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Wisconsin Court of Appeals Clarifies the Scope of Arrest Record Discrimination
By Attorney Storm B. Larson, Boardman & Clark LLP

Employers covered by the Wisconsin Fair Employment Act (WFEA) are generally prohibited from discriminating against individuals on the basis of their arrest and/or conviction records, subject to certain exceptions. There are key differences in the analysis depending on whether a "conviction" or an "arrest" record is at issue. Generally, employers have more leeway to consider conviction records and are extremely restricted in considering arrest records when making employment decisions.

However, employers may generally discharge or refuse to hire an individual based on the individual's arrest record if, through the employer's independent investigation of the conduct underlying the arrest, it concludes that the individual did commit the conduct for which the individual was arrested. This procedure is often referred to as an "Onalaska investigation" because it was established by the Court of Appeals in a 1984 decision in Onalaska v. LIRC, 120 Wis. 2d 363. Employers that rely on this procedure in court are often referred to as raising the "Onalaska defense." The Onalaska defense is not available when employers are concerned about an employee's conviction record.

In Vega v. LIRC, the Wisconsin Court of Appeals clarified the scope of the Onalaska defense and held that deferred entries of judgment/deferred prosecution agreements qualify as arrests and not convictions under the WFEA. Thus, the employer in Vega was allowed to terminate an employee who had two deferred prosecution agreements for felony sexual assault after it interviewed the employee and concluded he had engaged in the conduct (the employee admitted to the conduct). This case marks an important development because it clarifies that deferred prosecution agreements are "arrests" because no final determination of guilt has been made through these agreements.

As Vega demonstrates, the lack of a final determination as to guilt makes the deferred prosecution agreements qualify as arrests rather than convictions. Furthermore, Vega confirms that the Onalaska defense will continue to apply only to an individual's arrest record and not an individual's conviction record. Employers must be cautious when approaching issues of an employee's or applicant's criminal history. Getting proper counsel on these issues before commencing an investigation or talking to the candidate or employee is critical to ensure compliance with Wisconsin's complex law.

More information on how arrest and conviction records should be treated can be found here: https://www.boardmanclark.com/publications/hr-heads-up/recent-development-on-arrest-record-discrimination-and-the-onalaska-defense

And here: https://www.boardmanclark.com/publications/hr-heads-up/wisconsin-supreme-court-addresses-substantial-relationship-test-for-arrest-and-conviction-record-discrimination

We encourage employers to reach out to your legal counsel with questions.

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