Screening Intelligence That Matters

Pre-Adverse Action Letters - New California Law Goes into Effect
On January 1, 2018, California Government Code § 12952 goes into effect. § 12952 is yet another state law that regulates how employers can use criminal background checks in the hiring process. Although state laws governing this practice have become commonplace, § 12952 is unique in that it contains new requirements as to what a potential employer must include in a pre-adverse action letter to job applicants - beyond what the federal Fair Credit Reporting Act ("FCRA") already mandates. California employers should review their forms to ensure they comply with this new California requirement. When a potential employer is considering not hiring a job applicant based on information the employer learns from a criminal background check (among other types of background checks), the employer must follow the FCRA's pre-adverse action protocol. Under this protocol, the employer must provide the applicant with a copy of the background check and an FCRA summary of rights before making a final employment decision regarding the applicant. This gives the applicant the opportunity to review the background check and point out any errors he or she believes exist. Employers often deliver this information to applicants with a pre-adverse action letter, which typically informs the applicant about the possibility of adverse action. Importantly, the FCRA does not require any specific content in the pre-adverse action letter. The FCRA does not even require a letter at all. California Government Code § 12952 changes that for Californians. Under this new code section, the employer must provide the applicant with specific written notifications regarding the potential adverse action. These notifications include the following:

Notification that the employer has made a "preliminary decision that the applicant's conviction history disqualifies the applicant from employment;"

- Notification of the disqualifying conviction or convictions that are the basis for the preliminary decision to rescind the offer of employment;
- A copy of the conviction history report, if any; and
- An explanation of the applicant's right to respond to the notice of the employer's preliminary decision before that decision becomes final and notification of the deadline by which the applicant may respond. This explanation must inform the applicant that the response may include the submission of evidence challenging the accuracy of the conviction history report that is the basis for rescinding the offer, evidence of rehabilitation or mitigating circumstances, or both.

The employer may also explain its reasoning in making the preliminary decision, but that statement of reasoning is not required.

These pre-adverse action mandates are only a sampling of § 12952's new requirements. The legislation includes specific restrictions on when an employer can use criminal record information in the employment process, restrictions on the type of information an employer can use, and restrictions on the way an employer can use such information. The statute also includes specific requirements for the adverse action letter (as opposed to the pre-adverse action letter) above and beyond what the FCRA requires. With the new requirements poised to take effect, multistate employers should pay close attention to their pre-adverse action and adverse action letters to ensure they comply with this new California law. That is especially true here, as § 12952 is one of the first state laws to regulate the content of these letters.