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When employees are arrested during their off-duty time and away from work, employers may need to make difficult choices balancing their various obligations. Among these are respecting the rights of arrested employees, ensuring the safety of workforces and workplaces, maintaining the continuity of business operations, and preserving brand integrity and corporate reputation—as well as considering how state and federal laws might relate to the conduct at issue and to any decision to retain, suspend, or discharge arrested employees. As with most things, process and risk assessment matter, and the way that decision-makers meet the moment may make the difference between an optimal outcome and an outcome that subjects employers to liability. Here are four questions and answers for employers weighing their options in these situations.

Question 1. When an employee is arrested outside of work hours, how can an employer know if it is permissible to discharge the individual?

Answer 1. How an employer responds to an individual arrest is most likely going to be controlled by state or local law. Almost all U.S. states have at-will employment, meaning that an employer may discharge an employee at any time, for any reason that is not prohibited by law, or when the at-will presumption has not been modified by contract. A limited number of states have laws that limit what an employer may do upon receiving information about an employee’s arrest. For example, the Wisconsin Fair Employment Act prohibits discrimination on the basis of arrest or conviction record. Within this law, there is a defense that may apply and allow an employer to respond if the arrest is substantially related to the circumstances of the particular job. Arrest record discrimination is a type of protected category that multistate employers operating in a state like Wisconsin may sometimes overlook. The details of a state law governing discrimination on the basis of arrest record will control what, when, and how an employer may respond if it learns of an employee’s arrest.

Federal law does not directly protect an individual from discrimination based on an arrest or conviction. However, arrest-related issues may still arise under federal law when a blanket policy related to arrests or an employer practice differs for some groups of employees. For example, if an employer always or consistently discharges employees upon news of an arrest, that policy or practice could have an effect where individuals of a certain protected category (e.g., race, national origin, gender, disability, or religion) are disproportionately excluded from employment opportunities. Similarly, if an employer in practice regularly gives one group of employees a warning for an arrest outside of work but establishes a pattern of terminating from employment another, protected group of employees, those circumstances could also give rise to a violation of federal law.

Q2. If an arrest occurs outside of an employee’s work hours, does the nature of the alleged underlying conduct (e.g., violent or nonviolent) that gave rise to the arrest affect the analysis or scope of the employer’s options under consideration?

A2. The answer here largely depends on the applicable state or local law that prohibits discrimination based on an employee’s arrest or arrest record. Generally, the state laws that apply to these types of circumstances permit an employer to take action if the conduct leading to the arrest is related to what the employee does on the job. For example, a bank would likely be able to discharge or exclude from a teller position an employee arrested for theft, even in those states that prohibit discrimination based on an arrest. Where the relationship between the job and the alleged criminal violation at issue is less obvious, however, a closer examination of the employee’s job duties and the employer’s business necessity may be warranted.

Q3. How or to what extent does the potential for reputational harm to the business factor in to an employer’s decision about whether to discharge, suspend, discipline, or refrain from taking adverse action with regard to an arrested employee?

A3. This is often part of the balance that any business will likely have to take into account when deciding how to respond to news of an arrest when a state or local law protects employees on the basis of arrest record. An employer presented with news of an employee’s highly publicized arrest for a controversial crime may, in the totality of the circumstances, determine that the risk of a legal claim arising from the employee’s discharge is outweighed by the risk of reputational harm arising from the public’s reaction to learning that the employee continues to be employed. Ultimately, having weighed all other relevant considerations (e.g., workplace safety), the employer assessing the risk to its reputation has to decide if the employment liability risk or the potential for public relations harm presents the greater risk.

Q4. What other options, short of employment termination, might exist for an employer that is considering not discharging an arrested employee?

A4. This assessment is highly dependent on the circumstances. In some cases, if local law allows it, an employer might consider imposing a suspension pending the results of the criminal system’s processing of the arrested employee. In the right circumstances, that option may mitigate the public relations risk or harm to employee morale until there is some clarity about the outcome of the criminal proceedings.


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