Significant Proposed DFEH Regulation on Criminal History

At its next meeting in January the California Fair Employment & Housing Council will discuss and open for public comment a proposed regulation limiting employers’ use of criminal records in employment decisions.  The proposed regulation incorporates the existing limitations found in California statutes such as the prohibition against using arrest records.  But, the proposed regulation also adds new limitations on employers and new obligations that are not found in the statutes.

Most significantly, the proposed regulations would effectively outlaw “bright-line, across-the-board” policies against hiring individuals with criminal histories.  The regulations would also add a requirement that if an employer takes an adverse employment action against an applicant (i.e. not hiring) or an employee (i.e. terminating), the employer must disclose that fact to the individual and give the individual the opportunity to present evidence that the criminal record is inaccurate.  The text of the relevant portion of the proposed regulation is copied below.

I will bite my tongue and not rant in this blog about law making by government agencies and appointed councils as opposed to our elected Legislature.  But, I will advise employers that the regulation will likely be adopted. Accordingly, those employers who currently have a bright-line, across-the-board policy of automatically disqualifying individuals with a criminal history should change to individual consideration—or at least not announce the policy.

2 CCR § 11017.1 (3)  

(e) Establishing Job Relatedness and Business Necessity. If the policy or practice of considering criminal convictions creates an adverse disparate impact for applicants or employees on a basis protected by the Act, the burden shifts to the employer to establish that the policy is nonetheless justifiable because it is job-related and consistent with business necessity. The criminal conviction consideration policy or practice needs to bear a demonstrable relationship to successful performance on the job and in the workplace and measure the person’s fitness for the specific job, not merely an evaluation of the person in the abstract. In order to establish job relatedness and business necessity, any employer must demonstrate that the policy or practice is appropriately tailored, taking into account at least the following factors:

(1) The nature and gravity of the offense or conduct;

(2) The time that has passed since the offense or conduct and/or completion of the sentence; and

(3) The nature of the job held or sought.

Demonstrating that a policy or practice of considering conviction history is appropriately tailored to the jobs it is used as an evaluation factor for requires that an employer either: undergo an individualized assessment of the circumstances or qualifications of the applicants or employees excluded by the conviction screen; or be able to demonstrate that any bright-line, across the board, conviction disqualification can appropriately distinguish between applicants or employees that do and do not pose an unacceptable level of risk and that the convictions being used to disqualify have a direct and specific negative bearing on the person’s ability to perform the duties or responsibilities necessarily related to the employment position. Bright-line conviction disqualification policies or practices that do not incorporate an individualized assessment and include conviction related information that is seven or more years old (measured from the date of disposition, release or parole) are subject to a rebuttable presumption that they are not sufficiently tailored to meet the job-related and consistent with business necessity affirmative defense (except if justified by subsection (f) below). Before an employer may take an adverse action such as declining to hire, discharging, or declining to promote an adversely impacted individual based on conviction history obtained through a credit report or internally generated research, the employer must give the impacted individual notice of the disqualifying conviction and a reasonable opportunity to present evidence that the information is inaccurate.