New Background Check Laws

Several jurisdictions have enacted new or modified existing background check laws. Some of these regulations are listed below. We recommend a review of the current law in your locale to ensure compliance.

A Good Employee does not offer legal advice and the attached is for information purposes only.

California

California Background Check Laws

California has two state laws with which employers must comply when they retain the services of a third-party consumer reporting agency (CRA) to obtain consumer reports, such as background checks or credit reports as part of the hiring process.

California’s Investigative Consumer Reporting Agencies Act (ICRAA) (Cal. Civ. Code §1786, et seq.) governs the procurement and use of investigative consumer report[s], which are consumer reports in which information on a consumer’s character, general reputation, personal characteristics, or mode of living is obtained through any means. ICRAA requires employers procuring reports for employment purposes, other than suspicion of wrongdoing or misconduct by the subject of the investigation, to certify that it provided the employee or applicant a clear and conspicuous disclosure in writing, and that the consumer gave written authorization to obtain the report. Under ICRAA, an employer may be liable for actual damages or $10,000 per violation, whichever is greater, in addition to other damages, for failure to comply.

The California Consumer Credit Reporting Agencies Act (CCRAA) (Cal. Civ. Code §1785.1, et seq.) applies to “consumer credit report[s],” and expressly excludes character information obtained through personal interviews. CCRAA requires employers to provide written notice informing the employee or applicant that it will procure and use a credit report, and identify the specific basis under Labor Code Section 1024.5(a) for use of the report, but does not include a written authorization requirement.

Expanded Fair Employment and Housing Act (SB 1300): Employers will be prohibited, with certain exceptions, from requiring an employee to sign a release of claims under the Fair Employment and Housing Act in exchange for a raise or bonus, or as a condition of employment or continued employment. Employers are also prohibited from requiring an employee to sign a non-disclosure agreement that aims to deny the employee the right to disclosure of unlawful acts in the workplace, including sexual harassment.

Salary History (AB 2282): The Labor Code will now specify that employers may inquire about an applicant’s salary expectations for the position being applied for but not their salary history. Job applicants are entitled to a pay scale upon request, but only after completing an initial interview.

Defamation Protection (AB 2770): Under this bill, employers and victims of sexual harassment are protected from liability for defamation lawsuits for injury to an alleged harasser’s reputation after a complaint of sexual harassment has been made. An employee who makes credible reports of harassment will be shielded from liability, as will an employer who communicates with interested parties such as victims and witnesses. When contacted for a job reference about a current or former employee, an employer will now be permitted to reveal whether the individual is not eligible for rehire because the employer determined that he/she engaged in sexual harassment.

New Limits on Criminal Background Checks (SB 1412): Amends Labor Code section 432.7 to limit the exception for employers that are required by law to screen applicants using a criminal background check. The new law  permits inquiries about an applicant’s criminal history only to a “particular conviction” relevant to the position sought by the applicant. Inquiries into particular convictions are only permitted in the following situations:

• The employer is required by law to obtain information regarding the particular conviction of the applicant;
• The Applicant’s employment requires the possession or use a firearm;
• An individual with that particular conviction is prohibited by law from holding the position sought by the applicant;
• The employer is prohibited by law from hiring an applicant who has that particular conviction.

Oregon Clarifies Equal Pay Act

The majority of the provisions of Oregon’s Equal Pay Act went into effect on January 1, 2019. The Act prohibits employers from screening applicants, or pegging starting pay for new hires, based on salary history. Likewise, employers may not “seek” an applicant’s salary history, either from the applicant or from other employers. While employers may not confirm salary history before making an offer of employment, even if the applicant voluntarily discloses the information, an employer may confirm prior compensation after the employer makes an employment offer that includes compensation, as long as the employee provides authorization.

Beginning 2019, the Bureau of Labor and Industries (BOLI) will enforce the Act, including the inquiry ban, and employees and applicants may file claims with BOLI. However, employees and applicants may not pursue private actions against employers for alleged violations of the Act until January 1, 2024.

Some key provisions of the act:

An expanded protected class to include race, color, religion, sex, sexual orientation, national origin, marital status, veteran status, disability, and age;

A definition of compensation includes wages, salary, bonuses, benefits, fringe benefits and equity-based compensation., but does not include tips or reimbursement for any actual costs incurred including, but not limited to, relocation reimbursements, mileage, and out-of-pocket expenses. Benefits must be included in the measure of compensation, including for pay equity analyses, but an employer may offer different benefits to employees performing comparable work if, of course, the same options are offered to all workers performing comparable work.

“work of comparable character,” is defined by the Act as requiring substantially similar knowledge, skill, effort, responsibility, and working conditions regardless of job description or job title. which may help employers more precisely distinguish pay for differently skilled new hires and employees.  Examples are also given for “allowable pay differences.”  Some of these include seniority, merit system, and work location, among others.

Oregon employers should familiarize themselves with this new rule for additional clarification when it comes to the state’s Salary History Ban.

Westchester County, New York Bans the Box

Effective March 4, 2019:  Employers in Westchester County may not inquire into (in writing or otherwise), or make any statement related to, a criminal conviction or arrest record of any person in an employment application.

An employer may inquire about the applicant’s arrest or conviction record, however after the employment application has been submitted.  Prior to taking any adverse action based on such an inquiry, the employer must analyze the applicant’s criminal record.  If requested by the applicant, the employer must provide a written statement setting forth the reasons for the adverse action.

Suffolk County, New York Enacts Salary History Ban

Effective June 30, 2019:  Employers in Suffolk County, New York are prohibited from inquiring about a job applicant’s salary history at any time in the hiring process. Employers may not inquire about an applicant’s wage or salary history, including, but not limited to, compensation and benefits or rely on the salary history of an applicant for employment in determining the wage or salary amount at any stage of employment.

Hawaii Enacts Salary History Inquiry Law

Effective January 1, 2019, during the hiring process employers and their agents will be prohibited from:

• inquiring about an applicant’s salary history, whether by asking the applicant or inquiring through a current or former employer;
• searching public records or reports to ascertain an applicant’s salary history; and
• relying upon salary history to determine an applicant’s compensation at any time during the hiring process—including the negotiation of an employment contract—unless an applicant voluntarily discloses salary history information, in which case the information may be both verified by the employer and relied upon in setting compensation (subject to other applicable law).

The law does allow discussions about an applicant’s expectations with regard to salary, benefits and other compensation without inquiring about salary history.

New Hampshire Expands Protections Against Discrimination to Include Gender Identity

• The law makes it an unlawful for an employer to:
• refuse to hire or employ;
• bar or discharge from employment, or;
• discriminate against an individual on the basis of gender identity

in compensation or in the terms, conditions or privileges of employment, unless based upon a bona fide occupational qualification.

“Gender identity” is defined under the law as “a person’s gender-related identity, appearance, or behavior, whether or not that gender-related identity, appearance, or behavior is different from that traditionally associated with the person’s physiology or assigned sex at birth.”

Employers with operations in New Hampshire should review their policies and practices to ensure that gender identity is included amongst the protections against discrimination and harassment.

Connecticut Enacts Salary History Inquiry Law

Employers are prohibited from inquiring or directing a third party to inquire about a prospective employee’s wage history unless the prospective employee has voluntarily disclosed such information.

Employers are still permitted to inquire about other elements of a prospective employee’s compensation structure, such as how bonuses or other added compensation may occur as long as such employer does not inquire about the value of the elements.  This law would not apply if any federal or state law specifically authorizes the disclosure or verification of salary history for employment purposes.

Vermont Enacts Salary History Inquiry Law

Employers or their agents may not inquire about or seek information regarding an applicant’s current or past compensation from either the prospective employee or their current or former employer. The employer may not require that a prospect’s current or past compensation satisfy specific criteria, and cannot decide whether to interview a prospective employee based on his or her current or past compensation.

If, after receiving an offer of employment with compensation, the applicant voluntarily discloses current or previous compensation details, an employer may seek (or request from the applicant) confirmation of the compensation information provided.

Employers may inquire about a prospective employee’s salary expectations or requirements and/or provide details about the compensation package to the candidate.

Massachusetts Modifies “Ban the Box” Law

Massachusetts “Ban the Box” law prohibits employers from asking about any information related to a job applicant’s criminal record in the initial written application. In addition, employers are prohibited from requesting certain criminal record information from applicants at any point in the application process, even after receiving the initial written application. Specifically, employers may not request information from an applicant, either written or orally, regarding: (1) “an arrest, detention, or disposition regarding any violation of law in which no conviction resulted”; (2) a first conviction of a misdemeanor for “drunkenness, simple assault, speeding, minor traffic violations, affray, or disturbance of the peace”; or (3) any misdemeanor where the date of conviction or completion of incarceration “occurred five or more years prior” to the date of application for employment, unless the applicant has been convicted of any offense in that same period.

Employers are prohibited from asking applicants about any misdemeanor where the date of conviction or completion of incarceration occurred three (amended from five) years prior to the date of application unless the applicant has been convicted of any offense in that same period.

Employers are prohibited from asking applicants, either written or orally, about criminal records that have been sealed or expunged. At any point during the application process employers asking for criminal record information must include the following statement on the request form:

“An applicant for employment with a record expunged pursuant to section 100F, section 100G, section 100H or section 100K of chapter 276 of the General Laws may answer ‘no record’ with respect to an inquiry herein relative to prior arrests, criminal court appearances or convictions. An applicant for employment with a record expunged pursuant to section 100F, section 100G, section 100H or section 100K of chapter 276 of the General Laws may answer ‘no record’ to an inquiry herein relative to prior arrests, criminal court appearances, juvenile court appearances, adjudications or convictions.”