California Employers Using Background Checks Must Comply with Updates to Fair Chance Act

Originally enacted in 2018, the Fair Chance Act (FCA) is a California law that seeks to reduce barriers to employment for individuals with criminal histories. Due to updates to the law that took effect in October 2023, California employers who conduct background checks for employment purposes should revise their background check policies for compliance.

The California Fair Chance Act prohibits employers from asking about an applicant’s criminal history until after a conditional offer of employment has been made to the applicant. If an employer contemplates not hiring an applicant because of their criminal history, the company must perform an “individualized assessment” that considers the following factors:

• The nature and gravity of the offense or conduct.
• The time that has passed since the offense or conduct and/or completion of the sentence.
• The nature of the job held or sought.

If an employer does not want to hire an applicant after the assessment, a written notice must be sent to the applicant about potential adverse action and allow the applicant at least five (5) business days to respond [seven (7) business days in San Francisco]. If the employer still does not want to hire the applicant after a reassessment, a final notice must be sent notifying the applicant of the decision and their rights.

The California Civil Rights Department (CRD) offers a “Guide to Using CRD’s Sample Forms” that outlines the six (6) steps employers must follow when considering an applicant’s criminal history when obtaining a background check for employment purposes. Below are the six steps in the Fair Chance Act process and each CRD sample form that can be used by an employer.

1. Advertisement and Application Compliance Statement: This is a voluntary statement that employers can choose to add to job advertisements and applications regarding the Fair Chance Act.
2. Conditional Job Offer Letter (En Español): This sample letter can be used by an employer to make a conditional job offer and to notify the applicant that the employer intends to conduct a criminal background check.
3. Sample Individual Assessment Form (En Español): After making an applicant a conditional job offer and conducting a criminal background check, this sample form can be used by an employer to conduct the necessary individualized assessment of an applicant’s criminal history.
4. Preliminary Notice to Revoke Job Offer (En Español): If an employer intends to revoke a job offer because of the applicant’s criminal history, this sample letter can be used by an employer to meet its obligation to provide notice to the applicant.
5. Individual Reassessment Form (En Español): Once an employer notifies an applicant that it intends to revoke a job offer because of the applicant’s criminal history, the employer must give the applicant at least five (5) days to dispute the accuracy of the information and to provide mitigating information. This sample form can be used by an employer to conduct an individualized reassessment based on information provided by the applicant.
6. Final Notice to Revoke Job Offer (En Español): If after considering any information provided by the applicant, the employer still intends to revoke the job offer, this sample letter can be used by an employer to meet its obligation to provide notice to the applicant of that decision.

After updates to the law, “employer” includes “a labor contractor and a client employer; any direct and joint employer; any entity that evaluates the applicant’s conviction history on behalf of an employer, or acts as an agent of an employer, directly or indirectly; any staffing agency; and any entity that selects, obtains, or is provided workers from a pool or availability list.”

In addition, employers cannot advertise that people with a criminal history will not be considered for hiring and cannot consider information an applicant voluntarily offers about their criminal history prior to a conditional offer. The new regulations also provide a list of sub-factors that employers must consider at a minimum as part of the individualized assessment:

• The specific personal conduct of the applicant that resulted in the conviction.
• Whether the harm was to property or people.
• The degree of the harm (e.g., amount of loss in theft).
• The permanence of the harm.
• 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, and if so, whether the likelihood of harm arising from similar conduct could be sufficiently mitigated or eliminated by a reasonable accommodation, or whether the disability has been mitigated or eliminated by treatment or otherwise.
• Whether trauma, domestic or dating violence, sexual assault, stalking, human trafficking, duress, or other similar factors contributed to the offense or conduct.
• The age of the applicant when the conduct occurred.
• The amount of time that has passed since the conduct underlying the conviction, which may significantly predate the conviction itself.
• When the conviction led to incarceration, the amount of time that has passed since the applicant’s release from incarceration.
• The specific duties of the job.
• Whether the context in which the conviction occurred is likely to arise in the workplace.
• Whether the type or degree of harm that resulted from the conviction is likely to occur in the workplace.

The changes amend California Code of Regulations Section 11017.1 which regulates the consideration of conviction history in employment decisions. The CRD is also providing employers with Frequently Asked Questions (FAQs) about “Fair Chance Act: Criminal History and Employment” (En Español). For more information, visit CalCivilRights.CA.gov/Fair-Chance-Act/.

ClearStar is a leading global Human Resources technology company specializing in background checks, drug testing, and occupational health screening. ClearStar offers “better, easier, faster, and safer” workforce screening that complies with federal, state, and local laws regarding criminal background checks. To learn more about ClearStar, contact us today. 

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Thomas Ahearn - Digital Content Editor

Thomas Ahearn is a Digital Content Editor at ClearStar, a leading Human Resources (HR) technology company specializing in background checks, drug testing, and occupational health screening. He writes about a variety of topics in the background screening industry including Artificial Intelligence (AI), "Ban the Box," class action lawsuits, credit reports, criminal records, drug testing, Equal Employment Opportunity Commission (EEOC), Fair Credit Reporting Act (FCRA), Form I-9, identity theft, privacy, social media screening, and workplace violence.

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