SHRM Foundation Head Addresses Lawmakers on Second-Chance Hiring

Urges DOL to promote tax credit for hiring people with criminal histories

Roy Maurer By Roy Maurer June 16, 2021
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Wendi Safstrom

​Wendi Safstrom testifying before a U.S. House Education and Labor Subcommittee

​Wendi Safstrom, executive director of the SHRM Foundation, testified before a congressional panel about the nonprofit's work on second-chance hiring and presented policy recommendations to lawmakers to help individuals with criminal records re-enter and thrive in the workplace.

Safstrom addressed members of the U.S. House Education and Labor Subcommittee on Higher Education and Workforce Investment on June 15. Congress is considering reauthorization of the Workforce Innovation and Opportunity Act (WIOA), the law that governs the nation's workforce development system.

She spoke about the SHRM Foundation's Getting Talent Back to Work initiative and advocated support for the federal government's Reentry Employment Opportunities (REO) program, which provides skills training and helps people with criminal records transition back into society, as well as the Work Opportunity Tax Credit (WOTC), which incentivizes employers to hire formerly incarcerated job seekers.  

"SHRM and the SHRM Foundation are committed to working with Congress to find responsible solutions to bringing the formally incarcerated into the workplace," Safstrom said. "In the United States, 1 in 3 adults has a criminal record and each year nearly 700,000 people are released from prison. Unfortunately, this population experiences an unemployment rate five times the national average. Without employment, reintegration into society will be extremely difficult for them, and many will find themselves back behind bars as a result."

According to recent SHRM research, 66 percent of HR professionals indicated they would be willing to work with job seekers who have criminal records—up from less than half who felt this way in 2018—and 53 percent said they would be willing to hire individuals with criminal records, up from 37 percent in 2018.

Safstrom told the panel that one of the most effective and least utilized solutions to addressing equity gaps is to actively recruit and retain people left out of consideration for employment due to biases and misconceptions, including those with criminal records.

"Unnecessary barriers to employment for individuals who have completed a period of incarceration or who have a criminal record create societal problems where citizens are deprived of employment opportunities and organizations are deprived of qualified talent, creating harmful downstream consequences for millions of people," she said.

She added that HR professionals understand the business case and social imperative for hiring people with criminal records. "Second-chance hiring can be a key component of an organization's DE&I [diversity, equity and inclusion] strategy, as HR professionals recognize that diverse teams result in more innovation, faster problem-solving, better engagement and increased financial performance."

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Getting Talent Back to Work

Safstrom shared with the committee the progress made under the Getting Talent Back to Work campaign, which launched in 2019. She described it as "a call to action for the business community, asking CEOs, HR executives and industry leaders to publicly pledge to consider qualified individuals with criminal histories for employment." 

The program provides HR with tools, research and expert advice to help hire candidates from this untapped talent pool.

In late December 2020, the Foundation relaunched Getting Talent Back to Work with a new digital toolkit of practical resources; public relations strategies; an organizational self-assessment tool; and a 10-hour HR certificate program meant to help recruit, hire, retain and advance people with criminal records.

"Since the release of the original toolkit in 2019, Getting Talent Back to Work has helped connect over 20,000 users to the relevant resources needed to develop and implement strategies that provide equitable opportunities to individuals with criminal records," Safstrom said.

She also told the lawmakers about SHRM's leadership in the Second Chance Business Coalition, a cross-sector group of large employers committed to expanding hiring and advancement practices to people with criminal records.

The SHRM Foundation also is planning partnerships with community-based organizations to build a Getting Talent Back to Work Employment Ecosystem.

Safstrom said planning is underway to unveil a pilot program with the city of Charlotte, N.C., in collaboration with the Center for Community Transitions, a nonprofit group founded to help reduce recidivism.

"Through this pilot, by establishing and working with partners from state and local workforce development agencies, employers and HR professionals and community-based organizations will test a framework that can be evaluated and scaled pending efficacy and outcomes," she said.

Policy Recommendations

Safstrom offered recommendations to the committee as members work on reauthorizing WIOA.

She said the Department of Labor (DOL) should evaluate all program providers or grant recipients based on employment, earnings and recidivism reduction. "Intervention strategies that have demonstrated promise, such as subsidized or transitional employment, should be prioritized," she said.

Safstrom encouraged the committee to prioritize subsidized employment opportunities targeting high-risk people in any authorization of the REO program and said it is essential to ensure that REO-supported grant recipients have a close relationship with HR professionals responsible for candidate recruitment and assessment.

"HR professionals have access to the latest labor market data, play a critical role in identifying potential job candidates, and understand any licensure or legal barriers that may preclude an individual with a criminal record from pursuing a career in a particular occupation or industry," she said.

Safstrom also emphasized the importance of promoting the WOTC incentive to better support re-entry into the labor market for people with criminal records. The WOTC provides employers a tax credit for hiring people with specific barriers to employment. Employers are eligible for a credit up to $2,400 based on a former felon's earnings and hours worked in the first year of employment.

"Unfortunately, the variability and temporary nature of the WOTC tax credit affects the ability of employers to fully incorporate it into their hiring strategies," she said. While the tax credit has been extended through fiscal year 2025, Safstrom said, Congress should consider making it permanent. "Additionally, the DOL could do more to promote awareness of the tax credit, as the availability of the credit could play a significant role in the number of employers who intentionally recruit justice-involved individuals as part of their human capital management strategies."

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