By Paul James

California employers should be aware of two new statutes went into effect on January 1, 2018, that govern the content and procedures for considering job applications in California.

A.  Prohibition Against Inquiries Regarding Applicants’ Prior Criminal Convictions

Labor Code Section 12952 requires employers with five or more employees to implement a multi-step process for consideration of job applicants’ prior criminal convictions.

Previously enacted California Labor Code provisions prohibited California employers from requesting or considering evidence of a job applicant’s prior arrest(s) not resulting in convictions; juvenile records; sealed, dismissed or expunged convictions; or convictions for certain marijuana-related offenses.   Under Labor Code 12952, California employers with five or more employees are now prohibited from requiring job applicants to disclose any information regarding their criminal conviction history at the time their job application is initially submitted and before a conditional offer of employment is made.  Such inquiries cannot be made in the employer’s application form or during the initial pre-offer application or interview process.

In the event a prior criminal conviction is found after a conditional offer of employment is made and the conviction is a factor in the employer’s intention to deny an application for employment, the employer is required to make an individualized assessment of whether the conviction has a “direct and adverse relationship with the specific duties of the job.”  Such an assessment must take into the account (1) the nature and gravity of the offense; (2) the passage of time since the offense and completion of the sentence; and (3) the nature of the job sought.  Employers may, but are not required to, document the results of the foregoing assessment.

Should the employer decide to rescind its conditional offer after conducting the above assessment, the employer must provide the applicant with a written “preliminary decision,” which must include (1) the disqualifying conviction, (2) a copy of the conviction history report (if any) and (3) an explanation that the employee has five business days to respond with information disputing the accuracy of the conviction record or evidence of rehabilitation or mitigating circumstances.  Details regarding the employer’s specific reasoning for rescinding the conditional offer need not be provided.  Applicants who timely advise the employer of their intent to provide evidence disputing the accuracy of the conviction referenced in the preliminary decision are to be given an additional five business days to respond.

If the employer ultimately makes a final decision to deny the application, the employer must provide the applicant with a written notification of the final determination, advising the applicant of any existing procedure the employer has to further challenge the decision, and advising the applicant of his or her right to file a complaint with the Department of Fair Employment and Housing.  The notice of employer’s final determination need not provide the reasoning behind the final determination.

In addition to not applying to employers with fewer than five employees, a  limited number of positions are exempted from Labor Code Section 12952, including positions with criminal justice agencies and positions for which verification of criminal background history is required by law.

Section 12952 is part of the Fair Employment and Housing Act (FEHA), which means aggrieved applicants  can potentially sue employers for statutory FEHA remedies, including compensatory damages, attorney’s fees, and costs.

B.  Prohibition Against Consideration Of Salary History

Labor Code Section 432.3 prohibits all employers from considering or requesting job applicants’ prior salary history for purposes of determining whether to extend an offer of employment, or for  determining what salary to offer the applicant.  Prior salary information that an applicant provides “voluntarily and without prompting” may, however, be considered for purposes of determining an applicant’s prospective salary.  Section 432.3(c) further provides that “[a]n employer, upon reasonable request, shall provide the pay scale for a position to an applicant applying for employment.”

Consideration of salary information available pursuant to public disclosure requirements under state and federal law is excluded from the prohibitions of Section 432.3.

C.  Going Forward

Employers should take immediate steps to ensure their hiring practices conform to these new laws.  Hiring managers should be apprised of the requirements of Labor Code sections 12952 and 432.3 when addressing job applications.  Job applications and forms used to convey offers of employment should be reviewed to ensure all prohibited criteria and language is removed.  Employers should also consider preparing a standardized “pay scale” for various categories of positions in anticipation of applicants’ requests for the same.

For more information about these new laws or any other employment issues, please contact Paul James, a Partner in LGC’s San Diego office.