Rules Interpreting NYC “Ban the Box” Law Take Effect on August 5, 2017

Earlier this year, the New York City Commission on Human Rights (the “Commission,” or “NYCCHR”) promulgated a set of rules (the “Rules,” available here) relating to employers’ duties under the Fair Chance Act (the “FCA,” or the “Act”). The Act, which is more commonly known as New York City’s “Ban the Box” legislation, prohibits employers from inquiring about job applicants’ criminal conviction history before those applicants receive conditional offers of employment. While the Act itself has been in effect since 2015, the Rules will take effect on August 5, 2017. Employers covered by the Act, which includes out-of-state employers who publish postings for job openings in New York City, are well advised to review their practices concerning criminal background checks to ensure they are in compliance with the Rules.

Summary of the Act’s Key Provisions

As summarized in our prior client alert (available here), the FCA applies to employers with employees in New York City unless  those employers are required to conduct criminal background searches by local, state or federal law or statute, or by the rules of a financial self-regulatory organization (such as the SEC or FINRA). Also excluded from the Act’s requirements are employers hiring for positions within law enforcement agencies. The Act prohibits covered employers from inquiring about applicants’ criminal conviction histories prior to the extension of a conditional offer of employment. This prohibition extends to general announcements in job postings, inquiries on job application forms, and questions during the interview process.

The FCA also sets forth procedures that employers must follow in the event that they choose to withdraw a conditional offer of employment based upon information in a criminal background check. Specifically, the Act requires employers to take into consideration the factors outlined in Article 23-A of the New York State Correction Law (“Article 23-A”) to reach a conclusion as to whether the applicant’s criminal conviction history precludes employment because of either (i) a direct relationship between the applicant’s criminal conviction history and the job duties in question or (ii) an unreasonable risk to people or property. The Act further requires employers to provide the applicant with a copy of the background check report “in a manner to be determined by the Commission,” an analysis of the factors enumerated in Article 23-A also “in a manner to be determined by the Commission,” and an opportunity to respond to those documents before the conditional offer of employment is withdrawn.

Additional Guidance Provided by the Rules

Per Se Violations

The Rules create a category of “per se violations,” which are defined as “an action or inaction that, standing alone, without reference to additional facts, constitutes a violation of [the FCA], regardless of whether any adverse employment action was taken or any actual injury was incurred.” Such per se violations include:

1. Including any reference whatsoever to criminal convictions or criminal background checks in job postings, advertisements or other publications;
2. Including inquiries concerning criminal conviction histories in job application forms, even if NYC applicants are advised that there is no need for them to respond to the inquiry;
3. Referring to an applicant’s criminal conviction history in any way prior to the extension of a conditional offer of employment;
4. Failing to comply with the procedural notice requirements in the event of withdrawal of a conditional offer of employment because of information in an applicant’s criminal conviction background report; and
5. Seeking information about arrests that did not result in a criminal conviction.

In the event that the Commission identifies a per se violation, it may initiate an “Early Resolution Process” in which the employer admits liability and pays a fine based upon the size of the employer and the number of prior violations. The fine ranges from $500 to $3,500 for initial violations to $1,000 to $10,000 for subsequent violations. 

Procedure For Withdrawing Conditional Offers of Employment

The Rules also provide detailed guidance on the process by which employers may withdraw conditional offers of employment based on information in an applicant’s or employee’s criminal conviction history report. Prior to withdrawing a conditional offer of employment, an employer must:

• “[P]rovide a complete and accurate copy of each and every piece of information relied on to determine that the applicant has a conviction history,” including but not limited to Internet search results, third-party reports, and “written summaries of oral conversations.” 
• Provide a written copy of the analysis conducted pursuant to Article 23-A. While employers are under no duty to use the form drafted by the Commission for this purpose (available here), the analysis provided “must (1) include specific facts that were considered pursuant to the Article 23-A analysis and the outcome, (2) articulate the employer’s, employment agency’s, or agent’s concerns and basis for determining that there is a direct relationship or an unreasonable risk, and (3) inform the applicant of their rights upon receipt of the notice, including how they can respond to the notice and the time frame within which they must respond.”
• Provide the applicant with a reasonable period of time (which must be three days or longer) in which to respond to the report. In this process, the employer “must affirmatively request information concerning clarification, rehabilitation, or good conduct while engaging in the Article 23-A analysis.” The Rules also contain a detailed protocol concerning the employer’s duty to hold the position open while the applicant gathers this information. 
• Consider any additional information provided by the applicant and provide a written final determination addressing any such additional information provided.

Miscellaneous Provisions

The Rules also address a variety of ancillary issues, including but not limited to the following:

• Employer responses to an applicant’s voluntary disclosure of information about his or her criminal conviction history in an interview (the employer is to refrain from soliciting additional information or relying on the information that the applicant voluntarily disclosed);
• Online search terms that employers are to refrain from using in conjunction with an applicant’s name prior to the extension of a conditional offer of employment (including “mugshot,” “warrant”, “jail” and “prison”); and
• Duties imposed by the Act and the Rules concerning businesses that use “temporary help firms” for short-term employment.

The Rules also provide that, “[i]f a background check reveals that an applicant has intentionally failed to answer a legitimate question about their conviction history, the employer, employment agency, or agent thereof may revoke the conditional offer or take an adverse employment action.” An employer wishing to revoke a conditional offer of employment on these grounds would nonetheless need to follow the protocol set forth in the Act and the Rules. 

Practical Advice

Because the FCA has been in effect since 2015, most covered businesses that conduct criminal background checks in connection with personnel decisions are likely to have policies and practices in place to comply with the Act. Such businesses should nonetheless review those policies and practices to ensure that they comply with more detailed requirements set forth in the Rules. The NYCCHR’s stated policy is to “vigorously enforce” the Act – and it is anticipated that the Rules will provide the Commission with more fertile grounds to do so.