The Iowa Supreme Court recently issued a ruling on the city of Waterloo’s ban the box ordinance—also known as the Fair Chance Initiative Ordinance.
The ordinance originally went into effect on July 1, 2020 after a lawsuit filed by the Iowa Association of Business and Industry was dismissed. The lawsuit alleged that the ordinance conflicted with a state law passed in 2017 that bans cities from putting restrictions on business' hiring practices.
Under that original ordinance, employers with 4-14 employees were prohibited from asking about criminal history on an employment application, while employers with 15 or more employees were also prohibited from:
- Inquiring into or requiring disclosure of criminal history on an employment application or during the interview process
- Running a background check until after a conditional offer is extended
- Making an adverse hiring decision based solely on an individual’s arrest record or pending criminal charges that have not yet resulted in a conviction.
- Making an adverse hiring decision based on criminal records that were expunged, erased, received an executive pardon or which were otherwise legally nullified.
- Making an adverse hiring decision based on an individual’s criminal record without a legitimate business reason.
What Stayed the Same
In the ruling, the Iowa Supreme Court upheld the provision that prohibits employers with more than 15 employees from asking about criminal histories on job application. Inquiring into criminal history can only take place after a conditional job offer has been extended. This remains the same for employers with 4-14 employees as well.
What Changed
The court struck down the portion of the ordinance that prohibits employers from making an adverse hiring decision based solely on an applicant’s criminal records and found that those portions of the ordinance conflicted with existing state law.
Reminder
While this ruling loosens requirements on employers, they should still proceed carefully when evaluating background checks that contain criminal information. As a reminder, the EEOC issued guidance in 2012 on the ‘Consideration of Arrest and Conviction Records in Employment Decisions’ which notes that employers should evaluate background checks on an individualized basis, taking into consideration several factors such as: the nature and gravity of the offense; the time that has passed since the offense, conduct and/or completion of the sentence; and the nature of the job held or sought.