New state laws are aimed at providing more opportunities for people with
criminal records, and HR must take note.
By Angela Preston
Today’s job market and social climate demands that HR professionals consider diversity and inclusion policies to ensure they are playing a positive role in addressing and eliminating systemic racism. This heightened focus is motivated in part by increased awareness of racial injustice in the U.S. and globally. Companies are looking for meaningful ways to diversify the workforce and end discriminatory practices. As companies begin to scrutinize their hiring processes to eliminate bias and increase equity, the question of criminal background checks is often part of the conversation. New state laws are aimed at providing more opportunities for people with criminal records, which is impacting the way employers conduct background screening.
The concern around discrimination and links to criminal history is not new. In 2012, the U.S. Equal Employment Opportunity Commission (EEOC) published its Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions under Title VII of the Civil Rights Act to counteract discrimination and disparate impact in the workplace. The guidance requires employers to consider whether criminal offenses are job related and consistent with business necessity prior to making employment decisions, and conducting an individualized assessment to afford an individual the opportunity to demonstrate that they should not be excluded based on more complete information and the specific circumstances.
Following the lead from the EEOC’s guidance, some state and local jurisdictions have incorporated similar and even more extensive standards as legal requirements. These requirements vary by jurisdiction and may include special notification requirements, restrictions on the types of criminal history inquiries (such as prohibiting inquiries into arrests or specified convictions), and the time frames they may cover (such as limiting inquiries to records within a specified number of years). At the state and local levels, these laws are often labeled Fair Chance, Second Chance, or Ban the Box laws.
What Exactly are Fair Chance Laws?
Ban the Box or Fair Chance laws are designed to remove barriers in hiring for individuals with criminal records. The intent of these laws is to mitigate discrimination based on an applicant or employee’s criminal history, thereby helping people obtain meaningful employment, reducing recidivism, and helping to reverse the trends of racial discrimination.
To be clear, state and local laws that encourage second chance hiring don’t prohibit criminal checks. However, they do require that employers delay questions about an individual’s criminal history until late in the hiring process. The idea is to remove potential bias that may come with a criminal history, and to allow other relevant job competencies to be evaluated first.
In addition to removing the checkbox on forms that applicants would check if they have a criminal record, in most cases these laws come with other requirements. Typically, employers must delay inquiries into an applicant’s criminal history until after a conditional offer has been extended, or sometimes after the completion of an initial interview. Additional notices and individualized assessments are often required as well.
According to the U.S. Equal Employment Opportunity Commission, individualized assessment generally means that an employer informs the individual that they may be excluded because of past criminal conduct; provides an opportunity to the individual to demonstrate that the exclusion does not properly apply to them; and considers whether the individual’s additional information shows that the policy as applied is not job related and consistent with business necessity.
The majority of states and over 150 local jurisdictions have adopted Ban the Box or Fair Chance hiring practices in the public sector, and more than 30 state and local jurisdictions have extended such requirements to private employers. Effective December 20, 2021, Ban the Box provisions will apply to federal agencies, as well as federal contractors. The Fair Chance to Compete for Jobs Act, signed into law in December 2019, prohibits such entities from requesting oral or written disclosures of applicants’ criminal history information prior to the extension of a conditional offer of employment for most positions. While delaying inquiries is not a universal requirement, the prevalence of these new initiatives speak to the desire for socially responsible business practices.
Evolving Policies and Screening Programs
As part of the cultural shift toward racial justice, initiatives designed to assist ex offenders with obtaining meaningful employment are expected to continue growing. Early into 2021, the start of a new legislative session for most states, more than a dozen states have introduced proposals to enhance fair chance practices in hiring, occupational licensing, and access to education.
To comply with existing and future requirements, HR professionals should regularly review their application forms, hiring criteria, and background screening processes in consultation with their legal counsel. Since this legislative and regulatory landscape is so volatile, staying abreast of changes and updates in the relevant locations is imperative. If there are workplace conditions and specific positions where certain categories of crimes would pose challenges or risks, hiring organizations should be prepared to define the job roles and the process for individualized assessment of candidates. HR professionals have an opportunity to expand their candidate pool to include strong options that they may otherwise miss out on, and positively contribute to the rehabilitation and socioeconomic mobility of ex-offenders in their community.
Keeping track of, let alone navigating these requirements, is challenging. It’s important to find industry partners to identify new legislation and rules, determine their impact, and be aware of upcoming obligations. Look for compliance tools that meet company requirements and enhance the fairness of processes. These include options like EEOC style individualized assessment workflows, New York City and Los Angeles specific Fair Chance workflows, and client matrix application tools, which apply client-established criteria to the results of consumer reports, to highlight only offenses that they have deemed relevant to promote consistent consideration and decision making.
Below are a few examples of jurisdictions with particular requirements related to the screening and consideration process. Please be advised that this is only a small sample to highlight distinct cases and are not comprehensive requirements for screening in those locations. Organizations should consult with legal counsel regarding comprehensive requirements in the jurisdictions where hiring is performed, and applicants reside.
New York, NY
The New York City Fair Chance Act, initially effective in 2015 and with subsequent guidance and amendments, includes Ban the Box provisions for applicable employers with four or more employees, and prohibits inquiries and consideration regarding non convictions. If an employer is considering an adverse employment decision, they must complete an individualized assessment utilizing the statewide standards of New York Correction Law Article 23-A on a form prescribed by the NYC Commission on Human Rights, and relay the reasons for any potentially adverse or adverse decisions in writing. In addition, amendments which take effect in July 2021 clarify that the Fair Chance process similarly applies to individuals with pending cases. New guidance, published in July 2021, clarifies the commission’s position that criminal background checks should take place after a conditional offer, after a candidate has passed other screening and has otherwise been qualified. It also provides further clarification on completing the Fair Chance process for employers.
Los Angeles, CA
The Los Angeles Fair Chance Initiative for Hiring Ordinance and its implementing rules took effect in January 2017, and apply to employers with 10 or more employees who work on average for at least two hours each week within the boundaries of the city. The ordinance includes a Ban the Box provision, reiterates the state prohibition on inquiring about or considering arrests that did not result in conviction, and requires an individualized assessment to be completed on a form prescribed by the city. If after the completion of the assessment, the employer decides to proceed with an adverse decision, they must complete a reassessment on the same form, explaining their reason for rescinding the conditional offer of employment.
Montgomery County, MD
The Montgomery County Fair Criminal Screening Standards Law, passed in 2014 and amended in 2020, applies to all employers in the county and is among the most extensive Fair Chance requirements in the country. In addition to Ban the Box provisions and requiring individualized assessments and identification of particular convictions at issue when considering adverse action, employers are limited on which convictions they may consider. Most employers are prohibited from requiring disclosure, inquiring about, or running background checks to determine arrests that did not result in conviction, first convictions for Trespass, Disturbance of the Peace, or Assault in the Second Degree under the Maryland Code, and convictions of misdemeanor offenses for which the conviction date and date that any period of incarceration ended is older than three years. Furthermore, when considering an adverse employment decision, employers must allow an individual seven days (greater than the federal Fair Credit Reporting Act “FCRA” standard of five days) to respond before making a final decision.
The Philadelphia Fair Criminal Record Screening Standards, which took effect in 2011 and has been subsequently amended several times (most recently in 2021) apply to employers who employ any persons in Philadelphia, and includes Ban the Box provisions and prohibits inquiries or adverse actions related to any non-pending arrests and non-convictions. Additionally, employers are limited to a seven-year lookback period and may only consider convictions that occurred within that timeframe, not including any period of incarceration. If an employer is considering and adverse employment decision due to an individual’s conviction history, an individualized assessment is required, and the employer must disclose the reason for potential disqualification. The individual must be allowed 10 days (greater than the FCRA standard of 5 days) to respond. The most recent amendments, effective on April 1, 2021, clarify that these Standards apply to current employees, including contractors, as well as applicants.
Angela Preston is senior vice president and counsel for corporate
ethics and compliance at Sterling.