California’s Department of Fair Employment and Housing

Effective January 1, 2018 California employers can no longer ask an applicant for employment to disclose information about criminal convictions.  The new law (added as Section 12952 to the Government Code) applies to employers with 5 or more employees.  Once an offer of employment has been made, employers can conduct criminal history background checks, but only when the conviction history has a “direct and adverse relationship with the specific duties of the job,” and requires certain disclosures to the applicant if employment is denied based on the background check.  This Friday’s Five covers five areas of the new law that California employers should be aware of when hiring employees:

1. Employers may not include on any application for employment “any questions that seeks the disclosure of an applicant’s conviction history.”

2. Employers may not inquire into or consider this conviction history of the applicant, including any inquiry about conviction history on any employment application, until after the employer has made a conditional offer of employment to the applicant.

3. Employers can only research certain areas of an applicant’s background after a conditional offer has been made.

Employers may not “consider, distribute, or disseminate information” relating to any of the following areas when conducting a conviction history background check:

(A) Arrest not followed by conviction, except in some limited circumstances set forth in Labor Code section 432.7.

(B) Referral to or participation in a pretrial or posttrial diversion program.

(C) Convictions that have been sealed, dismissed, expunged, or statutorily eradicated pursuant to law.

4. If an employer intends to deny employment based on the applicant’s conviction history, it must make an “individualized assessment” if the conviction history “has a direct and adverse relationship with the specific duties of the job.

In making his determination, the employer shall consider all of the following:

(i) The nature and gravity of the offense or conduct.

(ii) The time that has passed since the offense or conduct and completion of the sentence.

(iii) The nature of the job held or sought.

The employer is not required to records these results of this individualized assessment in writing. However, employers that also must comply with local city and county background checks must be careful to follow those requirements as well.  For example, Los Angeles’ ordinance requires that employers provide this assessment in writing to applicants. 

5. If the employer preliminary disqualifies the applicant based on a conviction history, the employer is required to provide written notice to the applicant.

The notice must contain all of the following items:

(A) Notice of the disqualifying conviction or convictions that are the basis for the preliminary decision to rescind the offer.

(B) A copy of the conviction history report, if any.

(C) An explanation of the applicant’s right to respond to the notice of the employer’s preliminary decision before that decision becomes final and the deadline by which to respond. The explanation shall inform the applicant that the response may include submission of evidence challenging the accuracy of the conviction history report that is the basis for rescinding the offer, evidence of rehabilitation or mitigating circumstances, or both.

The applicant then has five business days to respond to the notice before the employer makes a final decision.  If the employee responds within this time limit, and states that they dispute the accuracy of the conviction history report and is in the process of obtaining evidence to support their position, the applicant will have an extra five business days to respond.  The employer must consider the information provided by the applicant before making a final decision.

If the employer makes a final decision denying the applicant employment solely or in part because of the applicant’s conviction history, the employer is required to provide a written notice to the applicant containing the following:

(A) The final denial or disqualification. The employer may, but is not required to, justify or explain the employer’s reasoning for making the final denial or disqualification.

(B) Any existing procedure the employer has for the applicant to challenge the decision or request reconsideration.

(C) The right to file a complaint with the Department of Fair Employment and Housing.

In addition to this new law, California employers need to be sure they are in compliance with the Federal Fair Credit Reporting Act (FCRA) and the California Investigative Consumer Reporting Agencies Act (ICRAA) when conducting any background checks.

The EEOC recently disclosed its fiscal year 2015 performance report.  The report is a good reminder to employers of the issues that they may likely face EEOC scrutiny.  Here are five key statistics employers should pay attention to:

1.     EEOC obtained more than $525 million in discrimination suits. 

Of this amount, the parties settled disputes for $356.6 million, and obtained $65.3 million through litigation.

2.     “Systemic” discrimination investigations and litigation.

The EEOC resolved 268 “systemic investigations” of discrimination claims prior to litigation, resulting in more than $33.5 million in settlements.  Systemic discrimination is defined by the EEOC as discrimination that “involves a pattern or practice, policy, or class case where the alleged discrimination has a broad impact on an industry, profession, company or geographic area.”  Some examples of “systemic” discrimination provided by the EEOC are discriminatory barriers in recruitment and hiring, discriminatory restricted access to management trainee programs and to high level jobs, and exclusion of qualified women from traditionally male dominated fields of work.  A list of recent cases provided on the EEOC’s website illustrates some examples: Outback Steakhouse settles $19 million suit for sex bias claims by women in a “glass ceiling” suit; Albertson’s settles $8.9 million suit alleging job bias based on race, color, and national origin.

The agency did not disclose how much it obtained in litigation, but it disclosed that it resolved 26 systemic cases.  Six of those included at least 50 plaintiffs, and 13 that included at least 20 plaintiffs.

3.      EEOC’s training programs. 

The agency claims to have reached 336,855 people through providing 3,700 educational, training and outreach evetns.  The agency’s Training Institute trained over 12,000 people at 140 events that “focused on the agency’s Strategic Enforcement Plan (SEP) priorities, including small businesses, vulnerable workers, underserved geographic areas and communities….”

4.     Number of charges filed with EEOC remained relatively unchanged from 2014. 

The EEOC received 89,385 in FY 2015.  This is slightly up from the 88,778 charges received by the agency in FY 2014.  This is down from the number of charges filed in 2013 (93,727 charges).

In 2015, the agency resolved 44% of its conciliations, which are mediations conducted by the EEOC to resolve employment disputes.

5.     EEOC litigation efforts.

The agency filed 142 lawsuits alleging discrimination for FY 2015.  Of the lawsuits, 100 were individual lawsuits and 42 were cases “involving multiple victims or discriminatory policies (versus discriminatory treatment), of which 16 were systemic suits.”  During 2015, the agency resolved 155 lawsuits alleging discrimination, and has 218 active cases.  Of these active cases, 48 (22%) alleged systemic discrimination and 40 (18%) were “multiple-victim cases.”

 

California employers must remember that the EEOC is a federal agency responsible for enforcing Federal discrimination laws.  California employers also need to comply with California discrimination laws, which are enforced through California’s Department of Fair Employment and Housing (DFEH).  Wage complaints are handled through the federal Department of Labor or California’s Labor Commissioner.