The City of San Francisco recently adopted stringent new rules that govern how employers may consider criminal background checks during the hiring process.  The Fair Chance Ordinance, No. 17-14, becomes operative for San Francisco businesses on August 13, 2014.  The new rules cover all businesses with at least 20 employees located or doing business in San Francisco, and apply to both paid and unpaid employment.  Below is a summary of the new law.

What Employers Cannot Consider:  Employers may not inquire about, require disclosure of, or base an adverse action in whole or part on:

  1. Arrests not leading to convictions except under limited circumstances;
  2. Participation in a diversion or deferral of judgment program;
  3. Convictions that have been rendered inoperative, such as via a judicial dismissal;
  4. Convictions or other adjudications in the juvenile justice system;
  5. Convictions that are more than seven years old; or
  6. Information pertaining to an offense other than a felony or misdemeanor.

What Employers May Consider, and When:  Employers may require disclosure of or inquire about a conviction history or unresolved arrest (other than those specified above) after either (1) the first live interview via phone, video, or in person; or (2) making a conditional employment offer.

Notice Requirements:  Before inquiring about a conviction, the employer must provide the applicant with notice specified by Article 49, Section 4905(b) of the Police Code, including a summary of the matters that may not be considered by the employer under any circumstances, a description of the restrictions on considering a conviction history, information about the applicant’s right to provide evidence of mitigating factors to the employer, and contact information for the San Francisco Office of Labor Standards Enforcement (“OLSE”).  In addition, before ordering a background check, the employer must comply with federal and state requirements and must provide notice to the applicant that it is ordering the background check.

After considering the conviction history but before making a decision, the employer must conduct an “individualized assessment” in which it considers only “directly-related” convictions – that is, whether the conviction has a direct, specific, negative bearing on the applicant’s ability to perform the duties necessarily related to the job.  The employer must also consider “evidence of inaccuracy” of the conviction as well as evidence of rehabilitation and mitigating factors.

If the employer intends to base an adverse action on the conviction history, it must provide the applicant with a copy of the background check, and notify him or her of the action and the basis for the action.  The applicant then has seven days to provide the employer with notice of evidence that the report is inaccurate.  The employer must delay the adverse action for a “reasonable period” in order to reconsider it in light of the new information. Ultimately, if the employer takes an adverse action based upon the conviction history, it must notify the applicant of the final adverse action.
Employers must also “publish and make available” notice under Section 4905(b) as described above.

Enforcement and Penalties:  The rules provide for administrative enforcement by the OLSE and civil enforcement by the City.  In the latter case, penalties include reinstatement, back pay, the payment of benefits or pay unlawfully withheld, the payment of an additional sum as liquidated damages in the amount of $50.00 to each person whose rights under the article were violated for each day such violation continued or was permitted to continue, injunctive relief, and attorney’s fees and costs.

Keesal, Young & Logan Employment Group

This information has been prepared by Keesal, Young & Logan for informational purposes only and is not legal advice. Transmission of the information is not intended to create, and receipt does not constitute, an attorney-client relationship between you and Keesal, Young & Logan. You should not act upon this information without seeking professional counsel.