviction, including for domestic violence. For such assistance please contact your local Quarles & Brady attorney or: