EEOC Office of Legal Counsel staff members wrote the following informal discussion letter in response to an inquiry from a member of the public. This letter is intended to provide an informal discussion of the noted issue and does not constitute an official opinion of the Commission.
ADA, Title VII, & ADEA: Work Opportunity Tax Credit, IRS Form 8850
July 28, 2010
This letter responds to your recent inquiry concerning whether the Internal Revenue Service (IRS) Form 8850 (the Form) for use in applying for the Federal Work Opportunity Tax Credit (WOTC) comports with the federal equal employment opportunity (EEO) laws enforced by the Equal Employment Opportunity Commission (EEOC or Commission). Specifically, you ask whether the EEOC’s position regarding employers’ use of the Form 8850 has changed since our last correspondence with you in 1997. As more fully set forth below, our position has not changed, and we continue to advise that proper employer use of IRS Form 8850 would not violate the EEO laws, most prominently Title I of the Americans with Disabilities Act (ADA).
As you know, the purpose of the WOTC is to encourage employers to hire and train people who are experiencing severe difficulties that are often linked to unemployment. For example, the WOTC program applies to individuals who have been long-term recipients of payments under the Temporary Assistance to Needy Families (TANF) program, and to individuals who have completed or are completing certain rehabilitative services. To qualify for the WOTC tax credit for hiring individuals in such circumstances, the WOTC law requires employers to obtain official confirmation of the job applicants’ WOTC status before offering employment. 26 U.S.C. § 51(d)(13) (Section 51).
You inquired about the EEOC’s position regarding employer use of the August 2009 version of the Form 8850. This recent version continues to include the 1990’s question about whether a job applicant qualifies for the WOTC under one of several familiar bases, such as TANF recipient or beneficiary of certain federal or state rehabilitation programs. In addition, the 2009 version of the Form asks, as a separate question, whether the job applicant has a service-connected disability. See IRS Form 8850, Box 4. The IRS added this separate question because Congress amended the WOTC statute in 2007 to “increase and expand” the tax benefit for employers who hire qualified disabled veterans.1 Section 51 now provides that employers may receive double the tax benefits for hiring veterans who are “entitled to compensation for a service-connected disability” and who meet certain other criteria. 26 U.S.C. §§ 51(b)(3) & (d)(3)(A)(ii). The WOTC requires that the employer make the decision to hire a qualified service-connected disabled veteran with knowledge that the veteran meets the statute’s requirements.
Americans with Disabilities Act, 42 U.S.C. § 12101 et seq. (ADA).
For the following reasons, employers’ use of the IRS Form 8850, in compliance with IRS requirements, remains lawful under the ADA.
ADA-covered employers are barred from making pre-offer disability-related inquiries. 42 U.S.C. § 12112(d)(2)(A). In the Commission’s ADA Enforcement Guidance: Pre-Employment Disability-Related Questions and Medical Examinations, 8 Fair Empl. Prac. Man. (BNA) 405:7191, 7192 (the Guidance), the Commission defined a disability-related inquiry as a question that is “likely to elicit information about a disability.”2 Because the new question added to the Form 8850 pursuant to the 2007 WOTC amendments focuses solely on whether the job applicant is a disabled veteran, it is likely to elicit information about a disability and therefore is a “disability-related inquiry.” Accordingly, it is subject to the ADA’s restrictions.
However, there is a relevant exception to the general ADA prohibition on pre-offer disability-related inquiries. Specifically, as explained in the Guidance:
An employer may invite applicants to voluntarily self-identify for purposes of the employer's affirmative action program if: the employer is undertaking affirmative action because of a federal, state, or local law including a veterans' preference law that requires affirmative action for individuals with disabilities (that is, the law requires some action to be taken on behalf of such individuals); or the employer is voluntarily using the information to benefit individuals with disabilities.
Id. at 7196-97. The Guidance further notes that applicants must be informed that the request for self-identification is voluntary (that is, the applicant need not disclose his or her status as an individual with a disability), and that the information provided will be used only for affirmative action purposes.
We believe that this exception applies to Form 8850’s question asking if the job applicant is a veteran entitled to compensation for a service-connected disability. As we understand it, the WOTC program operates as an affirmative action program in support of the hiring of certain individuals with disabilities. One goal of the program generally, and of the amended provisions supporting employment of service-connected disabled veterans specifically, is to increase the employment of persons with disabilities. Therefore, employers that choose to take advantage of the federal WOTC program and, consequently, use the Form 8850 on a pre-employment basis to identify for hire veterans with service-connected disabilities are “voluntarily using the [disability-related] information [they collect] to benefit individuals with disabilities.” Additionally, Form 8850 clearly informs job applicants that completion is voluntary and the customary practice of employers using the Form is to include it among other application documents for completion.3 If completion is in fact voluntary and the collected information is held confidentially, this ADA exception would apply to the inquiry.
In the past, we also have noted that Form 8850 finds support in the EEOC’s ADA regulation that provides for an “other Federal laws defense.” Specifically, in prior letters addressing Form 8850, we cited the section of the ADA regulation stating that “[i]t may be a defense to a charge of discrimination under this part that a challenged action is required or necessitated by another Federal law or regulation . . . .” 29 C.F.R. § 1630.15(e). Again, the WOTC requires employers to know whether an applicant falls into the service-connected disabled veteran eligibility category before making an offer of employment in order to receive the tax credit.4
Recognition that the Form’s inquiry falls within ADA exceptions does not, however, extend ADA protection to employers who misuse the information that the Form provides. An employer using the Form must understand that it will be obtaining disability-related information along with the WOTC information. Such information may not be used to make a discriminatory employment decision in violation of the ADA.
Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et. seq.
IRS Form 8850 does not put the employer in the position of violating Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination on the basis of race, color, religion, national origin or sex. Title VII does not expressly prohibit employment inquiries that disclose that an applicant is a member of a protected group. Form 8850 also does not ask whether an individual belongs to a particular Title VII protected group.
Age Discrimination in Employment Act (ADEA), 29 U.S.C. § 621 et. seq.
The request for the applicant’s date of birth if the applicant is under 40 years old does not violate the ADEA, as the ADEA does not expressly prohibit an employer from asking an applicant’s age. The Form requests this information in order to determine if applicants fit the eligibility requirements to be considered “summer youth employees” or “disconnected youth” for purposes of the WOTC. See IRS Form 8850 Instructions, p. 2. The EEOC’s ADEA regulations include a specific employment program exemption from “all prohibitions of the Act” for programs “carried out by the public employment services of the several States, designed exclusively…to encourage the employment of [various groups including] youth.” 29 C.F.R. § 1625.31. Additionally, because the ADEA only prohibits employers from discriminating against employees and applicants who are 40 years of age or older, none of the applicants who provide a birth date fall within the purview of the statute. 29 U.S.C. § 631.
We hope this information is helpful to you. Please note that this letter is an informal discussion of the issues you raised and is not an official opinion of the EEOC. If you have any questions or would like to discuss this or any related matter in more detail, you may reach me at 202-663-4645.
Carol R. Miaskoff
Assistant Legal Counsel
1 153 Cong. Rec. S6699 (May 24, 2007) (statement of Sen. Baucus). The amendment to the WOTC may be found at section 8211 of the Small Business & Work Opportunity Tax Act of 2007, which itself is a part of the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery & Iraq Accountability Appropriations Act, 2007, Pub. L. No. 110-28, 121 Stat. 112.
2 The Guidance is available on the EEOC web site at http://www.eeoc.gov/policy/docs/preemp.html.
3 The EEOC’s Guidance further provides that applicants should be further informed that the information will be kept confidential, that no adverse consequences flow from a decision not to provide the information, and that it will be used in a manner consistent with the ADA. The Form meets these requirements: it notes that the information is covered by the IRS confidentiality provision, 26 U.S.C. § 6103; the form advises applicants that completion of the Form is voluntary; and it informs applicants that the Form’s use is to “assist members of targeted groups in securing employment.”
4 Historically, in its 1992 Technical Assistance Manual on the Employment Provisions of the Americans with Disabilities Act, the EEOC noted that predecessor statutes to the WOTC necessitated pre-offer disability-related inquiries about job applicant eligibility status for the benefits that these statutes offered and that “[t]hese inquiries would not violate the ADA.” Technical Assistance Manual § 5.5(c) at V-9. (The EEOC has not put the Technical Assistance Manual on its web site. The Manual is available on the web site of the Job Accommodation Network (JAN) at http://www.jan.wvu.edu/links/ADAtam1.html. JAN is a free service from the Department of Labor's Office of Disability Employment Policy that provides, among other things, technical assistance regarding the ADA and specializes in providing individualized worksite accommodations solutions.)
This page was last modified on March 29, 2010.
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