California employers use background investigations to obtain useful information about prospective candidates. An applicant’s criminal background is part of that process. However, employers must understand the legal parameters of obtaining and using criminal history.

When to Obtain Criminal History

State and local governments have passed a variety of laws and ordinances that prohibit or limit employers’ consideration of an applicant’s criminal history before making a conditional offer of employment. These laws are called “ban the box,” because they usually require employers to remove criminal history questions from job applications. The underlying reason for “ban the box” is that employers’ instant rejection of applicants, based on a “yes” answer on the application, screens out otherwise qualified minority applicants, who statistically are more likely to have a criminal conviction.

“Ban the box” applies statewide in California beginning on January 1, 2018. Assembly Bill 1008, signed by the Governor this fall, prohibits California employers with five or more employees from asking about an applicant’s criminal history until after making a conditional job offer.

Assembly Bill 1008 is added to existing federal and state laws regulating background checks. We summarize the various requirements below.

How to Obtain Criminal History

There are various ways employers may obtain criminal history. Each has its own set of regulations. First, employers may search available public records. To do so lawfully, employers must provide the applicant a copy of the records within seven days, unless the applicant waives the right (usually, by checking a box on a standard form). Even in the case of an employee waiver, the employer must provide the record if takes an “adverse action” based on it (e.g., rescinds the employment offer).

More commonly, employers use third-party background investigation companies to obtain criminal records, often after extending an offer. There are stringent notice and disclosure requirements that apply under existing federal and state laws, as well as under AB 1008. Also, employers must follow certain rules for notifying applicants when they intend to take “adverse action” (i.e., rejecting the applicant) based on the records.

What Information to Obtain

Employers should be aware what criminal history information they are legally permitted to obtain. Most employers may not obtain information about arrests that do not result in a conviction. An exception to the law permits employers to ask applicants whether they are currently out on bail or released on their own recognizance pending trial. However, that exception does not permit employers to obtain related records.

Employers are also excluded from obtaining certain information, including referral to or participation in a retrial or post-trial diversion program; convictions that have been sealed, dismissed, expunged, or statutorily eradicated; and juvenile convictions. Certain exceptions apply to employers required by law to obtain this information.

What to Do With Criminal History Information

Once employers receive criminal history information, they must understand what to do with it. For example, a criminal record may relate to a crime that occurred long ago, or one that is not particularly related to the position.

Assembly Bill 1008 mandates that when an employer receives criminal history information, it must make an “individualized assessment” as to whether the conviction has a “direct and adverse relationship” with the duties of the job that would justify denying the applicant the position. The assessment must take into account the nature and gravity of the offense or conduct, the time that has passed since the offense or conduct and completion of the sentence, and the nature of the job held or sought. The assessment may be, but is not required to be, in writing.
This “individualized assessment” requirement is not a new concept. For example, the federal Equal Employment Opportunity Commission (the agency that enforces employment discrimination laws) has existing written guidance on this issue that also instructs employers to conduct individualized assessments.

However, AB 1008 adds an additional component. When an employer makes a preliminary decision to disqualify an applicant based on criminal history, it must notify the applicant in writing. The writing must notify the applicant of the disqualifying conviction or convictions; provide a copy of the conviction history report (if any); provide an explanation of the applicant’s right to respond (including informing the applicant that the response may include evidence challenging the accuracy of the report, evidence of rehabilitation or mitigating circumstances, or both); and provide the applicant at least five business days to respond before the employer makes a final decision.

The employer must consider the information provided by the applicant, if any. If it decides not to hire the applicant based solely or in part on the applicant’s criminal history, it must notify the applicant writing of the final denial, any internal procedure to challenge the decision, and the applicant’s right to file a complaint with the California Department of Fair Employment and Housing. The employer is not required to justify or explain its reasoning, but it may do so.

What to Do Now

Employers who have criminal history questions on their job applications should remove the questions now. Managers and others involved in the hiring process must be trained not to ask about criminal history during the application process.

If an employer wishes to ask applicants about criminal history, it should create a separate form for this purpose, provided only after a conditional employment offer. Additionally, the form should be limited to the types of information an employer is legally entitled to obtain, as described above. Finally, it should provide the applicant the opportunity to explain.

If an employer decides not to hire based on criminal history information disclosed by the applicant or obtained through a proper post-offer background investigation, the employer must follow the process required under California law to conduct an individualized assessment of the crime and its relationship to the job, notify the applicant in writing that it intends to rescind the offer, provide the applicant the opportunity to respond, and take that response into account in deciding how to proceed.

Finally, employers using third party services must ensure that forms and procedures used to collect all background information, including criminal history, comply with the federal Fair Credit Reporting Act and analog state law. Assembly Bill 1008 does not alter those laws’ requirements.