United States: Los Angeles Attorney Reviews California Background Check Laws

California employers that conduct background checks must navigate a wide range of legal requirements or face hefty penalties. Nuanced notice requirements apply to obtaining an employee's or prospective employee's consumer reports, criminal history and credit reports.

These requirements are not exclusive of each other and employers should take special care to comply with all requirements associated with the types of information sought.  

Investigative Consumer Reports 

Investigative consumer reports contain information on an individual's character, general reputation, personal characteristics or mode of living. 

Prior to requesting these reports, an employer must first notify the applicant/employee of its intent to obtain such report through a standalone, clear and conspicuous written disclosure containing only the following information:

  • A statement that the report may contain information about his/her character, general reputation, personal characteristics, and mode of living;
  • The use of this information for employment purposes;
  • The name, address, telephone number, and website of the reporting agency;
  • The investigation's nature and scope; and 
  • Notification that the applicant can view his/her file during normal business hours.

The employer must also provide the "Summary of Rights," also known as "A Summary of Your Rights Under the Fair Credit Reporting Act" to the applicant/employee and obtain a written authorization from him/her before obtaining the report. The authorization can be included in the disclosure statement and should provide a checkbox by which the applicant may elect to receive a copy of the report. 

If the employee/applicant elected to receive the report, the employer must request that a copy be provided within three business days. The report must contain the name, address and telephone number of the investigative consumer reporting agency. 

Finally, the employer is required to certify to the reporting agency that it has made the applicable disclosures, has received authorization and has complied with the copy distribution requirements.  

If the background check involves medical information, specific written consent from the applicant/employee must be obtained.  

Criminal History 

If the investigative report contains criminal history, the employer must comply with additional rules.

Employers with five or more employees are prohibited from inquiring about or considering criminal history prior to making a conditional offer of employment. Only after the conditional offer for employment is made can the employer seek this information by complying with the disclosure requirements outlined above. 

Notably, in making employment decisions, employers are banned from considering: arrests that didn't result in convictions (with limited exceptions); convictions that have been sealed, dismissed, expunged, or eradicated; juvenile convictions; convictions for most marijuana possession offenses more than two years old; or a referral to or participation in a criminal diversion program.

Additionally, employers cannot consider criminal information if doing so would have an adverse impact on hiring or retaining a protected class employee. 

Prior to making an employment decision based on a criminal conviction, an employer is required to conduct an "individualized assessment" to determine whether the specific offense is relevant to the job. 

Employers should check local ordinances for requirements regarding this assessment. If the employer chooses to rely on the conviction, it must issue a pre-adverse action notice informing the applicant of the disqualifying convictions and provide a copy of the report relied upon. 

The employer must also provide the Summary of Rights and inform the applicant/employee of his/her right to respond and provide rehabilitative or mitigating information, as well as the deadline to respond (at least five days). 

The employer must consider information provided by the employee prior to making its final employment decision. 

Once the decision is made, the employer must issue an adverse action notice informing the applicant/employee of its reliance on the conviction, the procedure for challenging the decision and a statement that the applicant/employee has the right to file a complaint with the Department of Fair Employment and Housing (DFEH). 

Credit Reports 

Unlike investigative consumer reports, credit reports more narrowly consist of information bearing on a person's credit worthiness, standing or capacity. California law prohibits employers from considering or acquiring credit reports, except for applicants for: 

  • Managerial positions meeting the executive exemption; 
  • Positions in the Department of Justice;  
  • Sworn peace officers; 
  • Positions for which information in the credit report is legally required to be disclosed;
  • Positions that involve regular access, for purposes other than routine solicitation and processing of credit card applications, to all of the following types of information: date of birth, Social Security number, and credit/bank account; 
  • Positions involving duties as a signatory on the bank or credit card account of the employer (not merely authorized to use the company credit card), having authority to transfer money or enter into financial contracts on the employer's behalf; 
  • Positions involving access to confidential or proprietary information; and
  • Positions involving regular access to cash totaling $10,000 or more during the workday. 

This ban however does not apply to consumer credit reports that verify income or employment and do not include credit information. 

Similar to investigative consumer reports, prior to obtaining credit reports, employers must provide a standalone, clearly written disclosure to the applicant/employee and obtain his/her authorization. 

The written disclosure must: (1) inform the applicant that the report will be used, (2) outline which of the above job exemptions applies, (3) identify the reporting agency and (4) provide a checkbox by which the applicant can elect to receive a copy. 

The employer must also provide the applicant/employee with the Summary of Rights. If the employee/applicant elects to receive the report, the employer must request that a copy be provided on the same day. 

The employer must certify to the credit reporting agency that it has made the applicable disclosures, has received authorization, and will not use the information in violation of any equal opportunity law. The employer must also certify that if it makes an adverse action based on the credit report, it will provide a copy of the report and the Summary of Rights to the applicant/employee.  

What Employers Should Do To Comply 

If an employer seeks information touching on both credit reports and investigative reports, the employer must comply with the notice requirements for both types of information. To aid in complying with background check laws employers should:  

  • Eliminate all questions related to criminal convictions on employment applications and during the interview process;
  • Never seek criminal history information from any source before a conditional offer for employment; 
  • Refrain from asking questions regarding an applicant's credit worthiness or salary history from references or prior employers;  
  • Ensure exempt classifications are accurate prior to requesting credit reports;
  • Treat all applicants and employees equally irrespective of any protected category;
  • Limit the scope of the investigation to employment related issues; 
  • Take special care when basing employment decisions on background problems that may be more common among persons of protected class; and
  • Ensure the pre-adverse action and adverse action notices are issued and compliant before basing an adverse employment decision on an investigative or credit report. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Lewis Brisbois Bisgaard & Smith LLP
Wilson Elser Moskowitz Edelman & Dicker LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Lewis Brisbois Bisgaard & Smith LLP
Wilson Elser Moskowitz Edelman & Dicker LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions