Jun 22, 2015

Employers Beware: New York City “Bans the Box”

On June 10, 2015, the New York City Council passed the Fair Chance Act (“FCA”) that “bans the box” and places significant restrictions on an employer’s ability to look into an employment applicant’s criminal history at all stages of the hiring process. “The box” is the box found on many job applications which applicants must check to indicate if they have a prior criminal conviction. In passing the legislation, New York City joins a growing list of cities and states that have “banned the box” over the past few years.  Mayor de Blasio publically voiced his support for the FCA and is expected to sign it shortly.  The FCA will go into effect 120 days after signing, so employers should immediately review and revise their hiring process to ensure a smooth transition.

Current City and State Law:

Current laws prohibit New York City employers from discriminating against potential hires based upon their prior criminal conviction(s).  Specifically, an employer cannot reject a potential hire based upon their prior conviction unless: (1) there is a direct relationship between the conviction and the open position, or (2) hiring would pose an unreasonable risk to property or the safety or welfare of specific individuals or the public.

FCA Restrictions on Employer Inquiries:

The FCA takes the current law to a new level and places what is essentially a total ban on inquiries into an applicant’s criminal history from posting an opening until the employer makes a conditional offer of employment.  At the first stage of the hiring process, the FCA prohibits employers from posting an opening that “expresses, directly or indirectly, any limitation, or specification in employment based on a person’s arrest or criminal conviction.”  Until a conditional offer of employment is made, the FCA also prohibits any “inquiry” into an applicant’s pending arrest or criminal conviction record.  “Inquiry” is broadly defined as “any question communicated to an applicant in writing or otherwise” and includes: (1) questions on the job application, (2) questions posed to the applicant during the interview process, and, perhaps most significantly, (3) searches of public records and consumer reports that contain criminal background information.  The FCA has several exemptions, most notably, employers may take actions pursuant to local, state, or federal laws that require criminal background checks or bar employment based on criminal history.  Violation of the act may subject employers to penalties including punitive damages and injunctive relief.

Post Conditional Offer Inquiry and Adverse Employment Action:

Once a conditional offer has been extended, employers may make an inquiry into a potential hire’s criminal history.  However, employers are not completely out of the woods.  If the employer discovers information that it intends to use for an adverse employment action, the FCA requires that employers follow a strict notice procedure. The New York City Commission on Human Rights (the “Commission”) has not yet set the specific requirements for the notice procedure, but the FCA outlines the basic process an employer must follow when it intends to take an adverse action based on information it discovered during its inquiry.

First, the employer must provide a written copy of the inquiry to the applicant in a manner not yet set by the Commission.  Second, the employer must conduct a multifactor, case-specific analysis under State Correction Law Article 23-A, and provide the applicant with a written copy of the analysis that must include the reason for the employer’s pending decision.  Under Article 23-A, an employer must consider several factors including: (1) the public policy of New York to encourage the employment of persons previously convicted; (2) the specific duties and responsibilities related to the employment sought by the applicant; (3) the bearing, if any, the criminal offense or offenses will have on the applicant’s fitness or ability to perform one or more such duties or responsibilities; (4) the time that has elapsed since the occurrence of the criminal offense; (5) the age of the person at the time of occurrence of the criminal offense; and (6) the seriousness of the offense.  After conducting the Article 23-A analysis, the employer must provide the applicant with three business days to respond and hold the position open during the interim.

The Bottom Line:

Employers with locations in New York City should immediately begin to review and revise their hiring practices to comply with the almost guaranteed signing of the FCA to ensure a smooth transition.  Employers should also ensure that their decision-makers understand the new law and avoid any inquiry (including a simple internet search) into an applicant’s criminal history and pending arrests until a conditional offer of employment is extended.

To learn more or if you have any questions regarding these issues, please contact your labor and employment counsel at Smith, Gambrell & Russell, LLP.

This client alert is intended to inform clients and other interested parties about legal matters of current interest and is not intended as legal advice.

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