Employee Background Checks in California

Pay Careful Attention to the Law

Employee Background Check LawMillions of people have convictions or arrest records affecting their daily lives, especially when it comes to employment and being able to support themselves and their families. Historically, employers have conducted employee background checks for all positions in their companies. Businesses often won’t hire employees with criminal records and many people who try to rebuild their lives after being arrested or serving time can’t get work.

National Employment Law Project attorney Michelle Rogriguez says an employee background check causes critical problems for people with criminal records. She says having a criminal record doesn’t make someone a criminal, it just means that they had legal issues. Employers argue, however, that they have a right to protect their business and the other employees and that the best way to do so is through a background check.

California Background Check Laws

As of January 1, 2012, employers in California can only obtain employee credit reports on applicants for the following types of positions:

  • Managerial positions which are exempt as an executive and supervise two or more employees per California’s wage and hour rules
  • State Department of Justice positions
  • Law enforcement or sworn peace officer positions
  • Positions for which the credit report information is required by law to be disclosed or obtained
  • Positions that require regular access to an individual’s bank or credit card information, social security number and date of birth
  • Positions for which the applicant would be a named signatory on the employer’s bank or credit card account, authorized to transfer the employer’s money, authorized to enter into financial contracts for the employer
  • Positions that have access to trade secret information, as defined by California’s Uniform Trade Secret Act
  • Positions involving regular access to over $10,000 of the employer’s cash, clients, or customers

Employers using outside reporting agencies for employment credit checks must notify the applicant in writing about the type of position the applicant is under consideration for that allows the employer to run a consumer credit report. After receiving the consumer credit report, the employer must notify the applicant if they will take any adverse action because of information in the credit report and provide the name and address of the agency that prepared it.

Ban-the-Box in California City

California City, a San Francisco suburb, passed an ordinance in August 2013 prohibiting city contractors from ever asking about the criminal histories of a majority of job applicants.  Similar laws are gaining popularity in other states and are referred to as “ban-the-box” laws. They are a response to the tough economic times and tougher sentencing laws that have resulted in more people being shut out of employment opportunities, as well as the belief that those who have completed sentencing or have a minor scuffle with the law shouldn’t continue to be penalized.

Employers with city contracts and more than nine employees are banned from asking anything about applicants’ criminal records at the risk of losing their contracts.

Fears of endangering employees and the public are behind opposition to the laws but murder, sex offenses, and voluntary manslaughter are not covered by this ordinance.

How California Employers Can Comply

California City employers should update applications and remove anything asking about criminal convictions and change their policies regarding which employees they can ask about criminal records. All California employers should ensure their background screening policies and procedures comply with the new laws and consult with legal counsel if they don’t understand any part of their legal obligations.

PAYDAY has various background searches available for employment purposes, tenant history, drug testing and more. Contact us for more information and to find out how to get started. 

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About the Author:

As Director of Operations, Jessica oversees the day-to-day operations for payroll, human resources, tax, finance and client affairs. She also plays an active role in formulating corporate strategy and developing client programs. Jessica believes a company’s success begins with its people. She strives to build a team encompassing excellence and professionalism, and to play a large role in developing the staff on an ongoing basis. Her passion for strong client relationships drives her in ensuring that clients receive the highest level of personal service and the best products in the industry. Jessica joined PAYDAY in 2004, and quickly advanced to Development Coordinator in 2006, when she took charge of Human Resources. She was promoted to Director of Operations in September, 2011.

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