Employer Sued for Alleged NYC Fair Chance Act Violations

New York City is home to perhaps the most complicated and enforced ban the box law – the Fair Chance Act (FCA). Over the past several years, the New York City Commission on Human Rights (NYCCHR) has enforced the law’s many requirements against employers. More recently, we’re also starting to see private lawsuits filed against employers alleging violations of the FCA.

In one recent suit filed in March 2021, the plaintiff alleged he received notice from the prospective employer in early December 2020 that included a copy of a background report and instructions to contact the consumer reporting agency if any information was inaccurate. The plaintiff claimed his “prospects of being hired by [the prospective employer] had been decimated” and that he received no further contact following this letter.

The plaintiff alleged the prospective employer violated the FCA by obtaining a criminal background report prior to extending a conditional offer. Further, the plaintiff cited language included in the prospective employer’s letter which stated: “If accurate, the information contained in the Report in whole or in part will significantly affect our decision regarding your potential for employment.” As alleged in the complaint, this language also violated the FCA since the FCA outlines that criminal history may only influence a hiring decision if there is a direct relationship between the conviction and the position sought, or the conviction poses an unreasonable risk to property or safety.

Employers impacted by the FCA are encouraged to review their processes in light of the many complexities layered into the law. As a reminder, a $1.8 million settlement was announced in September 2020 over allegations related to the FCA as well. It’s clear this is a hot area for enforcement and litigation so we recommend employers consult with qualified legal counsel on this issue.