California’s Fair Chance Act—also commonly referred to as the state’s “ban the box” law—is a statewide law that is meant to ensure that workers with previous criminal history are more fairly considered for employment. The law impacts both the timing of the criminal history question and the way in which employers evaluate candidates based on criminal history information. The Fair Chance Act is part of California’s employment anti-discrimination statute called the Fair Employment and Housing Act (FEHA), which is enforced by the Department of Fair Employment and Housing (DFEH). Although the Act originally went into effect January 1, 2018, new regulations went into effect October 1, 2020 that employers should be mindful of.
It is unlawful for private or public employers with five (5) or more employees to inquire into on an employment application or consider criminal history information until after a conditional offer. If an employer is considering taking adverse action based on the criminal history results, there are several steps they must follow:
Additionally, the new regulations expanded the scope of who the law applies to. Union hiring halls and labor contractors are required to comply with the regulations, and it explicitly states that “a labor contractor or union hiring hall may not decline to admit a worker to a pool or availability list, discontinue a worker’s inclusion in a pool or availability list, or decline to refer a worker to a position with a client employer, because of the worker’s criminal history unless the labor contractor or union hiring hall has complied with the procedures and requirements” set forth by The Fair Chance Act. The same requirements apply if the labor contractor or hiring hall re-conducts inquiries into criminal history.
Although the Fair Chance Act generally prohibits employers from considering referral to or participation in a pre-trial or post-trial diversion program, the updated regulations clarify that it is permissible for employers to consider these programs as evidence of rehabilitation after a conditional offer has been made provided the applicant submits the information to the employer.
Lastly, the regulations clarify how employers that are “required by any state, federal, or local law to conduct criminal background checks for employment purposes or to restrict employment based on criminal history” are affected (for example, professions in education and healthcare). Although it is permissible for these employers to ask about criminal history without first making a conditional job offer, they are still prohibited from asking about information such as an arrest or detention that did not result in conviction or a conviction that has been judicially dismissed or ordered sealed. However, use of such criminal history, either during the application process or during employment, must still not be used in a discriminatory way.
Employers are also reminded that they are required to comply with California’s version of the Fair Credit Reporting Act and any other local laws or city ordinances that provide additional limitations.
The Department of Fair Employment and Housing (DFEH) also issued an updated FAQ resource regarding The Fair Chance Act. Given the recent spotlight this existing law has received, employers should review their hiring policies and documentation to ensure they are in compliance.
Summary of The Fair Chance Act
Before addressing the regulatory updates, let’s revisit what the Fair Chance Act is and how the law works:It is unlawful for private or public employers with five (5) or more employees to inquire into on an employment application or consider criminal history information until after a conditional offer. If an employer is considering taking adverse action based on the criminal history results, there are several steps they must follow:
- First, employers must conduct an individualized assessment as to whether the conviction history has a direct and adverse relationship with the specific duties of the job that justify denying the applicant the position. This includes consideration of the nature and gravity of the offense, the amount of time that has passed since the conviction, and the nature of the job being sought.
- Next, employers must notify the individual in writing of the preliminary decision. This notification has several specific requirements including (but not limited to) providing notice of the disqualifying conviction(s) that is the basis for the preliminary decision. Employers must provide applicants the chance to respond with five (5) business days before making a final decision. If the applicant disputes the accuracy of the information, then the applicant must be provided with an additional five (5) business days.
- If a final decision is made, the employer must notify the applicant in writing and include any existing procedure they have 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.
Updates Effective October 1, 2020
The new regulations expanded the definition of “applicant” to include individuals who have been conditionally offered employment but begin working while “an employer undertakes post-conditional offer review and consideration of criminal history.” The regulation further states that “an employer cannot evade the requirements of this regulation by having an individual lose their status as an ‘applicant’ by working before undertaking a post-conditional offer review of the individual’s criminal history.”Additionally, the new regulations expanded the scope of who the law applies to. Union hiring halls and labor contractors are required to comply with the regulations, and it explicitly states that “a labor contractor or union hiring hall may not decline to admit a worker to a pool or availability list, discontinue a worker’s inclusion in a pool or availability list, or decline to refer a worker to a position with a client employer, because of the worker’s criminal history unless the labor contractor or union hiring hall has complied with the procedures and requirements” set forth by The Fair Chance Act. The same requirements apply if the labor contractor or hiring hall re-conducts inquiries into criminal history.
Although the Fair Chance Act generally prohibits employers from considering referral to or participation in a pre-trial or post-trial diversion program, the updated regulations clarify that it is permissible for employers to consider these programs as evidence of rehabilitation after a conditional offer has been made provided the applicant submits the information to the employer.
Lastly, the regulations clarify how employers that are “required by any state, federal, or local law to conduct criminal background checks for employment purposes or to restrict employment based on criminal history” are affected (for example, professions in education and healthcare). Although it is permissible for these employers to ask about criminal history without first making a conditional job offer, they are still prohibited from asking about information such as an arrest or detention that did not result in conviction or a conviction that has been judicially dismissed or ordered sealed. However, use of such criminal history, either during the application process or during employment, must still not be used in a discriminatory way.
Employers are also reminded that they are required to comply with California’s version of the Fair Credit Reporting Act and any other local laws or city ordinances that provide additional limitations.
The Department of Fair Employment and Housing (DFEH) also issued an updated FAQ resource regarding The Fair Chance Act. Given the recent spotlight this existing law has received, employers should review their hiring policies and documentation to ensure they are in compliance.