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Complying with the California Fair Chance Act

If you employ 5 or more and use a criminal background check, make sure you are complying with Federal and California law.


Most employers using a third-party to conduct criminal background checks are aware of the requirements under the Fair Credit Reporting Act (FCRA). This is a federal law that regulates the collection of consumers' credit information and access to their credit reports. It was passed in 1970 to address the fairness, accuracy and privacy of the personal information contained in the files of the credit reporting agencies. And its requirements apply to background checks for employees.



However, California employers also need to be aware of the Fair Chance Act. If an employer plans not to hire someone based on the criminal background check, it must first perform an "individualized assessment" to determine if the candidate's specific offense is relevant to the job. You need not provide this to anyone—rather, you retain this written, individual assessment in the event you are ever challenged. Moreover, there are some criminal records that cannot be the basis for this decision. Specifically, records that cannot be used, unless the employer meets one of the exceptions to the rules, are:


· Arrests that did not lead to a conviction.

· Nonfelony marijuana convictions that are older than two years.

· Juvenile records.

· Diversions and deferrals.


If the employer makes a preliminary decision that it might not hire the applicant based on the background check, it must send a "pre-adverse action notice" to the applicant. The pre-adverse action notice must identify the conviction at issue and include a copy of the background report. The notice must inform the applicant of his or her right to respond before the decision is finalized. Also, the employer must state that the applicant may dispute the accuracy of the criminal history and that the candidate may provide evidence of rehabilitation or mitigating circumstances.


The employer must give the applicant a reasonable amount of time to respond. Specifically, the applicant must be given at least five business days to make an initial response as to whether or not he or she is disputing or otherwise challenging the decision. If the applicant notifies the employer that he or she challenges the accuracy of the information and is gathering evidence, the applicant must be given at least another five business days to respond with that evidence.


If the applicant provides additional information, the employer must consider it before making a final decision. If the employer decides not to hire the applicant based on the background check, then it must inform the candidate in an adverse action notice. In it, the employer must notify the applicant of what background check company it used. And, the candidate must be notified of the right to file a complaint with the Department of Fair Employment and Housing.


As for the decision not to hire being based on checking employee references and the applicant's job history, and that screening is what caused the decision to withdraw the offer, then the above process is not required. Rather, best practices would be to call the applicant and inform them that the job offer is being withdrawn due to having conducted a screening of their employment history and references. And then sending a confirming letter indicating as such.


You want to make it clear to them that this screening was the result of the rescinding the conditional job offer, and not leave it open ended so it implies something else.

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© 2019 Hein, Esq.       418 B Street, 4th Floor, Santa Rosa, CA 95401        707-921-3913        justin@heinesq.com

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