Fair Credit Reporting Act & Background Checks – Part Three

More Cities and States Join the “Ban the Box” Movement


The first two parts of this series focused on employers’ obligations under the Fair Credit Reporting Act when conducting background checks and the rise in class action litigation. Part Three of this series shifts gears slightly to highlight another important issue for employers – “ban the box” legislation.

Ban the box, in the most traditional sense, refers to the removal of criminal history questions from an initial employment application. However, many of the ban the box laws passed extend beyond that traditional definition by banning criminal history questions (and in some cases the criminal background check itself) until after a conditional offer of employment, or extending additional requirements during the adverse action process. Employers that hire in multiple jurisdictions are particularly facing a complex landscape that will likely significantly impact the way many companies currently operate as it relates to the background screening process, particularly around criminal history information.

Recent Legislative Activity

In the first eight months of 2014, four cities and states have passed ban the box legislation impacting private employers. These jurisdictions join several others: Minnesota, Rhode Island, Hawaii, Massachusetts, Buffalo (New York), Newark (New Jersey), Seattle (Washington) and Philadelphia (Pennsylvania).

This article will address the newly passed legislation in San Francisco (California), Baltimore (Maryland), Rochester (New York), Illinois, and will also highlight the pending ban the box laws in New Jersey and Washington, D.C.

San Francisco, California

San Francisco in particular now has one of the most onerous ban the box laws in the country. Effective August 13, 2014, the “Fair Chance Ordinance” applies to any employer with 20 or more employees (regardless of if all 20 employees are located in the City). The Ordinance prohibits employers from inquiring into an individual’s criminal history convictions or unresolved arrests until after the first live interview (conducted via technology or in person) or after extending a conditional offer of employment. The Ordinance also extends beyond the criminal history inquiry to regulate what information employers may legally consider in an employment decision, such as convictions older than 7 years and an arrest that did not lead to a conviction.

Before inquiring into an individual’s criminal history, the employer must provide a copy of the Official Notice which must also be published in workplaces and job sites. Prior to making an adverse hiring decision, employers must conduct an “individualized assessment” process considering “Directly-Related Convictions”,[1] evidence of inaccuracy, rehabilitation or other factors, and the time that elapsed since the conviction or unresolved arrest at issue. The employer must also first provide the individual with a copy of the background report and notify the individual of the “items forming the basis for the prospective Adverse Action.” Essentially, the employer should follow the required two-step adverse action process under the FCRA, modifying the Pre-Adverse Action letter to identify the specific criminal history that might result in adverse action.

The employer must then provide a seven day waiting period for the individual to respond, or identify any inaccurate criminal history information. At that point, the employer must wait a “reasonable period” to make the final adverse action decision.[2] If the employer decides to take adverse action, a final notice must be sent to the individual.

Employers are also prohibited from publishing any job advertisements that directly or indirectly states that individuals with criminal history should not apply for employment; however, employers must state in job advertisements that qualified applicants with criminal histories will be considered in a manner consistent with the Ordinance’s requirements. Employers must also retain records of employment, applications and any other related data for a period of three years.

The Office of Labor Standards Enforcement (OLSE) is responsible for investigating alleged violations of the Ordinance and for issuing penalties, which include a warning for the first violation, an administrative penalty of up to $50.00 per impacted employee or applicant for the second violation and an administrative penalty of up to $100.00 per impacted employee or applicant for any subsequent violations. The City may also bring a civil action against the employer.

Baltimore, Maryland

Baltimore passed the “Fair Criminal-Record Screening Practices” Ordinance in May 2014, effective August 13, 2014. While Baltimore’s Ordinance is far less burdensome that San Francisco’s, there are still several important pieces of this legislation for impacted employers to know.

The Ordinance applies to employers with 10 or more full-time employees in the City, and prohibits employers from inquiring into criminal history information and from conducting the actual criminal background check before a conditional offer of employment has been extended. This part of the legislation in particular will impact any employers who conduct background checks earlier in the process (such as on the top three candidates pre-offer). Employers that have a legal requirement to conduct a criminal history inquiry or background check under an applicable federal, state or city law are exempted from the Ordinance, as are any employers or facilities servicing minors or vulnerable adults.

Individuals may file complaints with the Community Relations Commission which is responsible for investigating alleged violations and issuing penalties. The Commission may award back pay for lost wages, reinstatement, compensatory damages (which may include compensation for “humiliation, embarrassment, and emotional distress” and expenses incurred in seeking other employment) and reasonable attorney’s fees. Further, any person who violates any provision of the Ordinance is “guilty of a misdemeanor and, on conviction, is subject to fine of not more than $500 or imprisonment for not more than 90 days or both” for each offense. Finally, employers may not retaliate or otherwise discriminate against any individual that alleged a violation of the Ordinance.

Rochester, New York

Closely following the passage of Baltimore’s legislation, the Rochester City Council passed its ban the box legislation, effective November 18, 2014. Ordinance No. 2014-155 amends Chapter 63 of the Rochester Municipal Code with regard to “Fair Employment Screening”, and applies to any employer in the City that has 4 or more employees. Employees include seasonal, temporary, contingent or contracted work, or work through staffing or referral agencies.

Under the Ordinance, employers are prohibited from inquiring into an individual’s criminal history during the application process, which begins when the individual inquires into employment and ends when the employer has either conducted an initial interview (“any direct contact…whether in person or by telephone”) or extended a conditional offer of employment. If no interview is conducted, the employer must inform the individual that a criminal background check will be conducted before employment begins. Employers must also comply with Article 23-A of the New York State Corrections Law, the New York State Human Rights Law and the Fair Credit Reporting Act.

There are several exemptions under the Ordinance, including any employers who are prohibited under New York State or Federal law from employing individuals with certain convictions, the City Police or Fire Department and employers hiring for licensed trades or professions if the criminal inquiry is required by a licensing authority or New York State or Federal law.

The Ordinance grants individuals the opportunity to file civil lawsuits directly against the employer, and extends authority to the City’s Corporation Counsel to commence a lawsuit. The City Council has also published Frequently Asked Questions impacted employers should review.


Effective January 1, 2015, Illinois joins the ban the box movement with Public Act 098-077, the “Job Opportunities for Qualified Applicants Act.” This Act is one of the least invasive from an employer’s perspective, and applies to any employer in the state with 15 or more employees. Covered employers are prohibited from inquiring into, considering or requiring the disclosure of criminal history until an individual has been determined qualified for the position and has been selected for an interview (or has received a conditional offer of employment if no interview is conducted).

Several exemptions exist under the Act, including employers who are required to exclude individuals with certain criminal histories under state or federal law, employers who employ individuals licensed under the Emergency Medical Systems Act and where an individual’s conviction would disqualify him or her from obtaining a required standard fidelity bond or an equivalent bond.

The Illinois Department of Labor is tasked with investigating alleged violations and imposing penalties which range from a written warning to civil penalties of up to $1,500.

New Jersey & Washington, D.C.

New Jersey and Washington, D.C. have passed ban the box legislation that is awaiting approval by Governor Chris Christie and Mayor Vincent Gray respectively.

New Jersey has significantly scaled back its ban the box legislation, which began as one of the most restrictive and burdensome laws imposed on employers. The final version, A1999, “The Opportunity to Compete Act” is far more business-friendly, and prohibits employers from inquiring into criminal history during the initial employment application process (a previous version of the bill prohibited inquiries until after a conditional offer of employment). The final version also removes restrictions on what criminal history the employer may consider and requirements that the employer must make a good faith effort to discuss with the individual any questions or concerns pertaining to an his or her criminal history.

Washington, D.C. passed B20-0642, “Fair Criminal Record Screening Act of 2014”, which makes it an unlawful discriminatory practice for an employer (with 10 or more employees within D.C.) to inquire into, require disclosure of or take adverse action based on records of arrest that are not pending or did not result in a conviction. Employers are further prohibited from inquiring into criminal history (or taking adverse action) prior to extending a conditional offer of employment. Any conditional offer of employment may only be withdrawn if there is a “legitimate business reason” which takes into account several factors such as the time that has elapsed, the age of the person at the time of the offense and the specific duties and responsibilities of the position. If an offer is terminated, an individual may request from the employer within 30 days a copy of all records procured by the employer in consideration of the individual and a “written Statement of Denial” which outlines the legitimate business reason and advises the individual of his or her opportunity to file a complaint with the Office of Human Rights.


Employers are facing an increasingly challenging legal landscape as it relates to criminal history information. As cities and states continue to pass this legislation aimed at helping ex-offenders reintegrate to society, employers that hire in multiple jurisdictions will face administrative headaches both in terms of compliance and the act of tracking legislation. Given these challenges, employers are strongly encouraged to consult with qualified legal counsel on the options available for addressing ban the box compliance. Some of these options include removing the criminal history section from the hiring process and rewriting internal hiring policies to ensure adequate consideration of criminal history for all individuals. However, no option is going to be right for every organization, and it is important for employers to invest the time to evaluate what is right for their business and company culture.

In addition to ban the box laws, employers must be cognizant of ongoing activity by the Equal Employment Opportunity Commission following the release of its 2012 Guidance – “Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964”. Part Four of this series will explore the Guidance in detail, in addition to several ongoing lawsuits the EEOC has filed against employers alleging the use of criminal and credit information resulted in racial discrimination.

[1] As defined by the Fair Chance Ordinance, “Directly-Related Conviction” in the employment context shall mean that the conduct for which a person was convicted or that is the subject of an Unresolved Arrest has a direct and specific negative bearing on that person’s ability to perform the duties or responsibilities necessarily related to the employment position. The employer must consider whether the employment position offers the opportunity for the same or a similar offense to occur and whether circumstances leading to the conduct at issue will recur in the employment position.

[2] Although “reasonable period” is not defined under the Ordinance, presumably employers should wait until the dispute raised by the individual regarding accuracy is resolved. If evidence of rehabilitation or other mitigating factors are presented by the individual, employers are instructed by the Ordinance to reconsider the prospective adverse action in light of the information.

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