California Adopts State-Wide Restrictions on Criminal History Inquiries for Job Applicants

Governor Jerry Brown recently signed Assembly Bill No. 1008, which restricts how and when public and private employers can ask applicants about criminal history when applying for employment in California. The new restrictions will be added to California’s Fair Employment and Housing Act, and are effective January 1, 2018.  

California joins 29 states and over 150 U.S. cities which have enacted so-called “ban the box” ordinances prohibiting employers from requiring job applicants to disclose criminal history on their job application, and nine other states and 15 major cities, including San Francisco and Los Angeles, in enacting “fair chance” requirements concerning the use of criminal convictions in the hiring process. Our alert concerning the San Francisco Ordinance is here; and our alert concerning the Los Angeles Ordinance is here. The new state law adopts some, but not all, of the provisions of the San Francisco and Los Angeles Ordinances, and does not expressly preempt these ordinances. Employers hiring for positions in California will be required to comply with the new state law and current (and any potential future) local ordinances. 

AB 1008 prohibits private and public employers with at least five employees from:

• Including on any employment application any question that seeks the disclosure of an applicant’s conviction history;
• Inquiring into or considering conviction history before an applicant receives a conditional offer of employment;
• Considering, distributing, or disseminating any of the following while conducting a conviction history background check in connection with any application for employment: (1) an arrest that did not result in a conviction, subject to the exceptions in Labor Code § 432.7(a)(1) (arrests where an applicant is free on bail or on his or her own recognizance pending trial), and (f) (setting forth limited exceptions for health care facilities); (2) referral to or participation in a pre-trial or post-trial diversion program; and (3) convictions that have been sealed, dismissed, expunged or statutorily eradicated pursuant to law; and
• Interfering with, restraining, or denying the exercise of any right provided under the new law. 

Before an employer can withdraw a conditional offer and deny employment solely or in part because of the applicant’s conviction history, the employer must make an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with the specific duties of the job sought. The employer must consider all of the following:

• The nature and gravity of the offense or conduct;
• The time that has passed since the offense or conduct and completion of the sentence; and
• The nature of the job held or sought.

If the employer’s individualized assessment results in a decision to disqualify an applicant, the employer must notify the applicant of this preliminary decision in writing. The written notification of the preliminary decision must contain all of the following:

• Notice of the disqualifying conviction or convictions that are the basis for the preliminary decision to rescind the offer;
• A copy of the conviction history report, if any; and
• An explanation of the applicant’s right to respond to the notice of the employer’s preliminary decision before that decision becomes final and the deadline by which to respond. The explanation must inform the applicant that the response may include submission of evidence challenging the accuracy of the conviction history report that is the basis for rescinding the offer, evidence of rehabilitation or mitigating circumstances, or both.

The applicant must be provided at least five business days to respond. If within this initial period the applicant notifies the employer in writing that he or she disputes the accuracy of the report and is taking steps to obtain evidence supporting that assertion, the applicant must be provided five additional business days to respond to the notice.

The employer must consider any supplemental information provided by the applicant before making a final decision. If the employer’s decision remains unchanged, the employer must notify the applicant in writing of all the following:

• The final denial or disqualification. At the employer’s option, the denial may include an explanation of the employer’s reasoning for making the final denial or disqualification;
• Any existing procedure the employer has for the applicant to challenge the decision or request reconsideration; and
• The right to file a complaint with the Department of Fair Employment and Housing.

In addition to the new requirements set forth in this law, the California Fair Employment and Housing Council’s (“FEHC”) recent regulations regarding the use of criminal history for employment purposes also remain in effect. Our advisory on the recent FEHC regulations can be found here. 

Practical Impact

Employers with 5 or more employees should consider taking the following steps now to prepare for this new law:

• Review current job applications, and remove any request for disclosure of criminal convictions for California positions.
• Determine whether any California cities or counties in which the employer has operations have their own “ban-the-box” requirements that may be more stringent than those provided by the California state law.
• Review employment policies, job descriptions, job posting templates, and notices of adverse decisions to ensure compliance with the bill, and similar local laws.
• Adhere to the requirements of the federal Fair Credit Recording Act and California state equivalent, as well as any other federal, state, and local requirements, before conducting background checks and taking adverse action against applicants or employees based on their criminal history. Employers should also consider clarifying with background check providers what information should not be collected or reported in certain jurisdictions to avoid non-compliance with “ban the box” ordinances. Our recent advisories on FCRA compliance are located here and here. Establish a protocol to conduct individualized assessments of job applicants/employees with criminal histories, and consider how and when to review these decisions with inside or outside counsel.
• Establish procedures and develop forms to comply with individual notice, posting, and record-keeping obligations imposed by the ordinance.
• Train human resource professionals and hiring managers about the ordinance and its requirements, especially the requirement for an individualized assessment of criminal history for each applicant and the restriction on use or dissemination of this information (even if volunteered) before a conditional offer is made. Employers may want to consider designating a particular manager or HR professional to be the point person through which all requests for criminal history are made and evaluated, and to whom all questions are directed.

A copy of the bill can be found here.