Changes to the California Fair Chance Act

The California Civil Rights Council recently amended the regulations interpreting California’s 2018 Fair Chance Act. These modifications, which will come into effect on October 1st, 2023,  are designed to enhance fairness and equity in the employment process for individuals with prior criminal histories.

The Fair Chance Act has been in place for a significant period, promoting equal opportunities and fairness in hiring practices. The recent changes, approved by the Office of Administrative Law on July 24, 2023, following the recommendations of the California Civil Rights Council, bring a series of adjustments that will require your attention to ensure compliance.

Key modifications include:

• Definition of "applicant" now includes existing employees subject to review due to changes in ownership, management, policy, or practice.
• Employers are prohibited from including language in job advertisements that discriminates against applicants with criminal histories.
• Employers must conduct an individualized assessment before rejecting an applicant based on their criminal history, considering factors such as the nature of the offense, the time that has passed, and the nature of the job.
• Employers are required to conduct an "initial" individualized assessment before sending the notice of preliminary decision, clarifying the process for reaching decisions.
• Consideration of rehabilitation or mitigating evidence provided by applicants or employees.
• Detailed guidelines for reassessment if rehabilitation evidence is presented after a preliminary decision notice.
• Clear notice delivery timelines and methods for applicants or employees to respond to preliminary decision notices (covered in greater detail below).
• Expanding the definition of "employer" to encompass entities evaluating conviction history on behalf of employers.

Among the various amendments, one critical area of focus is the timing of taking adverse actions based on an individual's criminal history. Below, we elaborate on this point and provide additional insights into the key changes:

Timing of Adverse Action: As part of the updated Fair Chance Act, employers are still required to wait until after extending a conditional offer of employment before making inquiries about or considering an applicant's criminal history. This means that any consideration of a candidate's criminal history should come after the point where you have offered them the job, contingent on certain conditions. If an employer intends to deny an applicant the employment position they were conditionally offered based solely or in part on the applicant’s conviction history, the employer must first conduct an individualized assessment taking into consideration:

• The nature and gravity of the offense or conduct, including but not limited to:
  • Whether the harm was to property or people;
  • The degree of the harm (e.g., amount of loss in theft);
  • The context in which the offense occurred;
  • Whether a disability, including but not limited to a past drug addiction or mental impairment, contributed to the offense or conduct
  • Whether trauma, domestic or dating violence, sexual assault, stalking, human trafficking, duress, or other similar factors contributed to the offense or conduct; and/or 
  • The age of the applicant when the conduct occurred.
• The time that has passed since the offense or conduct and/or completion of the sentence
• The nature of the job held or sought
• Notice of the deadline for the applicant to respond, if the applicant chooses to do so:
  • The deadline for providing a response must be at least five business days from the date of receipt of the notice. An employer may offer an applicant more than five business days to respond to the notice regarding its preliminary decision.
  • If notice is transmitted through a format that does not provide a confirmation of receipt, such as a written notice mailed by an employer without tracking delivery enabled, the notice shall be deemed received five calendar days after the mailing is deposited for delivery for California addresses, ten calendar days after the mailing for addresses outside of California, and twenty calendar days after mailing for addresses outside of the United States.
  • If notice is transmitted through email, the notice shall be deemed received two business days after it is sent. 
• Click here to view a Sample Pre-Adverse Action Notice for California Applicants, Employees and residents

These changes intend to ensure that individuals are not unfairly prejudiced by their criminal history during the initial stages of the application process, thereby giving them a fair opportunity to demonstrate their qualifications for the role. An applicant residing in CA could argue this Act applies to them if they will be working remotely in CA, but the Act really applies to CA employers.  Employers operating outside of CA will have to decide on their own (or with their legal counsel) if they want to extend these rules to candidates residing in CA who are applying to work for their organization either through commuting or via remote work.

 Given the significance of these changes, we encourage you to take the following steps:

• Review your hiring practices to ensure they align with the new requirements.
• Update job advertisements to comply with the prohibition against indicating the exclusion of candidates with criminal histories.
• Familiarize yourself with the two-step notice process and its implications for making informed employment decisions.
• Ensure your internal assessment process adheres to the new guidelines for considering individual circumstances.
• Seek legal advice or consult experts to address any questions or concerns about the forthcoming modifications.
• We understand that adapting to these changes might necessitate adjustments in your procedures. Nevertheless, embracing these alterations will contribute to a more equitable and inclusive hiring process.

For more detailed information on these modifications, please visit the California Civil Rights Department for additional resources. 

Should you have any questions or require further clarification, please do not hesitate to contact us. 

The information and opinions expressed are for educational purposes only and are based 
on current practice, industry related knowledge and business expertise. The information
provided shall not be construed as legal advice, express or implied. 

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