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Employment Law Spotlight

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Background checks just became a little more complicated in San Francisco. Effective Aug. 10, amendments to the city’s Fair Chance Ordinance add new protections for certain out-of-state criminal records, establish additional response deadlines and increase the cost of noncompliance.

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Covered employers and affordable housing providers may not consider or rely on certain out-of-state arrests or convictions involving conduct that is lawful in California.

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Employers should update background-screening procedures, notices, templates and decision-making processes.

The amendments add deadlines to the adverse-action process and double administrative penalties for violations.

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The amended ordinance bars covered employers and affordable housing providers from considering or relying on out-of-state arrests or convictions arising from conduct that is lawful in California and relates to:

Step 1: Send the Pre-Adverse Action Notice

If an employer intends to take adverse action based on an applicant’s or employee’s conviction history, it must provide a copy of the background check report.

The individual then has seven days to submit evidence that the information is inaccurate, evidence of rehabilitation or other mitigating information. If the individual responds within that period, the employer must:

Confirm receipt of the information in writing within 14 days.

Delay the proposed adverse action for a reasonable period after confirming receipt.

Reconsider the proposed action in light of the information provided.

If the applicant or employee makes a reasonable factual showing that the proposed action is based solely on a conviction that is not directly related to the position, the employer must withdraw the proposed adverse action.

If the employer ultimately takes adverse action based on conviction history, it must notify the applicant or employee of the final decision.

The final notice must be sent within 30 days after the employer receives the individual’s response. If the individual does not respond, the employer must send the notice within 30 days after the pre-adverse action letter.

Penalties: Twice the Price of Getting It Wrong

The amendments double the administrative penalties for noncompliance:

First violation: $1,000, up from $500

Second violation: $2,000, up from $1,000

Each subsequent violation: $4,000, up from $2,000

Confirm whether the ordinance covers your workforce, including positions involving at least eight hours of work per week in San Francisco.

Review background check criteria to ensure protected out-of-state records are excluded from consideration.

Update job postings, pre-adverse action letters, final notices and internal checklists.

Build the seven-, 14- and 30-day deadlines into the hiring process.

Train recruiters, human resources personnel, hiring managers and third-party screening vendors on the new rules.

The bottom line: A background check should inform a hiring decision, not create a compliance problem. Our Labor and Employment Practice Group can help employers review their screening practices, revise forms and policies, and navigate the updated adverse-action process.

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