Background checks are an essential part of the hiring process. However, the rules surrounding them can be hard to understand.
This is especially true for pre-employment background checks in California, which require special considerations.
Did you know that one in three Californians has a criminal history?
This means employers are virtually guaranteed to encounter previous convictions, arrests, and other considerations at some point in their hiring efforts.
To help you navigate employment background checks, we’ve compiled this comprehensive guide, which covers the legislation, requirements, and procedures you need to know about.
Let’s get started.
California Employment Background Check Laws 2022
Here’s a breakdown of the state’s various background check regulations, as they pertain to California employers:
The Fair Credit Reporting Act
The Fair Credit Reporting Act, or FCRA, exists to protect employers and applicants. Specifically, the FCRA promotes accuracy, fairness, and privacy for the information contained in consumer reporting agency files.
The FCRA is the national standard for employment background checks. For applicants, it guarantees the right to obtain a copy of the background check.
It also allows the applicant to file a dispute if the background check contains inaccurate or incomplete information.
California employers, like all employers, are required to follow FCRA guidelines. Today, federal FCRA guidelines apply when a hiring company uses background checks prepared by third-party providers.
In these cases, the employer must do the following:
- Provide the applicant with written notice that a background check and report may be required.
- Obtain the applicant’s permission to conduct a background check via an authorization form.
- Obtain specific permission if the job requires the collection of medical information.
- Provide notice if the employer intends to use the applicant’s neighbors, friends, or associates as character references, or if the employer will interview these people about the applicant’s “character, general reputation, personal characteristics, or mode of living.” The FCRA calls this process an “investigative consumer report.”
- Notify the applicant if the information contained in a background check is used to make an adverse hiring decision.
If an employer compiles a background check report on its own, FCRA provisions do not apply.
ICRAA/CCRAA
According to a 2018 California Supreme Court ruling known as Connor v. First Student, Inc., both the Investigative Consumer Reporting Agencies Act (ICRAA) and the Consumer Credit Reporting Agencies Act (CCRAA) now apply to certain employer background checks.
Because of this, employers may need to comply with both laws, in addition to ensuring their background checks remain compliant with all applicable federal and state laws.
Here’s what you need to know about the ICRAA and the CCRAA.
The ICRAA
The ICRAA (Investigative Consumer Reporting Agencies Act) has specific notification requirements, reporting restrictions, and more.
The ICRAA contains several clauses that are stricter than the FCRA. The ICRAA supersedes the FCRA in any provision where its laws are more restrictive.
Section 1786.18 of the ICRAA, for example, only allows for the reporting of criminal convictions and open cases. The ICRAA also establishes restrictions about when and how employers can generate background check reports.
According to Section 1786.16 (2)(B)(iv):
Any person described in subdivision (d) of Section 1786.12 shall not procure or cause to be prepared an investigative consumer report unless the following applicable conditions are met:
(2) If at any time, an investigative consumer report is sought for employment purposes other than suspicion of wrongdoing or misconduct by the subject of the investigation, the person seeking the investigative consumer report may procure the report, or cause the report to be made, only if all of the following apply:
(B) The person procuring or causing the report to be made provides a clear and conspicuous disclosure in writing to the consumer at any time before the report is procured or caused to be made in a document that consists solely of the disclosure, that:
(iv) Identifies the name, address, and telephone number of the investigative consumer reporting agency conducting the investigation.
Additionally, ICRAA requires adherence to the 7-year rule. It “limits the conviction information to seven years from the date of disposition, release, or parole…regardless of the subject’s anticipated salary.”
This is important since more general 7-year limitations under FCRA only apply to employees who make less than $75,000.00 annually.
The ICRAA goes on to clarify (in Section 1786.29) that investigative consumer reporting agencies must provide a series of notices on the first page of the investigative consumer reports they generate.
Notably, the section requires reporting agencies to include a notification (in 12-point boldface type) that the report does not guarantee the accuracy or truthfulness of its information.
It also requires the notice to disclose that the information within the report comes from the public record, and that identity theft and criminal activity may alter the accuracy of the results.
The ICRAA lays out additional requirements for investigative consumer reporting agencies in Section 1786.22, which compliance-minded employers should read in full.
CCRAA
The CCRAA follows alongside ICRAA in most ways but deviates concerning credit reports. According to CCRAA Section 1785.20.5, credit reports and investigative consumer reports are considered background reports.
This section states the following:
“The report to the user and to the subject of the report shall be provided contemporaneously and at no charge to the subject person.”
CIPA
The California Information Privacy Act, or CIPA, (Cal. Civil Code §§ 1785 et seq.) takes the minimum employee privacy protections set forth by the FCRA and expands on them.
Like FCRA, CIPA establishes strict requirements for employers who hire third-party companies to conduct their background checks, as opposed to employers who choose to do it themselves.
For employers who DIY their investigations, CIPA requires the employer to give applicants the option to “opt-in” to receive a copy of their background check reports.
The checkbox must be located either in the job application or in the written notice of the background check, which is required by FCRA. If the applicant does opt-in, he or she must receive a copy of the report within three days of when the employer receives them.
If the employer chooses to hire a third-party agency to conduct background checks, CIPA requires the employer to issue what it calls a “clear and conspicuous” notice.
This notice must be in writing and must cover the “nature and scope” of the background check [Cal. Civil Code § 1786.16(2)(B)(v)].
If the employer’s third-party background check company also intends to interview the applicant’s references, the employer must:
- State the purpose of the investigation.
- Give the applicant contact information for the investigation agency.
- Give the applicant a summary of their rights to see and copy any reports about them.
- Provide the applicant with a checkbox they can check if they want to receive a copy, which must then be sent to the applicant within three days of the employer receiving the completed report.
There is one notable exception. If the employer is conducting a background check because they suspect the applicant has engaged in wrongdoing or misconduct, CIPA waives the requirement to provide notice and obtain the applicant’s consent for the background check.
CA Labor Code 432.7
According to CA Labor Code 432.7, California employers, either public or private, are prohibited from asking a job applicant about some aspects of their criminal history, including the following:
- Criminal charges that did not end in a conviction.
- Pre-trial or post-trial diversion programs.
- Dismissed or sealed convictions.
It is also prohibited for a company to make hiring decisions based on the factors above. California employers are, however, permitted to ask about any currently pending criminal charges.
Redaction of Birthdates on Court Records
California employers need to know about the Court of Appeal’s decision in All of Us or None of Us v. Hamrick, Cal. Ct. App., 4th Appellate Dist., 1st Div. No. D076524 (2021).
The Court of Appeal reversed the trial court’s decision that court clerks do not have to redact dates of birth and driver’s license numbers from court records.
When the lower court received the case back, it then ruled on behalf of the plaintiffs, holding that as a matter of law, courts must redact birthdates and driver’s license numbers from court records.
The California Supreme Court denied a review of the decision. This means that courts will have to redact all personal identifiers from criminal court records other than names.
This change will immediately impact employment background checks in the state since consumer reporting agencies must rely on a minimum of two identifiers to verify that a criminal record belongs to an applicant.
Unverifiable criminal history information cannot be reported.
While the change will make employment background checks more difficult, iprospectcheck has already adapted new methods and processes to this decision.
We will still be able to provide reliable criminal history reports about applicants who have lived or worked in California to employers despite this change.
Ban the Box and Fair Hiring Laws
Today, Ban the Box laws only apply to public sector employers in California. Under these laws, public employers may only inquire into an applicant’s criminal records after they have determined that the applicant meets the minimum requirements for the position in question.
Among other provisions, “Ban the Box” became the law in California with the passage of The
California Fair Chance Act AB1008, which seeks to provide candidates with criminal histories an equal opportunity to advance through the application process.
Essentially, the Fair Chance Act requires an employer to evaluate an applicant’s qualifications before conducting a criminal background check. The law prohibits California employers from asking about criminal histories or felony convictions before they issue a job offer.
What Does a California Background Check Show?
Employers in California can ask for pre-employment background checks from iprospectcheck that include the customized information they need.
However, most employers ask for several common types of information about the backgrounds of their prospective employees, including information about any criminal histories, prior employment records, educational records, and credentials.
Depending on the nature of the position, other types of information might also be requested.
1. Criminal Records
If one of your job applicants has a criminal record, you might see the following types of information on a pre-employment background check in California:
- Criminal charge or charges
- Date of filing
- Disposition of the case
- Disposition date
- Offense level
- Sentencing information
2. Employment verification
One of the most important things you can request on a pre-employment background check is employment verification.
Verifying your applicants’ claims about their employment histories can help you ensure that you hire trustworthy employees and prevent potential negligent hiring claims.
It also helps you determine whether they might have embellished their levels of experience or have made false claims.
When you request employment verification, the background check will show you the dates that a candidate worked at each job and any positions that he or she held.
3. Education verification
If the position for which you are hiring requires a certificate, degree, or another educational qualification, verifying the educational records of your candidates can be critical.
Some candidates may claim to have degrees that they have not completed. Others sometimes purchase degrees online from vendors that do not require them to take any classes.
Through education verification, you can verify the institutions your candidates attended, the dates, and any degrees or certificates they earned.
4. Credentials verification
If your open position requires that your candidates possess specific professional credentials or licenses, a California pre-employment background check can include verification of their credentials.
Requesting this type of verification can help you to ensure that your employees have the requisite qualifications for their jobs and help your company to avoid negligent hiring claims.
How Do I Obtain a Background Check for Employment in California?
The California Department of Justice is mandated to maintain a statewide repository for criminal records.
Before you can secure criminal record information for your applicants, your company must first apply to become an authorized applicant agency with the DOJ.
Once the request has been submitted, your company will have to wait to receive authorization of approval.
Then, you will need to obtain written consent from your applicants on a specific form from the department.
Your applicants will have to get their fingerprints scanned by a Live Scan operator.
The fee is $32, which does not include the fingerprint rolling fees charged by the Live Scan operator.
Getting background information from the state will not provide you with all the information that you need. You will only obtain criminal records if any exist.
These checks do not return information about the educational or employment histories of applicants and will not provide you with a comprehensive picture of their backgrounds.
State criminal records might also not provide you with information about convictions that occurred outside of the state.
Some employers attempt to search court records in every jurisdiction in which an applicant has lived. However, this wastes valuable time for your human resources department and is very labor-intensive.
The best option is to request pre-employment background checks from a trusted partner like iprospectcheck. When you work with us, you can choose the specific types of information you need instead of getting extraneous results.
You can also feel confident that your pre-employment background checks will fully comply with all of the state and federal laws so that you do not rely on information for employment decisions that could get you in trouble.
What Disqualifies You on a Background Check in California?
Applicants might be turned down for jobs based on information contained in their background checks for multiple reasons.
Some of the most common reasons are described below.
1. Failing a Pre-Employment Drug Screen
Some employers condition offers of employment on passing pre-employment drug screens. These types of tests are requested to protect workplace safety.
If a candidate fails a pre-employment drug test, the employer will likely withdraw the conditional offer of employment.
2. Lying About Past Employment
A common reason why employers might decide against hiring applicants following completing background checks is discovering that they have lied about their past employment.
Some applicants try to embellish their experience by claiming to have held positions of greater responsibility or fudging their employment dates to hide gaps.
Employers that request education verification checks can easily spot these types of lies.
3. Lying About Education
Another common problem that can result in being denied employment is trying to lie about attending prestigious institutions or obtaining degrees that the applicants never earned.
Employers that request education verification checks can see these types of lies and will likely decide against hiring applicants who lie.
4. Having Disqualifying Criminal Convictions
Many people have criminal records and are still able to find jobs. A criminal conviction is not necessarily disqualifying.
However, when people apply for jobs for which the types of convictions they have that disqualify them because they directly relate to the tasks they might be asked to perform, an employer can base an adverse hiring decision on the conviction after individually assessing the conviction and completing the adverse action process.
5. Having a Bad Driving Record
People who apply for jobs that involve driving, such as truck driver positions, will likely have to undergo checks of their driving records.
If they have too many traffic violations or major traffic offenses on their records, the employers will likely turn them down.
This is because the employers might not be able to insure them, and hiring people with bad driving records to drive could expose the employers to negligent hiring liability.
Do Pending Charges Show Up on a Background Check in California?
Under CA Labor Code 432.7, California employers cannot ask about an applicant’s previous arrests that did not result in convictions, sealed or dismissed convictions, or any completed diversions.
However, it is not illegal for employers to ask about pending criminal charges, and they might show up on California background checks.
As a California Employer, How Can I Stay Compliant?
Complying with laws like the Federal Fair Credit Reporting Act is critical, but even that is not enough to run a compliant screening program in California.
The penalties for violating California background check laws are severe.
In some cases, employers can be required to pay actual damages, or up to $10,000 per violation, in addition to the applicant’s attorney’s fees and costs.
Some courts may require employers to pay punitive damages, as well, which can be as much as ten times the amount of actual statutory damages.
With that in mind, here are four tips to remain compliant on background check laws in California, and avoid expensive fees:
1. Wait to Inquire About Criminal History
To protect yourself and your company, wait to inquire about an applicant’s criminal history until after you have issued a conditional offer of employment.
This includes asking applicants if they have ever been convicted of a crime, ordering a background check, or making other inquiries into an applicant’s criminal history.
2. Conduct Individualized Assessments
If an applicant has prior convictions, conduct an individualized assessment to determine whether those convictions have a direct, adverse relationship with the job’s specific duties.
If so, this would justify the denial of the candidate’s application.
3. Notify the Applicant of Potential Adverse Action
If you intend to take adverse action based on the findings of a criminal background check, you must notify the applicant.
Your notice must include the following elements:
- An identification of the conviction.
- A copy of the conviction history report – regardless of whether you prepared it internally or had it developed by a third-party company.
- Notification of the applicant’s deadline to provide clarifying information for the background check, such as evidence of inaccuracy, or rehabilitation documentation.
4. Provide a Final Adverse Action Notice
If you ultimately proceed with adverse action, you must notify the applicant of your final decision.
You must also make the applicant aware of their right to challenge the decision, request reconsideration, and file a complaint with the Department of Fair Employment and Housing.
While complying with California background check laws can be challenging, following these guidelines can help you avoid issues.
Keep in mind that, in addition to federal and state laws, Los Angeles and San Francisco have enacted their own versions of California “Ban the Box” laws.
Los Angeles, for example, passed an ordinance that applies to all city businesses with ten or more employees, as well as all city contractors.
The law states that employers cannot investigate an applicant’s criminal history until after they’ve issued a conditional offer of employment.
Additionally, employers must conduct an individual assessment of the applicant’s criminal background as it relates to the responsibilities and duties of the open position.
Can I Consider an Applicant’s Criminal Background During the Hiring Process?
Yes – with some exceptions. While employers are permitted to run background checks on applicants, they must adhere to California labor laws regulating when and how to conduct said background checks.
Additionally, California law requires employers to disclose certain information after they run a background check. Employers who want to remain compliant must familiarize themselves with these regulations and how to abide by them.
Sample California Background Check Policy
It’s important to have a background check policy in place to ensure consistency in your testing program and avoid violating the law. When you have a strong policy in place, you can ensure that your background screens comply with all relevant laws.
Here’s a sample California background check policy to use as a reference.
[COMPANY NAME] Background Check Policy
Purpose
The goal of [COMPANY NAME] is to hire and promote the most highly qualified candidates. Background checks are an integral part of the hiring and promotion processes. When [COMPANY NAME] needs to conduct a background check to make hiring and other employment decisions, the background check will be conducted and the information revealed will be used in compliance will all relevant local, state, and federal laws.
Scope of Background Checks
All applicants and employees will undergo background checks during the hiring process or when the company makes other employment decisions.
Procedures
Background Checks
[COMPANY NAME]’s background checks are conducted in a manner that complies with all relevant state and federal laws, including the Fair Credit Reporting Act (FCRA), the California Consumer Credit Reporting Agencies Act (CCRAA), and the California Investigative Consumer Reporting Agencies Act (ICRAA) as follows:
Before applicants or employees will undergo background checks, [COMPANY NAME] will provide advanced written notices of its intent to conduct background checks and will provide the applicants and employees with an opportunity to receive a free copy of any reports. Background checks will not be conducted until the company obtains signed authorization from the employees and applicants granting their consent for the company to conduct background checks.
Consumer Credit Reports
Consumer credit reports are obtained by [COMPANY NAME] under limited circumstances but are not in most cases. For example, the company might request a consumer credit report for an applicant or an employee who is being considered for a supervisory position in which the job duties include having access to the company’s credit card account or bank account information. If the company needs to request a consumer credit report, it always follows the relevant state and federal laws.
Confidentiality and Use of Information
[COMPANY NAME] will only use the information received from background checks to make employment decisions. All background check information obtained will be maintained confidentially and in compliance with all laws. Background check reports can only be accessed or reviewed by designated and authorized individuals who have the approval of Human Resources. Information from background check reports will not be disseminated to the public or other employees.
To receive more information about [COMPANY NAME]’s background check policy, contact Human Resources.
How Far Back do Employment Background Checks go in California?
In California, criminal convictions can only be reported for seven years. Under California civil code (The Investigative Consumer Reporting Agencies Act), any misdemeanors, complaints, indictments, arrests, and convictions older than that cannot be reported on background checks.
Full pardons, expungements and arrests that did not lead to a conviction, meanwhile, cannot be reported at all.
According to California law (Article 2 of Civil Code 1427-3237), employers must save all employment background checks for a minimum of two years. The code states:
Every investigative consumer reporting agency that provides an investigative consumer report to a person other than the consumer shall make a copy of that report available, upon request and proper identification, to the consumer for at least two years after the date that the report is provided to the other person.
How Long Does a Background Check Take in California?
The method you choose for completing pre-employment background checks will affect how long it will take before you can expect to receive the results.
When you use the fingerprint background check from the California Department of Justice, the results can take seven days or longer, not including the time it takes for your applicant to get his or her fingerprints scanned by a Live Scan operator.
If you opt to search local court records yourself, it can take a very long time. This type of process can take weeks under normal circumstances. The COVID-19 pandemic might make it take even longer because of court closures.
At iprospectcheck, we can return background check reports very quickly in most cases, depending on the information you request. In some cases, you can receive your reports within a few hours or up to two days.
Because of delays caused by the pandemic caused by court and agency closures, our reports might be delayed. We will communicate with you about any potential delays so that you know what to expect.
iprospectcheck: Your Trusted Partner for Fast, Accurate, Compliant California Background Checks
Properly conducted pre-employment background checks can protect your business and its reputation. When you conduct a background check on an applicant, you must make sure that you follow all of the applicable laws.
At iprospectcheck, we work to remain up to date with changes to the laws as they occur. Our team members are thoroughly trained and know the requirements they must follow when they conduct pre-employment background checks and send reports to our clients.
To learn more about our pre-employment background checks and how we can help you, contact iprospectcheck today to schedule a no-obligation, free consultation or call (888) 509-1979
DISCLAIMER: The resources provided here are for educational purposes only and do not constitute legal advice. Consult your own counsel if you have legal questions related to your specific practices and compliance with applicable laws.
