California Background Checks by Chris Dyer. (800)
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1 California Background Checks by Chris Dyer (800)
2 California is a challenge!
3 The Plan 1 FCRA The rule applies to everyone 2 CA Specific What s so different 3 Disclosures Requirements for Federal and CA law 4 CA Credit Very restricted 5 Specific 6 Adverse Action tactics to drive change and culture Best Practices A little more
4 About Me Passion and Work Choose a job you love, and you will never have to work a day in your life. --Confucius CEO-PeopleG2 Recognized expert and thought leader in the area of background checks, FCRA compliance and best practices. Speaker Regularly speak on Company Culture, Background Checks, Virtual Employees, and Secrets of Talented People Radio Show Host Talent Talk Radio features engaging conversation with CEOs, thought leaders and HR executives. Talent Talk connects professionals who care about talentrelated issues and leadership. Business Coach Work with companies to improve areas like Culture, Virtual and Hybrid Communication Strategies, Background Check Compliance, and Negotiations.
5 Talent Talk Radio Live each Tuesday at 1 PM PST On Podcast anytime, just search for TalentTalk Over 85,000 regular listeners in HR and Senior Leadership Celebrity Guests: Marshall Goldsmith & Kelly Perdew CEO Thought Leaders: Dave Berkus, RJ Nicolosi of INC HR Leaders: Intel, Golden State Foods, Lockheed Martin, Southwest Airlines, Citi Trends, CACI, Vans, SHRM, and many more.
6 PeopleG2.com
7 Virtual Model OC Register - Employees told to go home and work PeopleG2 recognized for its unique approach, and one of only a few nationally that has successfully gone from traditional to virtual.
8
9 The Plan 1 FCRA The rule applies to everyone 2 CA Specific What s so different 3 Disclosures Requirements for Federal and CA law 4 CA Credit Very restricted 5 Specific 6 Adverse Action tactics to drive change and culture Best Practices A little more
10 Poll Question How well do you know the FCRA? a)expert b)good understanding c) Still learning
11 #1 FCRA
12 FCRA Rules we all have to know FCRA Requirements for Background Checks You must: o Have a permissible purpose- as defined under Section 604 of the FCRA. For employers, it is employment purposes o Provide a clear, conspicuous document notice/disclosure to the employee/applicant o Release and Authorization- bases on current interpretation we suggest two separate documents. o Huge area of class action lawsuits o Supply a copy of the summary of rights under the FCRA- Must be given to the applicant prior to any investigations being done. o Obtain signed authorization/consent from the applicant/employee o This signed document must be kept for a minimum of 5 years no matter the outcome, could be longer or have other requirements for storage in certain states.
13 FCRA Rules we all have to know FCRA Requirements for Background Checks Adverse Action (if employment is denied): Send a pre-adverse action notice, a copy of the report, and another copy of the summary of rights Wait a reasonable amount of time (FTC recommends 5 business days) If info is not disputed and decision is unchanged, send adverse action notice
14 #2 CASpecific
15 CA Specific Terms used in California Employment Background Check = Investigative Consumer Report (ICR). FCRA- Investigative Consumer Report is limited to personal interviews with your friends, neighbors or business associates. (same name, different meaning) California- ICR covers your "character, general reputation, personal characteristics, or mode of living" obtained through "any means." Under California law, a company that collects information for employers and compiles reports is called an Investigative Consumer Reporting Agency (ICRA). The term ICR does not include credit reports. (more on this later)
16 CA Specific Restrictions in California What cannot be included in a CA Background Report? o California law (ICRAA) follows the FCRA's general seven-year rule as the limit for reporting negative information on an employment background check. One exception is that under the FCRA criminal convictions can be reported indefinitely. In California, criminal convictions can only be reported for seven years unless another law requires employers to look deeper into your background. California also follows the ten-year limit for reporting bankruptcies, the same as the FCRA. (CA Civil Code ) o Background check reports often include information from public records. In California, a background checking agency cannot include public record information in an employment check unless it has verified the accuracy of the information during the 30-day period before the report is issued. This applies to such information as arrests, indictments, convictions, civil actions, tax liens, and outstanding judgments. o Database Searches can be tricky in CA and must be verified.
17 CA Specific Restrictions in California California law also differs from the FCRA for other reporting requirements, as follows: o Arrest, indictment, information, misdemeanor complaint. Arrests and the formal charges shown in an indictment, information or complaint that result from an arrest can be reported for up to seven years in California. But these records cannot be reported if a conviction did not result. However, they can be reported pending judgment. This means if you were arrested and the matter has not come to trial or has otherwise not been resolved, it can still be reported in an employment background check. o Criminal convictions. Unlike the indefinite standard of the FCRA, criminal convictions in California can only be reported up to seven years. Convictions cannot be reported if a full pardon has been granted.
18 CA Specific Restrictions in California Marijuana o Convictions for marijuana possession offenses more than two years old cannot be considered Sex Offender information o Employers cannot refuse to hire or fire based on the employees listing on Megan s Law website o Employees and applicant can sue for damages, and civil penalties up to $25K
19 CA Specific Restrictions in California Little known CA law regarding employers doing their own public records searches Civil Code Section (a) Any person who uses personal background information even information that is a matter of public record for employment purposes must provide that information to the consumer within 7 days. Public records arrest records, indictment, conviction, civil judicial action, tax lien or judgment This obligation is in place whether the employer obtained the actual copies or just a verbal summary Example: an in-house researcher may give a verbal report that an applicant has convictions instead of obtaining hard copies of the court records. Does the employer have any disclosure obligations? Yes
20 CA Specific Exceptions o The ICRAA does not apply if another law requires a government agency or employer to conduct a certain type of background check. Many jobs require an employer to check for criminal convictions far beyond the seven-year limit included in the ICRAA. For example, operators of residential care facilities for the elderly and the facility's employees are subject to a "full criminal records" check. (California Health and Safety Code ) o In addition, occupations that require a state license often require an extensive criminal background check. For more information on jobs that require a state license. o The ICRAA does not apply if another law requires a government agency or employer to conduct a certain type of background check. Many jobs require an employer to check for criminal convictions far beyond the seven-year limit included in the ICRAA. For example, operators of residential care facilities for the elderly and the facility's employees are subject to a "full criminal records" check. (California Health and Safety Code )
21 CA Specific Common Question Can an employer ask about an arrest or conviction that should not be reported? No. The "Ban the Box" law in the California Labor Code says an employer cannot ask about: o Any arrest or detention that did not result in a conviction. o Any arrest for which pretrial diversion has been completed. o As of January 1, 2014, employers are prohibited from asking job applicants about criminal records that have been expunged, sealed or dismissed. o As of July 1, 2014, public sector employers (California state and local agencies, cities and counties) are prohibited from asking about criminal records on employment applications. Public sector employers must review an applicant's qualifications before inquiring about their conviction history.
22 CA Specific Social Media California rules on obtaining a consumer s social network site password. o Employer Use of Social Media- prohibits employers' access to applicants' and employees' personal social media content. Employers cannot request or require that applicants or employees: (a) disclose social media log-in credentials; (b) access personal social media in the employer's presence, i.e., allow the employer to "shoulder surf;" or (c) "divulge any personal social media content." The third prohibition is particularly broad, apparently barring an employer from asking an employee to provide the personal social media content of a co-worker who is a Facebook friend. Under the law, "social media" includes social media services and accounts, as well as content such as videos, photos, blogs, podcasts, text messages, , and website profiles and locations. o California's law contains a critical exception for employers. The exception permits employers to ask an employee to divulge personal social media content that the employer "reasonably believe[s] to be relevant to an investigation of allegations of employee misconduct or employee violation of applicable laws and regulations."
23 Poll Question Are you aware that San Francisco enacted new rules that are different than the state requirments? 1)Yes 2)No
24 CA Specific San Francisco s Fair Chance Ordinance Imposes substantive restrictions on the information employers can seek from criminal background checks: o Bars employers from asking about criminal history or conducting a background check until it s determined that the applicant meets the requirements. o Removal of the box asking, Have you ever been convicted of a crime? o Employers may ask about a candidates criminal history after the first live interview, but must provide candidate with notice of rights. o Employers are prohibited from considering: o Any arrests that don t lead to convictions o Offenses other than felonies or misdemeanors o Convictions greater than seven years old o An applicant s participation or completion of a diversion program o Sealed, inoperative or juvenile convictions
25 #3 Disclosures
26 Disclosures Federal vs California Federal Law - Definition o FCRA imposes requirements on users of Investigative Consumer Reports o ICR is defined by fed law as containing information obtained through personal interviews of neighbors, friends, and other associates about character, general reputation, personal characteristics and mode of living. California Law Definition o ICR is defined by CA law as all third party collection of information about character obtained through any means, not just personal interviews with acquaintances. o Includes reference checks performed by a third party
27 Disclosures Federal vs California Under California s ICRRA, employers must disclose: o An investigative consumer report will be obtained for employment purposes o The report may contain information bearing on character, reputation, personal characteristics, mode of living o Nature and scope of the investigation o Name, address, phone number and website of the CRA o Notice of employee/applicant rights to inspect the CRA s files in person, to have the file summarized over the phone, or to have a copy of the file mailed by certified mail o A check box for requesting a free copy of the report (which must be provided within 3 business days of the date the report is given to the employer
28 Disclosures Federal vs California According to the California Investigative Consumer Reporting Agencies Act, employers seeking authorization to procure an investigative consumer report must disclose 1) both the nature and scope of the investigation and, 2) a box for requesting a copy of the report Unique language that must be in California consent: Under California Civil Code section , the applicant is entitled to find out what is in the CRA s file on them with proper identification.
29 Disclosures Can an employer run a check without an applicant s permission? You must give your authorization in writing before an employer can start the investigation process through a screening agency. Again, your written permission is required by the FCRA as well as the California ICRAA. Like the FCRA, California law requires your specific authorization if information about your medical history or condition will be obtained. For employer-conducted screening in California, the permission and notice requirements are less rigid. A cautious employer may ask for your consent, even to do an in-house investigation. However, the only real indication that a background check will be conducted may come in an application or other document. A California employer that conducts its own investigation must give the subject an opportunity to give up the right to get a copy of public documents. There is one exception in California. Your permission is not required and you are not entitled to notice if your employer suspects you of wrongdoing or misconduct.
30 Poll Question Have you updated your Release and Authorization forms this year? 1)Yes 2)No
31 #4 CACredit
32 CA Credit If an employer in California wants to see your credit report as part of an employment background check, that report is also governed by the Consumer Credit Reporting Agencies Act (CCRAA). (CA Civil Code 1785) Effective January 1, 2012, an employer in California can only request your credit report for certain positions. If the position falls into one of the categories that allow a credit check, the employer must give notice that a credit check will be obtained, along with an explanation of why the check is allowed. Notice/disclosure must contain: A check box for applicant/employee to indicate whether they want a copy. This must be provided to the applicant if requested by employer Specific name, address, website of CRA Information that the applicant/employee has a right to find out what is in the CRA s file. CA applicant have the right to bring someone else along to the inspection
33 CA Credit Exceptions: A California employer cannot review a credit report unless the job falls into one of numerous exceptions. Jobs that allow a credit check include: A position in the state Department of Justice A managerial position A position as a sworn peace officer or other law enforcement job A position for which the information is required by law A position that involves access to specified personal information A position in which the person is a named signatory on the employer's bank or credit card account A position that involves access to confidential or proprietary information A position that involves regular access to $10,000 or more of cash
34 #5 AdverseAction
35 Adverse Action Adverse and Pre-Adverse Action Pre-Adverse and Adverse Action Notices in CA: o No pre-adverse action notice is specific in CA statute HOWEVER, one is needed for FCRA compliance o If adverse action is taken as a result of a credit report, the adverse action letter should state the reason the action is being taken For employers to follow FCRA guidelines: o Send a pre-adverse action notice which tells the applicant that adverse action may be taken based in whole or in part of information provided by a CRA. o Must contain the information about the CRA, copy of the report, and a copy of Consumer rights. o Employee must get a copy whether they asked for it or not o Wait a reasonable amount of time (five days recommended by FTC) before final adverse action o Send adverse action notice
36 Adverse Action San Francisco: Adverse and Pre-Adverse Action o Requires using a different, more explicit pre-adverse action notice and a different time table. Specifically, not only notifying the applicant of intended adverse action and supplying a copy of the report, but disclosing the specific items that are triggering the intention to deny employment. o Requires an applicant to be able to refute orally or in writing within a 7 day waiting period before final decision. o After receipt of information explaining criminal convictions, an employer must reconsider for a reasonable amount of time. o Requires that employers post a notice in the workplace, and revise advertisements/postings to state that they employer will consider qualified applicants with criminal histories. o Employers must retain all pertinent records/applications for 3 years. o Applies to employers doing business in SF City with 20 or more employee.
37 #6 estpractices
38 Background Check Best Practices All in the context of hiring new employees, based on my October 2012 Forbes article: Broad and Thorough Consistency and Communication Follow the Law Patterns and Negativity EEOC and The Box Professional Agencies and DIY
39 EEOC Guidance Proceed with caution GOAL Compliance Best Practices Showdown between the Guidance and current laws Individualized Assessment Moving from standardized to specialized A subjective and employee-specific process Evaluating Criminal History Nature and gravity, time and position
40 EEOC and The Box April New Guidance Suggestions Remove the The Box from your application or other forms. By asking about criminal history at the front end of your process, you are more likely to violate their guidance Document the process Evaluate the positives and negatives Be consistent, but avoid policies that automatically exclude applicants based on general terms For example: we don t hire anyone with a felony
41 What is your question? Any specific questions or issues from today s presentation?
42 California Background Checks by Chris Dyer (800)
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