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California State Employment Laws

The state of California, including various cities and counties within the state, have restrictions on what can be reported in a background screening report beyond what the Fair Credit Reporting Act (FCRA) dictates.

RestrictionExplanation
Applicant/subject cannot be required to pay for a background check or a portion thereofTechnically, California law states that an employer cannot compel or coerce an employee or applicant to purchase anything of value. The law further states this includes when an employer provides, accepts, or processes an application to an applicant. Although there is no specific mention of a background check, recent case law has determined that an employer could not pass the cost of a background check after an application has been accepted.

See the statute here for more information.
Ban the Box: Use of criminal record only after a conditional offer of employmentEffective Jan. 1, 2018. With the signing of California law AB 1008, by Gov. Brown Oct 14, 2017 ban-the-box now applies to all employers in the State of California with more than 5 employees. The provisions of this new law are not beyond the norm for the typical ban-the-box. This law does not supersede any local law, therefore, Los Angeles, San Francisco, etc. requirements are still in force. Also per the bill, an employer cannot deny an applicant a position solely or in part because of conviction history until the employer performs an individualized assessment of each individual considering the following issues: nature and gravity of the offense, how long ago the offense occurred, and the nature of the job (job-relatedness of the offense). These are the regular EEOC standards, so nothing new for employers to consider. The employer is not required to make or present to the applicant a written assessment.

See the statute here for more information.
Ban-the-Box: Los AngelesLos Angeles is on the long list of cities including, San Francisco (which also includes Restrictions placed on landlords of Affordable Housing - See that separate Restriction) that have enacted their own version of Ban-the-Box. The law went into effect on Jan 22, 2017. In general, an employer [located or doing business within Los Angeles and has 10 or more employees] cannot inquire into the applicant’s criminal history until after a conditional offer of employment has been made. The LA ordinance defines a conditional offer of employment as an Employer’s offer of Employment to an Applicant conditioned only on an assessment of the applicant’s Criminal History, if any, and the duties and responsibilities of the employment position.
Cost of Medical Examination for Background Screening Cannot be Paid by Subject/ApplicantAn employer cannot require applicant to pay for pre-employment medical examination expenses.

See the statute here for more information.
San Francisco: Employment Restriction on Private EmployersPENDING: This August 2014 law is subject to change on October 1, 2018, for the city and county of San Francisco. Per the 2014 law: an Employer may not require applicants or potential applicants for employment or employees to disclose, and shall not inquire into, the person's conviction history or an unresolved arrest until either after the first live interview with the person (via telephone, video-conferencing, use of other technology, or in person) or after a conditional offer of employment. Restrictions are also placed on landlords of Affordable Housing.

See the statute here for more information.
Must Provide NoticeNew regulations issued by the California Department of Fair Housing and Employment became effective on July 1, 2017. The regulations really contain very little impact beyond current California or EEOC law. In general, the regulations outline the very difficult issue of adverse action discrimination. Basically, this is the process that results in unintentional discrimination. An employer uses certain hiring criteria, which could be education, requirements to have a license, strength, experience, whatever the employer believes will make for a good employee. Every hiring criterion in the world of employment must be justified as job-related. Some hiring criteria will adversely affect minority groups. The employer now must be able to justify that having a high school diploma is necessary for the job, not just the employer’s preference. Let us assume that it is determined that a high school diploma is in fact necessary. The next step in the adverse action analysis is whether there are less discriminatory alternatives that will achieve the same results for the employer. In our example, maybe having a GED is enough, or giving the applicants a test to see if they have the skills necessary for the job that supposedly the high school diploma would supply.

Keep these decision stages in mind: Hiring criteria > adverse impact > necessary for job > any alternatives > decision.

See the statute here for more information.

Notable exceptions: The regulations do not have the Los Angeles requirements of written analysis for each employee. The regulations also acknowledge that some laws, state and federal, prohibit the hiring of people with certain convictions.
Prohibits salary history inquiry during the hiring processEffective Jan.1, 2018, CA employers may no longer ask job applicants about their salary history. In addition, an employer cannot rely on an applicant’s past salary as a factor in determining whether to offer employment or in determining what salary to offer. This law is part of, Labor Code Section 432.3. A big issue is an employer may not: "...orally or in writing, personally or through an agent, seek salary history information, including compensation and benefits, about an applicant for employment". This prohibition is absolute - no post-offer, post-employment inquiries are allowed either.

See the statute here for more information.

Notable exceptions: The are two exceptions: 1) a prospective employer may consider an applicant’s pay history in determining th4 offered salary if the applicant voluntarily offers salary history without prompting. If so, the prospective employer still may not ask additional questions about the applicant’s compensation or benefits history, such as requesting copies of W-2s related to prior employment or other documents. 2) Pay history may be considered if it is publicly available under federal or state law, such as through California’s Public Records Act or the federal Freedom of Information Act.
Ban-the-Box Provisions: State Public EmployeesFOR PUBLIC EMPLOYERS ONLY: A state or local agency can not ask an applicant for employment to disclose (orally or in writing) information concerning the conviction history until the agency has determined the applicant meets the minimum employment qualifications, as per stated in any notice issued for the position.

See the statute here for more information.

Notable exceptions: This law does not apply to a position for which a state or local agency is otherwise required by law to conduct a conviction history background check, or to any position within a criminal justice agency, or to any individual working on a temporary or permanent basis for a criminal justice agency on a contract basis or on loan from another governmental entity.
Use of a conviction for a prior crime (included marijuana use) or non-annulled crimeEmployers may not ask or consider certain convictions involving 28.5 grams (1 oz.) of marijuana that are more than 2 years old.

See the statute here for more information.
Use of arrest record with no convictionEmployers may not ask or consider non-conviction matters except pending matters OR any participation in any pretrial or post-trial diversion programs. This includes a Deferred Sentence or Adjudication Withheld.

See the statute here for more information.
Use of Credit ReportAs of January 1, 2012, employers shall not use consumer credit reports for employment purposes unless the person is or will be employed in certain positions. Click on "Exceptions" link for a list of these positions. Unlike other state statutes, CA law requires the consumer to be informed on the authorization and consent form that a consumer credit report is being sought and for which listed positions which allow such a report to be stated. Thus, the employer must either fill in a blank or select from a checklist on the form. The latter choice would seem to create an undesirable lengthening of the form. The CRA could confer with its California clients that order credit reports and determine if they have permitted position and then “pre-fill” the form to list the permitted position. This is the first credit report restriction statute that has a practical application which requires the CRA to confer with the end user.

See the statute here for more information.

Notable exceptions: These positions excepted: (1) A managerial position, which has all the following characteristics: duties involve managing the business or department thereof; directing the work of at least two people; having authority to hire/fire or has real input on these decisions; uses discretion and independent judgment in performing the job; primarily performs exempt work under the Fair Labor Standards Act; earns twice the California minimum wage for full time employees which would equate, at this time, to $2,733.33 per month or $33,278.00 per year to be a management employee. (2) Employees of CA Dept of Justice. (3) Police/law enforcement officers: (4) When credit report information is required by law. (5) Has access to banks/credit card information, SSN and DOB of persons (routine processing of credit card purchases not included). (6) Has signatory authority on bank/credit cards of the employer. (7) Has authority to transfer funds on behalf of the employer. (8) Has authority to enter into financial contracts on behalf of the employer. (9) Has access to confidential proprietary information of employer. (10) Has regular access to cash of $10,000 or more of the employer, customer or client. (11) Positions with any financial institution subject to 15 U.S.C. §§6801-6809 [Disclosure of Non-Public Personal Information] either directly or indirectly through other federal or state statutes or regulations.
Use of Juvenile recordAn employer may not inquire regarding any juvenile proceeding or adjudication. or asking a job applicant to disclose information concerning certain juvenile records occurring while that person was subject to juvenile court law.

See the statute here for more information.
Use of Sexual Offender DataEmployers may not ask or consider Sex offender information unless the employer has people “at risk.”

See the statute here for more information.
Use of Social Media Password InformationAn employer shall not require or request an employee or applicant for employment to 1) Disclose a username or password for the purpose of accessing personal social media; 2) Access personal social media in the presence of the employer; 3) Divulge any personal social media. See Exceptions.

See the statute here for more information.

Notable exceptions: This law is not applicable when the act is relevant to an investigation of allegations of employee misconduct or employee violation of applicable laws and regulations (providing if used strictly for the purpose of the investigation).
Use or inquiry of sealed, expunged, pardoned or erased recordsEmployer may not ask about or consider any conviction that has been judicially dismissed or sealed.

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