"Fair Is Foul and Foul Is Fair" - NYC Employers Gird for Fair Chance Act

20 October 2015 Labor & Employment Law Perspectives Blog
Author(s): Jonathan L. Israel


Things or people are not as they always appear to be. That message pervades not only Shakespeare’s Macbeth but also New York City’s Fair Chance Act (FCA), which is scheduled to go into effect next week (on October 27) and is designed to promote the hiring of individuals who have prior criminal convictions. To that end, the FCA’s prohibitions and requirements will materially limit the ability of NYC employers to (i) conduct criminal background checks on job applicants and (ii) reject an applicant based upon the applicant’s criminal record.

From a broader perspective, this development in the Big Apple is reflective of a trend. As we have discussed here previously, “Ban the Box” legislation is a quickly evolving area of employment law, with a myriad of states and localities now regulating employer use of criminal background check information in hiring decisions.

The FCA is the latest of these “Ban the Box” laws, and applies to NYC employers with four or more employees. Going farther than many similar laws elsewhere, the FCA prohibits an employer from inquiring into an applicant’s criminal record before a conditional offer of employment is made. This means that, until a job offer is extended, the employer cannot conduct a criminal background check or even pose questions about the applicant’s criminal history, including on an employment application or during an interview. Under the FCA, any impermissible inquiry is not just evidence of intent to discriminate, but now constitutes unlawful discrimination under the NYC Human Rights Law and is enforceable by a private right of action. The FCA also prohibits solicitations, advertisements, or publications that state or suggest that an applicant’s opportunity for employment may be limited by an arrest or criminal conviction record.

The FCA does not just prohibit pre-offer inquiries but also severely restricts the employer’s post-offer discretion when the prospective employee ultimately is found to have a prior criminal conviction. Under the FCA, an employer cannot rescind an offer based on a prior conviction without first delivering to the applicant a copy of (i) Article 23-A of the New York Corrections Law (which addresses and limits an employer’s ability to reject an applicant based on a conviction record), (ii) the results of the background check report or inquiry (in a form to be issued by the NYC Commission on Human Rights (NYCCHR), and (iii) the employer’s “analysis and the factors used to make the decision” under Article 23-A of the Corrections Law (also in a form to be issued by the NYCCHR). The job offer must then be kept open for at least three days so that the applicant has an opportunity to respond to the employer.

Article 23-A of the Corrections Law has been in place for many years, and it requires an employer to consider and weigh a variety of factors when determining whether to hire an applicant with a prior conviction, including, among other things, the relatedness of the conviction to the job, the impact the conviction may have on the applicant’s ability to do the job, and the seriousness of the offense.

While employers may be familiar with these applicable factors and the required analysis under the pre-existing Corrections Law, what is new under the FCA is the requirement that they must now produce their analysis and the factors considered, in writing, to the applicant as part of the required steps to rescind a job offer. A daunting task indeed, which will require employers to confront directly the potentialities and risks of a discrimination claim. In the meantime, we are one week out from the FCA’s effective date and the NYCCHR has yet to reveal the required format for this report (or for the report on the employer’s “inquiry” which conceivably may involve and include interview and follow up notes in addition to any report received from a reporting agency).

Employers subject to this FCA will need to understand which jobs and employer activities and actions are exempt from the law’s proscriptions. In addition, employment applications and job listings should be reviewed and revised as needed; management training on impermissible interview questions may need to be conducted; and detailed protocols relating to FCA requirements should be created and implemented, particularly with respect to the rescission of an offer. (Many of these same considerations also will apply to NYC’s Stop Credit Discrimination in Employment Act, which became effective last month and prohibits discrimination against job applicants based on consumer credit history.)

Although employers in New York City and elsewhere will still be able to deny jobs to applicants with prior convictions, it is about to get much, much harder to do so without significant legal risk, and for these reasons, employers will need to proceed with care and caution in any such case. And, given the national trend toward enactment and enforcement of Ban the Box laws, employers outside the Big Apple should keep an eye on the FCA, as it may be a preview of things to come.

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