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NEW YORK CITY EXPANDS FAIR CHANCE AND BACKGROUND CHECK OBLIGATIONS IMPOSED ON EMPLOYERS


Effective July 29, 2021, most New York City employers will have additional obligations under the Fair Chance Act (“FCA”). Since 2015, the FCA has: (i) prohibited New York City employers from inquiring into an applicant’s criminal history prior to making a conditional job offer; and (ii) required New York City employers to engage in a detailed process prior to revoking a conditional offer on the basis of information learned through a background check. This existing law presented a number of compliance challenges with costly penalties of up to $250,000 and the amendments only add to the burden.

The amendments expand the coverage of the FCA to more employers and more persons in two respects. First, an employer is now covered if it has four persons working for it, whether as employees or as independent contractors. Second, the inquiries prohibited by the FCA and the process to be followed now apply to independent contractors as well.

The amendments also limit an employer’s ability to take an adverse action against a current employee who is convicted of a crime, arrest, or accused of criminal conduct, during their employment unless the employer has determined that either: (i) there is a direct relationship between the conviction or the arrest and the position held; or (ii) a continuation of employment would present an unreasonable risk to property or the safety of individuals or the general public.

An employer seeking to take an adverse action against a current employee must additionally comply with an updated FCA Process. Thus, prior to taking an adverse action against a current employee, employers must: (i) request information relevant to the FCA factors; (ii) perform an individualized analysis under the FCA and Article 23-A of the Corrections Law; (iii) provide a written copy of the analysis to the employee; and (iv) allow the employee a “reasonable time” before taking the adverse action. Employers can, however, place an employee on unpaid leave during this FCA Process.

The amendments also created additional factors for employers to use as part of the FCA Process. Employers considering arrests or convictions that occurred prior to employment, must consider: (i) the public policy favoring employment of persons with criminal histories; (ii) the specific duties performed by the employee; (iii) the bearing, if any, the criminal offense will have on the employee’s ability to perform his or her duties; (iv) the time that has passed since the criminal offense; (v) the age of the employee at the time of the offense; (vi) the seriousness of the offense; (vii) any information concerning rehabilitation and good conduct; and (viii) the legitimate interest the employer may have in protecting property or persons.

Employers considering arrests or convictions that are pending at the time of an application for employment (or promotion or transfer), must consider: (i) the policy of New York City to avoid the unnecessary exclusion of persons with criminal histories from employment; (ii) the specific duties performed by the employee; (iii) the bearing, if any, the criminal offense will have on the employee’s ability to perform his or her duties; (iv) whether the person was 25 or younger at the time of the offense; (v) the seriousness of the offense; (vi) any information concerning rehabilitation and good conduct; and (vii) the legitimate interest the employer may have in protecting property or persons.

Employers may continue to take adverse action against an applicant or employee who intentionally misrepresents his or her arrest or conviction history. However, employers must provide the affected person with any documents that lead the employer to determine that an intentional misrepresentation was made and provide the person with a reasonable amount of time to respond.

Violations of the FCA are often indefensible given that many violations are considered “per se” violations. Employers must be sure to revisit their background check policies for applicants as well as current employees to avoid significant penalties.

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