Employers Need To Reevaluate Their Hiring Process to Ensure Compliance with Increasing Regulations on Inquiries into Applicants’ Criminal Records

Paula Lopez, September 18, 2014.

New Jersey has become the sixth state to enact “ban the box” legislation, restricting private employers within its state from inquiring into an applicant’s criminal record during the initial application process.  It is called the “Opportunity to Compete Act” and was signed into law by Governor Christie on August 11, 2014, but does not go into effect until March 1, 2015.  The version of the law that was passed is a compromise between the employers’ interests in making fully-informed hiring decisions and the goals of the law’s proponents in preventing otherwise qualified individuals with a criminal record from being considered for employment, thereby reducing the criminal justice system’s cost and the rate of recidivism.

New Jersey’s law applies to private employers with 15 or more employees, including employment agencies. The prospective employment must be “in whole, or substantial part” within New Jersey.  Generally, the law restricts employers from advertising for a position that solicits only applicants without criminal records and prohibits, during the “initial application process”, an employer from requiring an applicant to complete an employment application containing questions about an applicant’s criminal record and/or from inquiring, either in writing or verbally, about an applicant’s criminal record.  The ”initial application process” is defined as “the period beginning when an applicant for employment first makes an inquiry… about a prospective employment position or job vacancy or when an employer first makes any inquiry to an applicant for employment about a prospective employment position or job vacancy, and ending when an employer has conducted a first interview.”  The interview can be in person, telephonically, or through some other means.

Exceptions to the restrictions on an employer’s right to inquire about an applicant’s criminal record include: (i) when an applicant voluntarily discloses, in writing or verbally, that he or she has a criminal record; or (ii) the employer is hiring for (a) a position in law enforcement, corrections, judiciary, homeland security or emergency management, (b) a position where a criminal history background check is required by law, rule or regulation, (c) a position where an arrest or conviction may preclude the applicant from being hired, and/or (d) an employer’s ability to engage in business activities is restricted based on the criminal records of its employees.

New Jersey’s law does not create a private cause of action.  The Commissioner of Labor and Workforce Enforcement is charged with enforcing the law.  An employer who violates any provision of the law is subject to a $1,000 civil penalty on a first violation, $5,000 civil penalty on a second violation, and a $10,000 civil penalty for a third or subsequent violation.  After the “initial interview process” is complete, an employer is free to inquire about an applicant’s criminal record and can refuse to hire an applicant based on his or her criminal record.  The caveat of course is that an employer cannot refuse employment based on a past criminal record that has been expunged or erased through executive pardon, and is still required to comply with other applicable laws and rules regarding the consideration of arrests and convictions in the hiring process.  The law preempts any conflicting laws previously passed by any county or municipality in New Jersey.

In New York, Article 23-A of the State Corrections Law prohibits any public agency or private employer (with 10 or more employees) from taking adverse employment actions based on a prior criminal conviction unless there is a direct relationship between the prior offense and the position, or there is a threat to the property, safety or welfare of individuals or the public at large. Rochester and Buffalo have passed their own “ban the box” legislation that goes further than Article 23-A and New Jersey’s law. Buffalo’s law went into effect on January 1, 2014 and Rochester’s law goes into effect on November 18, 2014.  Both laws apply to private and public employers, except Buffalo’s also extends to vendors servicing the City.   Buffalo’s law applies to entities having 15 or employees, while Rochester’s law extends to employers with 4 or more employees, including contract and temporary workers.  Both laws prohibit questions about criminal history on employment applications or prior to the first interview, while Rochester also prohibits such questions during the first interview.  There are also certain exceptions where the position is with law enforcement or inquiries into criminal histories are required by licensing authorities, state or federal law.  Buffalo includes an additional exception where the position is with a school or for employers providing services to children, elderly, young adults, and mentally and physically disabled individuals.

Unlike New Jersey’s law, both Rochester’s and Buffalo’s law afford aggrieved individuals with a private cause of action for injunctive relief, damages or “other appropriate relief”, and the prevailing party can recover attorneys’ fees and costs.  New York City has had a law in effect since October 2011 applicable to city agencies limiting their review and consideration of an applicant’s criminal background and incorporating the requirements of Article 23-A.  However, a more extensive “ban the box” law is pending before the New York City Council called the “Fair Chance Act.”  It would be an amendment to the New York City Human Rights Law and would apply to entities with 4 or more employees.

While there is no federal law expressly prohibiting discrimination on the basis of arrests or criminal convictions, it is recognized that adverse employment actions based on criminal records could constitute illegal discrimination under Title VII based on race, color or national origin.  The EEOC has issued enforcement guidance on the consideration of arrests and convictions in the hiring process to avoid discrimination.  This includes consideration of the nature of the offense, the time that has elapsed since the offense occurred, the nature of the position, and encourages the employer to give the applicant an opportunity to show why he or she should not be excluded because of past criminal conduct.

The passing of “ban the box” legislation is rapidly increasing throughout cities and states in the U.S. and so is its expansion to cover private employers.  As a result, all employers should monitor pending legislation in their state, city and/or municipality to ensure that their hiring process is in line with the law.  And, between now and March 15, 2104, New Jersey employers should revise their employment applications to omit any questions related to an applicant’s criminal history, implement proper hiring policies, and train their human resources department and/or hiring individuals on the law’s requirements.