California “Ban-the-Box” Law Significantly Limits Employers’ Ability to Obtain and Use Information About Criminal Convictions in Recruiting and Hiring

Just six months after California modified its regulations concerning past criminal convictions for applicants, California has taken the additional step of modifying the Fair Employment and Housing Act (“FEHA”) to expressly prohibit employers from inquiring about an applicant’s criminal history prior to a conditional offer of employment, and strictly limiting an employer's use of an applicant’s criminal history following a conditional offer.

New Process for Criminal Background Checks

Under the amendments to the FEHA, which are effective as of January 1, 2018, the following conduct is now prohibited before an employer makes a conditional offer of employment:

• Including in any application (whether written or oral) any question that seeks the disclosure of an applicant’s conviction history;
• Considering an applicant’s conviction history;
• Considering, distributing, or disseminating information about any of the following while conducting a conviction history background check in connection with any application for employment: (1) arrest not followed by conviction (except as provided in Labor Code § 432.7(a)(1) and (f)); (2) referral to or participation in a pretrial or post-trial diversion program; and (3) convictions that have been sealed, dismissed, expunged, or statutorily eradicated pursuant to law.

Once the employer extends a conditional offer of employment, the employer may conduct a background check and obtain a record of the applicant’s criminal history. If the criminal record reveals information that inclines the employer to reject the applicant solely or in part because of the applicant’s conviction history, the employer must make an individualized assessment of whether the conviction history would have a direct and adverse relationship with the specific duties of the job. In making that assessment, the employer should 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.

In essence, the employer must determine whether there is any relevant connection between the job duties and the offense, taking into consideration the seriousness of the offense and when it occurred. The employer may, but is not required to, memorialize the assessment in writing.

If the employer makes a preliminary determination that the offense is disqualifying, the employer is required to notify the applicant in writing. The notification must include:

• 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.

After the notification is provided, the applicant has five days within which to respond. If the applicant notifies the employer that he or she disputes the accuracy of the conviction and that the applicant is taking steps to obtain evidence to support that assertion, the applicant has an additional five days to respond to the notice. The employer must consider any information or evidence the applicant submits before making a final decision.

If, after going through this process, the employer still chooses to disqualify the candidate solely or in part because of the conviction history, the employer must notify the applicant of all of the following:

• The final denial or disqualification;
• Any existing procedure the employer has in place for the applicant to challenge the decision or request reconsideration; and
• A notification of the applicant’s right to file a complaint with the DFEH.

Next Steps

• Employers with 5 or more employees in California should review their employment applications, recruiting policies and procedures and ensure they comply with the new requirements.
• Given the law’s aim to limit an employer’s ability to pull an offer because of criminal history, employers should consider whether and when they will continue to run background check for certain positions altogether. To the extent that they do continue to run background checks,
• Employers should also prepare internal procedures to ensure that they follow the law’s notification and disqualification process properly in the event that they learn of a prospective employee’s disqualifying conviction.
• California employers who also have employees elsewhere, such as in New York City, should understand how each of those jurisdiction’s ban the box laws differ in any material way from California’s law. Understanding those differences can mean the difference between implementing a uniform policy and one that requires slight variations to ensure universal compliance.
• California employers must also remember to comply with the Federal Fair Credit Reporting Act (and related California laws) when running a background check.
• Note: This new law does not apply to positions for which an employer is required to perform a conviction history background check.

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