California Amends Law Preventing Use of Juvenile Criminal History for Employment

Assembly Bill 1843 is an amendment to California Labor Code 432.7 that includes additional restrictions on employment-based inquiries into an applicant or employee’s juvenile criminal history. The new bill, effective January 1^st of next year, restricts employers from:

• Asking an applicant to disclose, either in writing or verbally, information concerning or related to an arrest, detention, processing, diversion, supervision, adjudication, or court disposition that occurred while the individual was subject to the process and jurisdiction of juvenile courts/ law.
• Seeking from any source whatsoever, or using, as a factor in determining any condition of employment (e.g., hiring, promotion, termination, decisions related to a training program, etc.), any record concerning or related to an arrest, detention, processing, diversion, supervision, adjudication, or court disposition that occurred while the individual was subject to the process and jurisdiction of juvenile courts/law.

It is important to note that previous sections of California Labor Code 432.7 allowed employers to look into certain convictions and use them in adverse action decisions if federal law required. The amendment will prevent employers from making decisions based on those preexisting portions of the labor code. This amendment may cause a conflict with preceding federal laws and/or other legal requirements that require specific screening standards for employment. We will keep an eye on this bill as it goes into effect and examine how this conflict will be handled.

You can read Assembly Bill 1843 in full here.

Nevada Eliminates Restriction on Reporting Convictions Over Seven Years Old

On Tuesday, June 9^th, Governor Brian Sandoval signed Senate Bill 409. Prior to this bill, Nevada employers were barred from using convictions over 7 years old in the consideration of a job applicant. This bill, effective immediately, means background screening companies are no longer limited to reporting convictions less than seven years old in Nevada.

SB 409 also allows Nevada employers the use of more extensive background checks, stating “Existing federal law provides certain exceptions to the preceding federal prohibition, including an exception for a credit report prepared in connection with the employment of an individual whose salary will be greater than $75,000. A similar exception in state law exists for a credit report prepared for a gaming licensee in connection with a person who is seeking employment with the licensee or employment in a position connected directly with the licensee’s operations.”

While SB 409 allows you to conduct criminal background checks that include criminal history older than seven years, be mindful of the Equal Employment Opportunity Commission’s (EEOC) guidance on background screening. The EEOC suggests that employers consider the time that has passed since the offense.

S.B. 409 can be read in its entirety here.

NYC Passes Bill Banning Credit Checks in Hiring Process

Pending Mayor DeBlasio signing the bill (Int.0261-2014) into law, New York City will join a growing a list of U.S. localities eliminating credit checks from the background screening process. The New York City Council passed the bill last Thursday April 16, 2015 by a vote of 47-3. Ten states (CA, MD, CT, HI, IL, WA, OR, VT, CO, NV) and two cities (Chicago, IL and Madison, WI) set precedent for NYC’s latest legislature.

One’s credit history, according to the bill, consists of:

• Prior bankruptcies, judgments, or liens

• Number or credit accounts

• Late or missed payments

• Charged-off debts

• Items in collection

• Credit limit

• Prior credit report inquiries

• Items in collections

This bill, an amendment to the NYC Human Rights Law, would make it an unlawful discriminatory practice for an employer to use an individual’s consumer credit history in making employment decisions. Due to the sensitive nature of various employment positions that require additional layers of security, the bill would provide exceptions to several positions.

Exemptions from the credit check ban include:

• An employer, or agent thereof, that is required by state or federal law or regulations or by a self-regulatory organization as defined in section 3(a)(26) of the securitiesexchange act of 1934

• Police officers or any position with a law enforcement or investigative function

• A position in which an employee is required to be bonded under City, state, or federal law

• A position that requires security clearance under federal or state law

• A non-clerical position having regular access to trade secrets, intelligence information, or national security information

• A position having signatory authority over third party funds or assets valued at $10,000 or more

• A position that involves fiduciary responsibility to the employer with the authority to enter financial agreements valued at $10,000 or more on behalf of the employer

• A position with regular duties that allow the employee to modify digital security systems established to prevent the unauthorized use of the employer’s or client’s networks or databases

New York City employers will need to pay close attention as this unfolds. Should this bill become law, modification of employers’ background screening policies will be necessary.

Improving Your Employment Screening Program in 2015

As we kick off 2015, we thought it would be fitting to provide you with some insight on refining your employment screening program. Understanding the basics of employment screening is important, whether you are initiating an employment screening program for the first time or seeking improvements for an existing program. Is improving your program on the agenda for 2015? This 3-part blog will look at three areas in your background screening program worth reviewing: Legal Compliance, Choosing the Right Screening Package, and Customer Service. 

Part 1: Compliance

In Regards to the EEOC:

The first step to promoting compliance is creating a written policy for employment screening at your company. Creating a clearly defined policy and strictly adhering to those guidelines is a great way to protect your company. One recommendation is to clearly state exactly what background information will be utilized for each job position.

You want a non-discriminatory background screening process that does not change from person to person. However, it should be modified for each available job position. EEOC guidance suggests companies determine whether a criminal conduct exclusion is job related and consistent with business necessity. And remember, valid exclusions include relevant convictions, NOT arrests.

The EEOC, which acts in interest of Title VII of the Civil Rights Act, states that employers need to show that their policy operates to effectively link specific conduct, and its dangers, with the risks inherent in the duties of a particular position. This is one of the three factors that the EEOC suggests employers take into account when considering denial of employment. The other two factors are the nature of the crime and the time elapsed. For more information, please read the EEOC’s guidance in full.

In Regards to the FCRA:

The Fair Credit Reporting Act regulates the collection, dissemination, and use of consumer information. Employers are required to follow the regulations set forth by the FCRA when using consumer reporting agencies (like S2Verify) to obtain consumer reports for “employment purposes”. 

The numerous FCRA class action lawsuits from 2014 just go to show that employers are still getting this wrong. O’Reilly Auto Parts, Swift Transportation, Whole Foods, Canon Solutions America, Dollar General, and Publix are just a few companies that were recently involved in costly class action lawsuits. Failure to comply with the FCRA can cost companies millions of dollars. 

Below are rules you must follow to maintain FCRA compliance:    

                                           

Before obtaining background information:

1.       Disclosure and Authorization

a.       Disclosure and authorization forms were the reason many employers (O’Reilly Auto Parts, Publix, Whole Foods) faced class action lawsuits in 2014.

b.      Must be signed BEFORE the background check

c.       Disclosure and authorization forms should be standalone documents and cannot contain extraneous information such as release language

If you plan to deny employment based on the background report:

1.       A Pre-Adverse Action Notice must be sent to the applicant. It must include:

a.       Name, address, and phone number of CRA

b.      The fact that the CRA did not make the adverse decision and cannot give reasons for the decision

c.       His/her right to a free copy of the consumer report

d.      His/her right to contact the CRA to dispute the accuracy of the report

e.      Summary of Rights including any State specific requirements

2.       After allowing the applicant five days to dispute any information found in the report, an Adverse Action Notice is to be sent to the applicant. It must include:

a.       Notification to him/her of final decision to deny employment based on consumer report.

b.      All notification provisions used in Pre-Adverse Action letter.

In Regards to Local Laws:

While it is important to abide by the FCRA and EEOC’s standards, that alone is not enough for legal compliance. You must also stay up-to-date on local laws. In 2014, new local “Ban the Box” laws popped up in counties, cities, and states all over the country. These “Ban the Box” laws, as they are called, not only restrict the use of criminal history inquiry on the application, but potentially tell you at what point in the hiring process a background check may be run. 

A good resource to keep up with your particular city/state and any laws that may apply to your business is NELP.org. For the sake of caution, our best practice recommendation, in most cases, is to hold off on the background check until after a conditional offer is made.

NELP.org - http://www.nelp.org/page/content/banthebox/

FCRA Compliance: Reviewing Your Disclosure and Authorization Forms

    We would like to stress the importance of carefully reviewing the Disclosure and Authorization forms ("Authorization") that are sent to job applicants prior to obtaining background checks. You should ensure that these Authorizations do not include any indemnification or release provisions. 

    Recently an individual in California filed a class action lawsuit seeking to hold both a prospective employer and the CRA that provided a consumer report to that employer liable for failing to comply with the requirements of Section 604(b)(2) of the Fair Credit Reporting Act (FCRA).

    The Authorization that the employer used contained language asking applicants to indemnify and release both the CRA and the employer from any claims that may arise from the collection, disclosure or use of the information provided on the Authorization form. Similar release language, sometimes called a hold-harmless clause, has been the subject of many claims against employers. 

    Class action lawsuits alleging violations of the FCRA are on the rise. Therefore, please be certain that the Disclosure and Authorization forms that you provide to job applicants do not include any type of indemnity, release, or hold-harmless language."

Thanks for your attention to this important compliance matter.

Washington D.C. Ban-the-Box Legislation Set to Take Effect in October

Ban-the-box legislation originally prohibited employers from including the question “have you been convicted of a crime” and its associated check box. This was in an effort to rehabilitate former offenders. The thought process is that without an opportunity to gain employment, many are doomed to become repeat offenders. While recent laws in the same vein are being referred to as ban-the-box laws, this is a bit of a misnomer. The movement towards more regulations on background screening has evolved to include more stipulations than just removing a check box from an application.

The latest to join the recent push for more regulations on background screening is Washington D.C. The bill signed by Mayor Vincent Gray last month will go into effect after a 30-day period of congressional review. It is scheduled to go into effect October 21, 2014. This law, dubbed the Fair Criminal Record Screening Amendment Act of 2014, applies to all D.C. employers with 10 or more employees.

The law states:

•          Employers may not make any inquiry about an arrest or criminal accusation against the applicant, which is not pending and did not result in a conviction.
•          An employer must not make any inquiry about an applicant’s criminal history until after making a conditional offer of employment.
•          A conditional offer can only be rescinded if there is a “legitimate business reason”

Exceptions where inquiry into an applicant’s criminal may precede a conditional offer:

•          Where any federal or District law or regulation requires the consideration of an applicant’s criminal history for the purposes of employment
•          Where a position designated by the employer is part of a federal or District government program or obligation that is designed to encourage the employment of those with criminal histories

Penalties for violation:

•          For employers that employ 11-30 employees, a fine of up to $1,000
•          For employers that employ 31-99 employees, a fine of up to $2,500
•          For employers that employ 100 or more employees, a fine of up to $5,000

It is crucial that D.C. employers update their hiring practices no later than October 21^st.  Ensure that the application has been reviewed and modified accordingly. Also, make sure that a criminal background check is not performed before a conditional offer has been made. Lastly, the exclusion of an applicant based on criminal conduct must be job related and consistent with business necessity. If you are not sure what that means, refer to this EEOC guidance.

There are now 13 states and around 70 cities and counties in the U.S. that have enacted some form of “Ban-the Box” legislation. We will continue to report new developments so that you may remain informed and in compliance with the local laws that apply to you and your organization. Another good resource for staying up-to-date is www.nelp.org.

Ban-the Box Update (August 2014)

Many cities and states are adopting or expanding "Ban the Box" regulations. Here is the latest.

San Francisco

                Today, August 13^th, San Francisco’s Fair Ordinance goes into effect. They certainly are not the first to enact what many are calling “Ban the Box” legislation. This ordinance applies to both the public and private sector. San Francisco employers need to ensure they are up to code on their background screening.

Illinois

                Another change employers should be aware of is Illinois’ expanded “ban the box” legislation that now includes private employers. This makes Illinois the fifth state in the nation to require both public and private employers to limit inquiry about convictions. The other states are Minnesota, Hawaii, Massachusetts, and Rhode Island. Illinois is calling their “Ban the Box” legislation the Job Opportunities for Qualified Applicants Act. It takes effect on January 1, 2015. 

New Jersey

                Governor Chris Christie signed the Opportunity to Compete Act on August 11^th. This law expands New Jersey’s “Ban the Box” regulations to the private sector, much like Illinois’ Job Opportunities for Qualified Applicants Act. It is set to take effect on March 1, 2015. This makes New Jersey the 13^th state to adopt “Band the Box” legislation, and the 6^th state to expand the regulations to the private sector.

“Ban the Box” legislation is spreading like wildfire. As a background screening provider, the only thing we can do is keep you updated on the latest employment screening standards.

While S2Verify cannot provide legal advice, we can suggest you discuss with counsel, the following guidelines:

•          Do not ask about arrests that did not lead to a conviction

•          Do not ask about an individual’s conviction history at the beginning of the hiring process (such as the application)

•          Only after a conditional offer has been made can one ask about criminal history

•          Only convictions related to the job can be considered in the decision to deny employment

Three Employers Face Class Action Lawsuits from the Same Law Firm

 Despite all of the FCRA-related class action suits taking place, it appears large companies are not taking an appropriate course of action to ensure they are in compliance. One has to wonder whether, whether it is simply a lack of attention to detail (That would be a surprise) or simply HR/Legal/Compliance not staying current. The latest three companies in question are Panera, LLC, American Multi-Cinema, Inc. (AMC), and Nine West Holdings. Two of these class action suits involve the same plaintiff, and all three are from the same Florida law firm. In each of these cases, the plaintiff applied for employment online. Each of these companies allegedly failed to provide a valid, compliant consent form before initiating pre-employment background checks.

An employer’s obligation before obtaining background information is as follows (from the co-published FTC/EEOC guide):

·         Tell the applicant or employee you might use the information for decisions about his or her employment. This notice must be in writing and in stand-alone format. The notice can’t be in an employment application. You can include minor additional information in the notice (like a brief description of the nature of consumer reports), but only if it does not confuse or detract from the notice.

·         If you are asking a company to provide an “investigative report” – a report based on personal interviews concerning a person’s character, general reputation, personal characteristics, and lifestyle – you must also tell the applicant or employee of his or her right to a description of the nature and scope of the investigation.

·         Get the applicant’s or employee’s written permission to do the background check. This can be part of the document you use to notify the person that you will get the report. If you want the authorization to allow you to get background reports throughout the person’s employment, make sure you say so clearly and conspicuously.

You can find the FTC/EEOC guidance as a whole here.

Panera allegedly violated the FCRA by not providing a consent form specifically for a consumer report. The plaintiff also alleged that the bakery-café chain included extraneous information that detracted from the notice. American Multi-Cinema, Inc. (AMC) allegedly did not have a stand-alone consent form for online application for employment. And finally, Nine West Holdings allegedly had consent language that was part of a web page that contained a number of links to Nine West information on the website.

The main takeaways from these alleged violations is:

·         Your consent, AKA disclosure and authorization, must be a stand-alone (not part of the application) form.

·         The consent form cannot contain extraneous information

·         The purpose of the consent must be clearly stated (i.e. employment screening)

The lawsuit demonstrates that violations of the FCRA can create large potential liability.  Potential class members, including employees and prospective employees, may be entitled to statutory damages of up to $1,000 for each violation in the case of willful non-compliance. Class action lawsuits also create exposure for large awards of attorney’s fees and the potential exposure to punitive damages.

If you have any doubts about your company’s FCRA compliance, PLEASE act before you wind up on the wrong end of a class-action lawsuit.

Louisville: The Latest City to "Ban the Box"

Add Louisville to the list of cities who have “banned the box”. The Louisville Metro Council passed the new law earlier this month. This means that city employers cannot include a section on the application that asks the applicants to reveal if they have been previously convicted. Louisville joins over 50 cities/counties who have some form of the ban-the-box policy.

These ordinances serve to discourage employers from denying a qualified job-seeker based solely on a prior conviction. This particular law pertains to jobs for the City as well as vendor/contractors who do business with the City. The law pushes back the inquiry into the applicant’s criminal history until later in the hiring process. For more on Louisville’s new ordinance, visit NELP.org.

We are seeing more and more of these policies. Half of the states in the U.S. now have at least one city with a ban-the-box policy. Expect more soon. We will keep you up-to-speed. 

Latest Class Action - Canon Solutions America Inc.

Canon Solutions America Inc. is the latest company to come under compliance fire for an alleged failure to follow FCRA guidelines. Anya McPherson, the individual responsible for the class action, claims that Canon Solutions America fired her without offering her a chance to dispute the results of a background check. McPherson also claims that the charge was more than a decade old and that the conviction was expunged. To make matters more complicated for Canon, the plaintiff also stated that she did not receive a copy of her report, and did not receive a summary of her rights under the FCRA.

Due to the high frequency of cases being brought against employers for FCRA violations, I decided to include a ‘refresher’ for FCRA compliance. 

Please be sure to take into consideration the following:

1) Before Obtaining A Consumer Report

If you intend to use a consumer report for employment purposes, you must provide written disclosure of your intent to perform a background check as a condition of employment. You must also get permission from the applicant. This comes in the form of a written consent form. Once you have obtained consent from the applicant, you can move forward with the background check. The Disclosure and Consent should be kept as separate clearly defined documents or ‘pages’ if you will.

2) Pre-Adverse Action

Adverse Action basically means that you may or intend to deny the applicant employment based on the information you obtained from the background check. If based on your review of the background you plan to pass on the applicant based on this info, you must send the applicant a pre-adverse action letter. 

The Pre-Adverse Action letter must include the following re notification:

• The name, address, and phone number of the Credit Reporting Agency (CRA)

• The fact that the CRA didn't make the adverse decision and cannot give reasons for the decision

• His/her right to a free copy of the consumer report within 60 days

• His/her right to contact the CRA to dispute the accuracy of the report

• Summary of Rights including any State specific requirements

3) Adverse Action

After you have given the applicant 5 days to dispute the report, you may take Adverse Action against the applicant. You must notify them of your final decision to deny employment based upon their consumer report, through use of an Adverse Action Letter, which also must contain all of the above notification provisions mentioned above under pre adverse.

The FTC and EEOC also co-published guidance on the proper procedure for background screening, which can be found here. 

Assessment of the Effects of EEOC's 2012 Background Screening Guidance

In December of 2012, the U.S. Commission on Civil Rights held a briefing to assess the effects of the Equal Employment Opportunity Commission’s 2012 Guidance. This briefing was held to discuss the impact that their guidance had on background screening for both black/Hispanic applicants and employers. Record of this briefing was just released as a 346-page report. I have taken the time to summarize the main points discussed in the report.

The briefing consisted of 17 speakers from diverse backgrounds. While some of the speakers were pro-EEOC Guidance, many speakers took issue with the 2012 Guidance in some way or another.

The speakers are as follows: 

• Alfred Blumstein, Professor of Urban Systems, Carnegie Mellon University

• Carol Miaskoff, Acting Associate Legal Counsel, EEOC

• Don Livingston, Parter, Akin, Gump, Strauss, Hauer & Feld

• Garen Dodge, Partner, Jackson Lewis LLP

• Glenn E. Martin, Vice President of Development and Public Affairs and Director of the David Rothenberg Center for Public Policy at the Fortune Society

• Harry Holzer, Professor of Public Policy, Georgetown University

• Jeffrey Sedgwick, Co-Founder, Keswick Advisors

• Jonathan Segal, Partner, Duane Morris LLP, Legislative Director, Society for Human Resource Management

• Julie Payne, Sr. Vice President and General Counsel of G4S Secure Solutions USA

• Lucia Bone, Founder of Sue Weaver C.A.U.S.E. (Consumer Awareness of Unsafe Service Employment)

• Montserrat Miller, Partner, Arnall Golden Gregory; Counsel, National Association of Professional Background Screeners (NAPBS)

• Nick Fishman, Co-Founder, Chief Marketing Officer and Executive Vice President, EmployeeScreenIQ

• Richard Larson, President, Winning Work Teams, Inc.

• Richard Mellor, VP, Loss Prevention, National Retail Federation

• Roberta Meyers, Director of Legal Action Center’s National Helping Individuals with Criminal Records Reenter through Employment Network, Also Known as H.I.R.E

• Todd McCracken, President, National Small Business Association

• William Dombi, VP, National Association for Home Care and Hospice

Objective of EEOC Guidance

The EEOC claimed the 2012 Guidance is in response to a disparate impact background screening has had on racial minorities. In other words, minorities have been experiencing difficulties while seeking employment due to a past criminal conviction. The objective of the EEOC is to give minorities an equal chance to re-integrate into society.

The Guidance:

• Puts employers on notice that categorical exclusions for people with certain arrest and conviction records may violate Title VII

• Emphasizes its earlier recommendation that job applications not ask about criminal records, and if they do ask, that they limit inquiries to conviction records for which exclusion would be job-related with business necessity

• Offers a series of examples of common policies and practices that violate Title VII 

• Informs local and state governments that barring people with certain criminal records from jobs or occupational licenses also could violate Title VII.  

Advocates of the EEOC Guidance made several arguments for its most recent list of best practices:

• There are over 65 million individuals with criminal records in this country

• By age 35, one-third of all young black men have been incarcerated at some point. 

• A person should not be haunted many years later by a mistake they made at a young age.

• Criminal Records have a more negative impact on employment for minorities.

• Recidivism probability declines with time clean after an arrest or conviction.

• Recidivism is less probable if an individual gains employment.

Speaker Glenn E. Martin presented a study that showed that black applicants with a criminal record were twice as likely to be denied a job as white applicants. He also reported that black and Latino applicants with clean backgrounds fared no better than white applicants just released from prison.

Harry Holzer made several compelling points:

“The prevalence of arrests and convictions among less-educated American men substantially reduces employer willingness to hire them later in life and worsens their employment outcomes more generally, in ways that generate clear “disparate impacts” on minority (especially black) men.

The very high costs of previous criminal histories on employment are borne not only by the offenders themselves, but also by their families and children, their communities, and the US economy more broadly; accordingly having some successful policy efforts to improve employment outcomes for this population are in the nation’s interest.

The EEOC Guidance should be viewed as one of several potentially effective legal and policy efforts to reduce the many barriers to employment among men with criminal records and thus to improve their employment outcomes.”

The Other Side of the Argument

Many speakers stressed that employers should not be restricted in their use of background checks due to:

• The reality of recidivism

• The prevalence of violent and/or theft-related offenses among inmates. 

• OSHA rules that require employers to provide a safe workplace. 

• Federal, state and local laws and licensing requirements that restrict individuals with certain convictions from employment in selected occupations. 

• State laws that put employers at risk for hiring mistakes. 

• Employer desire to protect business assets.  

Major Concerns 

Many speakers took issue with at least some part of the 2012 Guidance. The concerns that were echoed by the majority were:

• The Guidance is unclear. It is written in a way that is confusing to small business owners.

• The Guidance is vague about the act of conducting an individualized assessment.

• A conflict may arise when a state law mandates a background check, but taking adverse action based on that background check may result in a class action.

• The EEOC’s strategic enforcement plan to create class claims from individual claims encourages investigators to conduct overbroad inquiries.

• The EEOC’s restriction on the use of criminal background checks will have disastrous effects on public safety.

• The guidance results in more risk to the employer. For instance, an employer may feel pressure to hire an employee with a criminal record against his better judgment, resulting in a negligent hiring law suit. 

The EEOC aims to give minorities a fair chance to obtain a job after a conviction. They argue that the struggle to re-integrate into society has a profound effect on not only the individuals involved, but the economy as a whole. Frankly, nobody wants an individual to be perpetually unemployed because of a single mistake they made. But according to those opposed to the guidance as it stands, here lies the dilemma. 

The opposition claims if an employer takes a chance on an applicant with a prior conviction, employees and clients are potentially put at risk. By treating minorities with prior convictions as a protected class, are we putting co-workers and customers at risk? Who is correct, the EEOC or those who spoke out against the Guidance? 

We do not have the answer, but we do feel a certain responsibility to help companies comply with the EEOC’s 2012 Guidance. Our clients can rest assured that we will provide as much information as possible to help them maintain compliance. Some of the concerns that were voiced by several speakers have not yet been answered, but we will keep an eye on any potential developments/changes the EEOC might make. 

You can find the U.S. Commission on Civil Rights’ entire report here. Comments? Concerns?

New California Law in Effect: Senate Bill 530

Attention: California Employers

Hundreds of new laws went into effect in California at the beginning of the year. One in particular, Senate Bill 530, has a profound effect on employers and their hiring practices.

The law states “No employer, whether a public agency or private individual or corporation, shall ask an applicant for employment to disclose, through any written form or verbally, information concerning an arrest or detention that did not result in conviction, or information concerning a referral to, and participation in, any pretrial or post-trial diversion program, or concerning a conviction that has been judicially dismissed or ordered sealed pursuant to law”.

Basically, if it did not result in a conviction, you (employers) cannot ask the applicant about it. This applies to diversion programs as well. A satisfactorily completed deferral program is not classified as a conviction. Upon completion of diversion programs, records are often expunged. If the conviction has been expunged, you cannot ask about it. Seeing a pattern? DO NOT ask or seek out information pertaining to charges that did not result in a conviction or have been sealed by the courts.

It also states that you cannot use another source to get information on dismissed criminal charges. As a consumer reporting agency, we focus on reporting convictions. Prior to this law coming into effect, we already refrained from including anything other than charges that resulted in a conviction. This new law is aimed at employers in California who are inquiring about charges that were dismissed and things of that nature.

The law seeks to protect ex-offenders from being discriminated against in the hiring process. If an employer breaks this law, the applicant can bring action against that person to recover actual damages or $200 (whichever is greater) as well as reasonable attorney’s fees. The intentional violation of this law will allow the applicant to treble actual damages or $500 (whichever is greater) plus reasonable attorney’s fees. This intentional violation is also a misdemeanor punishable by a fine of up to $500.

As an employer, you are not privy to information regarding an applicant’s arrests that did not result in a conviction. The law is meant to give someone with a criminal record a second chance. Breaking this law can result in civil penalties. You, as an employer, are responsible for being aware of this new law. Intentionally ignoring the new law can result in misdemeanor criminal charges.

Here is the entire bill.

E-Verify Update

  While it is not mandatory nationwide at this time, there has been recent legislation making E-Verify a requirement in some states. It is important, as an employer, to be aware of your state’s requirements and which businesses it applies to. Each state has a different policy.

A total of 20 states require the use of E-Verify for at least some public and/or private employers: Alabama, Arizona, Colorado, Florida, Georgia, Idaho, Indiana, Louisiana, Michigan, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Utah, Virginia, and West Virginia.

Recent Legislation:

Georgia: The Georgia Illegal Immigration Reform and Enforcement Act of 2011 (HB 87) mandates that private employers with over 10 employees register with and use E-Verify. The mandate’s first effective date was January 1, 2012 for businesses with 500+ employees. On July 1, 2013 the requirements became effective for businesses with 10+ employees. 

North Carolina: The North Carolina General Assembly enacted HB 36 that required businesses in the state with 25 or more employees to use E-Verify on all new hires. North Carolina, much like Georgia, has been using a phased approach. HB 36 became active in October 1, 2012 for employers with 500+ employees. As of July 2013, it now applies to employers with 25+ employees.

Pennsylvania: SB 637, enacted in July 2012, requires all public works state contractors and subcontractors with contracts worth $25,000 or more to enroll and use E-Verify by January 1, 2013.

Tennessee: The Tennessee Lawful Employment Act (HB 1378) requires all employers with more than 5 employees to use E-Verify. A phased in approach was used, starting with private companies with 500+ employees in January of 2012. The Act applies to employers with 6+ employees as of January of 2013. The Act also requires employers to maintain documentation of non-employees paid directly by the employer in exchange for labor or services.

Below is a list of specifics for each state that requires the use of E-Verify for employment eligibility verification.

	State	Citation	Year Enacted	Applies to:	Penalties:
1	Alabama	HB 56 HB 658	2011 2012	All employers (phase in) Contractors and subcontractors; prime contractors not liable for subcontractor complying with E-Verify unless they know of the violation	Cancellation of state government grants or incentives and suspension or revocation of business license up to 60 days, and possible debarment from state contracts. A business license can be permanently revoke on a second offense
2	Arizona	HB 2779 HB 2745	2007 2008	All employers	Temporary AZ business license suspension for 10 days upon first offense; permanent AZ business license suspension upon second offense
3	Colorado	HB 1343 SB 139 SB 193	2006 2008 2008	State agencies, contractors	Contractors may become ineligible to receive state contracts. The Colorado Secretary of State’s Office will post the names of vendors using contractors who knowingly employ illegal aliens to perform work on any public contracts for the state
4	Florida	EO 11-02 EO 11-116	2011 2011	State agencies, contractors, subcontractors	Possible denial of future county projects
5	Georgia	SB 529 HB 2 SB 447 HB 87 HB 742 HB 1027	2006 2009 2010 2011 2012 2012	Public employers, contractors, subcontractors with 500+ employees (phase in)	Failure to comply could result in the suspension or denial of a business license, occupational tax certificate, or other document require to operate a business in the state
6	Idaho	EO 2009-10	2009	State agencies, contractors	Immediate cancellation of the contract, reversion of unspent public funds, and monetary penalties. Every contract by a state agency for a state project or service shall include appropriate civil penalties for violation this executive order
7	Indiana	SB 590	2011	State agencies, contractors	State agencies or political subdivisions may terminate a public contract if the contractor knowingly employs an unauthorized alien
8	Louisiana	HB 342 HB 646 HB 996	2011 2011 2012	State contractors Option for private employers	Failure to complete the affidavit or use E-Verify as required would cause the work to be terminated and bar the contractor from future bidding or contract work for up to three years. HB 646 makes it a state offense to employ unauthorized workers and provides E-Verify as a defense to any charges brought under HB 646
9	Michigan	HB 5365	2012	State agencies, contractors, subcontractors	Employers who do not use E-Verify may have all state contracts terminated and become ineligible for public contracts for three years, and/or may have licenses, permits, or certificates suspended for one year.
10	Mississippi	SB 2988	2008	All employers (phase in)	Employers who do not use E-Verify may have all state contracts terminated and become ineligible for public contracts for three years, and/or may have licenses, permits, or certificates suspended for one year.
11	Missouri	HB 1549 HB 390	2008 2009	Public employers, contractors, subcontractors	A violating company’s business permit and licenses shall be suspended for 14 days. Upon the first violation, the state may terminate contracts and bar the company from doing business with the state for 3 years. Upon second violation, the state may permanently debar the company from doing business with the state.
12	Nebraska	LB 403	2009	Public employers, contractors	Loss of eligibility for state contract work and/or state economic incentives.
13	North Carolina	SB 1523 HB 36	2006 2011	State agencies, universities Localities, all employers (phase in)	Failure to comply with HB 36 can result in civil fines ($10,000+) and notification to U.S. Immigration and Customs Enforcement and local law enforcement agencies.
14	Oklahoma	HB 1804	2007	Public employers, contractors, subcontractors	Ineligibility to receive a state contract(s).
15	Pennsylvania	SB 637	2012	Public contractors, subcontractors	First violations incur a warning letter detailing the violation, posted on the website of the Department of General Services of the Commonwealth. On a second violation, the contractor is debarred from public work for 30 days. Upon subsequent violations, the contractor is debarred from public work for 180-365 days. In the case of willful violation, the contractor is debarred from public work for a period of three years. Contractors will also incur a penalty of $250-$1,000 per violation.
16	South Carolina	HB 4400 SB 20 HB 4813	2008 2011 2012	Public employers, contractors (phase in) Private employers Establishes a 24-hour hotline to report E-Verify violations	Possible civil penalty of up to $1,000 per violation and the revocation of the business license.
17	Tennessee	HB 1378	2011	All employers with 6+ employees (phase in)	Employers can incur a penalty of $500 plus an additional $500 for each employee not verified for a first violation; $1,000 plus and additional $1,000 for each employee not verified for a second violation; and $2,500 plus and additional $2,500 for each employee not verified for subsequent violations.
18	Utah	SB 81 SB 39 SB 251 HB 116	2008 2009 2010 2011	Public employers, contractors, subcontractors Private employers with more than 15 employees	Ineligibility to enter into a state contract(s). A private employer may be held civilly liable under state law in a cause of unlawful hiring of an unauthorized alien.
19	Virginia	HB 737 HB 1859 SB 1049	2010 2011	State agencies Public contractors, subcontractors with more than 50 employees	Any employer, including contractors, found to be in violation shall be debarred from entering into a contract with any agency of the Commonwealth for up to one year. The employer shall be released from debarment upon registration and participation in E-Verify. A contractor who fails to enroll and participate in E-Verify may be denied prequalification for contracts.
20	West Virginia	SB 659	2012	Public Employers, contractors	Loss of eligibility for state contract work and/or state economic incentives.