Article
1.1. Unlawful Practices, Conviction History
12954.2.
This article shall be referred to, and may be cited, as the Fair Chance Act of 2023.12954.2.01.
For purposes of this article, the following definitions apply:(a) “Adverse action” includes, but is not limited to, adverse employment action.
(b) “Applicant” means any individual applying for employment or promotion.
(c) “Arrest history” means any document or record that discloses or includes any information regarding a prior arrest or arrests, regardless of whether the arrest or arrests led to a formal charge or conviction.
(d) (1) “Conviction” has the same meaning as defined in paragraphs (1) and (3) of subdivision (a) of Section 432.7 of the
Labor Code.
(2) Notwithstanding paragraph (1), “conviction history” includes:
(A) An arrest not resulting in conviction except in the specific, limited circumstances described in subdivision (f) of Section 432.7 of the Labor Code, when an employer at a health facility, as defined in Section 1250 of the Health and Safety Code, may ask an applicant for certain positions about specified types of arrests.
(B) An arrest for which an individual is out on bail or their own recognizance pending trial.
(e) “Employee” means an employee, unpaid intern or volunteer, independent contractor or any other individual providing services pursuant to a contract, and freelancer.
(f) “Employer” has the same
meaning as in paragraph (2) of subdivision (a) of Section 12945.7, as that section read on January 1, 2023, and includes any direct and joint employer, any entity that evaluates the applicant’s conviction history on behalf of an employer, any staffing agency, and any entity that selects, obtains, or is provided workers from a pool or availability list.
(g) “Unlawful employment practice” has the same meaning as provided in subdivision (a) of Section 12940.
12954.2.02.
(a) It is an unlawful employment practice for an employer to do any of the following:(1) Declare, print, or circulate, or cause the declaration, printing, or circulation of, any solicitation, advertisement, or publication for employment or promotion that states any limitation or specification regarding conviction history, even if no adverse action is taken against the individual seeking employment or promotion. This includes, but is not limited to, advertisements and employment applications containing phrases such as “no felonies,” “background check required,” and “must have clean record.”
(2) Include on any application for employment or promotion, or directly or indirectly
ask the applicant any question that seeks the disclosure of an applicant’s conviction history.
(3) Inquire into, directly or indirectly ask the applicant, or consider the conviction history of the applicant, including any inquiry about conviction history on any employment or promotion application, except as provided in subdivision (b).
(4) (A) End an interview, reject an application, or otherwise terminate the employment or promotion application process based on conviction history information provided by the applicant or learned from any other source.
(B) An applicant volunteering conviction history information shall be immediately notified, in writing, by the employer of their rights not to disclose conviction history information under this article. An employer shall disregard conviction
history information learned about the applicant and shall take reasonable steps to prevent further disclosure or dissemination of the applicant’s conviction history.
(5) Make an adverse decision based on the applicant’s response, including denial of conviction history, to a question, inquiry, or voluntary disclosure regarding the applicant’s conviction history in paragraphs (2) to (4), inclusive.
(6) Require self-disclosure of an applicant’s conviction history at the time of, or any time after, a conditional offer of employment or promotion.
(7) Require or request that an applicant share any personal social media. The employer shall not inquire into, consider, distribute, disseminate, obtain, or use any arrest or conviction history information from social media, the internet, or any other source.
(8) Inquire into, directly or indirectly ask the applicant, consider, distribute, or disseminate information about any of the following while conducting a conviction history background check in connection with any application for employment or promotion:
(A) Arrest not followed by conviction, except in the circumstances as permitted in paragraph (1) of subdivision (a) and subdivision (f) of Section 432.7 of the Labor Code.
(B) Referral to or participation in a pretrial or posttrial diversion program.
(C) Convictions that have been sealed, dismissed, expunged, or statutorily eradicated pursuant to law, or any conviction for which the convicted person has received a full pardon or has been issued a certificate of rehabilitation.
(9) To interfere with, restrain, or deny the exercise of, or the attempt to exercise, any right provided under this article.
(10) Take adverse action on the basis of a delay in obtaining, or failure to obtain, any information described in subdivision (b).
(b) (1) (A) Subject to the requirements of this subdivision, paragraph (3) of subdivision (a) shall not be construed to prohibit an employer from conducting a conviction history background check in the following circumstances only:
(i) The employer is required to obtain, pursuant to Section 1829 of Title 12 of the United States Code or pursuant to any other federal law, federal regulation, or state law, information regarding the particular conviction of the
applicant.
(ii) An individual with a particular conviction history is prohibited by federal or state law from holding the position sought by the applicant, regardless of whether that conviction has been expunged, judicially ordered sealed, statutorily eradicated, or judicially dismissed following probation.
(iii) The employer is prohibited by federal or state law from hiring an applicant who has that particular conviction, regardless of whether that conviction has been expunged, judicially ordered sealed, statutorily eradicated, or judicially dismissed following probation.
(B) For purposes of this subdivision, “particular conviction” means a conviction for specific criminal conduct or a category of criminal offenses prescribed by any federal law, federal regulation, or other state law that contains requirements,
exclusions, or both, expressly based on that specific criminal conduct or category of criminal offenses.
(2) This article shall not be construed to prohibit any employer that is required by federal or state law to conduct conviction history background checks for employment purposes or to restrict employment based on conviction history from complying with those requirements, or to prohibit the employer from seeking or receiving an applicant’s conviction history report that has been obtained pursuant to procedures otherwise provided for under federal or other state law.
(3) An employer that conducts a background check under the circumstances described in paragraph (1) or (2) shall not inquire into, directly or indirectly ask the applicant, or consider the conviction history of the applicant until after the employer has made a conditional offer of employment to the applicant, unless
the employer is required by federal law, federal regulation, or other state law to make the inquiry prior to making the conditional offer of employment.
(4) Any background screening process conducted as required in paragraph (1) shall be done in compliance with the individualized assessment, notification, and other requirements described in Section 12954.2.03.
12954.2.03.
(a) An employer authorized to conduct a conviction history background check pursuant to subdivision (b) that intends to deny an applicant a position of employment or promotion solely or in part because of the applicant’s conviction history shall make an individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with one or more specific duties of the job documented pursuant to paragraph (1) of subdivision (c) of Section 12954.2.06 that justify denying the applicant the position. In making the assessment described in this subdivision, the employer shall consider all of the following:(1) The nature and gravity of the offense or conduct.
(2) The time that has passed since the offense or conduct.
(3) The nature of the job held or sought.
(b) An employer shall commit the results of this individualized assessment to writing and shall provide a written copy of the assessment to the applicant with the preliminary decision in subdivision (d). To justify denying the applicant the position or promotion, the individualized assessment shall demonstrate that one or more specific elements in the nature and gravity of the offense or conduct in the applicant’s conviction history have a direct and adverse relationship to one or more specific elements in the nature of the job held or sought.
(c) (1) Where the applicant is currently not incarcerated or has completed a sentence for the conviction of a crime, a rebuttable presumption
is established that there is no direct and adverse relationship between the applicant’s conviction and the position and that the applicant does not pose a risk to public safety in ordinary circumstances.
(2) The receipt or possession of a benefit, privilege, or right, including, but not limited to, a license, certificate, authorization, or any other similar credential, or the grant of a criminal record exemption for the type of position offered by the employer, from a licensing, regulatory, or other government agency or board establishes that there is no direct and adverse relationship between the applicant’s conviction history and the position.
(3) For purposes of this subdivision, “completion of a sentence” shall not include parole, probation, supervised release, and any other form of supervision.
(d) (1) If the employer makes a preliminary decision that the applicant’s conviction history disqualified the applicant from employment or promotion, the employer shall notify the applicant of this preliminary decision in writing. That notification shall justify or explain the employer’s reasoning for making the preliminary decision.
(2) The notification shall contain all of the following:
(A) Notice of the disqualifying conviction or convictions and the specific duty or duties that are the basis for the preliminary decision to rescind the offer.
(B) A copy of the conviction history report or other source of the information.
(C) The written individualized assessment stating the direct and adverse relationship between the applicant’s conviction
history with the specific duties of the job, as described in subdivision (a).
(D) An explanation of the applicant’s right to respond to the notice of the employer’s preliminary decision before that decision becomes final and the deadline to respond. The explanation shall inform the applicant that the response may include 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.
(e) (1) The applicant shall have at least 10 business days to respond to the notice provided to the applicant under subdivision (d) before the employer may make its final decision. If, within the 10 business days, the applicant notifies the employer in writing that the applicant disputes the accuracy of the conviction history report that was the basis for
the preliminary decision to rescind the offer and that the applicant is taking specific steps to obtain evidence supporting that assertion, then the applicant shall have 5 additional business days to respond to the notice.
(2) The employer shall not request specific documents or evidence, including, but not limited to, police reports or other court documents, from the applicant in response to the notice of preliminary decision or at any other time. The employer shall not require, and it is an unlawful employment practice for the employer to require, that the applicant disclose their status as a survivor of domestic or dating violence, sexual assault, stalking, or other comparable statuses, or of the existence of a disability or disabilities.
(3) It shall be the applicant’s discretion to provide any documentation or information. An employer shall not disqualify an applicant from
the employment or promotion conditionally offered for failing to provide any specific type of evidence or documents.
(f) (1) The employer shall consider information submitted by the applicant pursuant to subdivision (e) before making a final decision.
(2) The employer shall conduct a second individualized assessment of whether the applicant’s conviction history has a direct and adverse relationship with the specific duties of the job that justify denying the applicant the position, assuming the information provided by the applicant is true and accurate. The employer shall not dispute the truth and accuracy of the new information provided by the applicant unless substantially inconsistent with other information obtained from a third party pursuant to this article or voluntarily provided by the applicant.
(3) The employer shall complete the second individualized assessment in writing.
(g) If an employer makes a final decision to deny an application for employment or promotion solely or in part because of the applicant’s conviction history, the employer shall notify the applicant in writing of all the following:
(1) The final denial or disqualification shall include the employer’s reasoning for making the final denial or disqualification pursuant to subdivision (f).
(2) Any existing procedure the employer has for the applicant to challenge the decision or request consideration.
(3) The right to file a complaint with the department.
(h) The employer shall not take an adverse
action, disadvantage the applicant, or fill the position during the process described in this section.
(i) The employer shall not revoke a conditional offer of employment or promotion on the basis of a delay in obtaining information necessary to comply with the requirements of this section.
12954.2.04.
Except as provided in subdivision (b) of Section 12954.2.02 for applications for employment or promotion, it is an unlawful employment practice for an employer to discriminate against or take adverse action against employees on the basis of their arrest or conviction history.12954.2.05.
(a) It is an unlawful employment practice for an employer to take adverse action against an employee or discriminate against an employee in the terms, conditions, or privileges of their employment based on their arrest or conviction history.(b) It is an unlawful employment practice for an employer to take adverse action against any employee by reason of the employee’s conviction of one or more criminal offenses, or by reason of finding the employee lacks good moral character based on the employee’s conviction of one or more criminal offenses.
(c) It is an unlawful employment practice for an employer to threaten an employee with any adverse action based on the employee’s
arrest or conviction history.
12954.2.06.
(a) An employer shall post a clear and conspicuous notice informing applicants and employees of this article and Section 432.7 of the Labor Code. The notice shall be posted in a conspicuous place at every workplace, jobsite, and other location under the employer’s control and visited by applicants or employees, and included in any job posting, solicitation, or advertisement seeking applicants for employment. The notice shall be posted in English, Spanish, and any language spoken by at least 10 percent of the employees at the workplace, jobsite, or other location at which it is posted.(b) An employer shall state in all solicitations or advertisements seeking applicants for employment that the employer will consider for employment qualified
applicants with conviction histories in a manner consistent with this article and other federal, state, and local laws.
(c) (1) An employer intending to conduct a conviction history background check for employment purposes, pursuant to the exception in subdivision (b) of Section 12954.2.02, shall do both of the following:
(A) Include in any job posting, solicitation, advertisement, and application a list of all specific job duties of the position with which a conviction may have a direct and adverse relationship potentially resulting in an adverse action.
(B) Include in any job posting, solicitation, advertisement, and application a statement that the employer is considering arrest or conviction history pursuant to the exception in subdivision (b) of Section 12954.2.02, and a list of all laws
and regulations that impose restrictions or prohibitions for employment on the basis of a conviction, if any.
(2) The materials required by this subdivision shall also comply with the notice and certification requirements in Section 1786.16 of the Civil Code.
12954.2.07.
(a) Employers and their agents shall retain all records and documents related to an applicant’s employment or promotion applications and the written assessment and reassessment performed pursuant to this article for a period of four years following the receipt of an applicant’s employment application.(b) Notwithstanding any law, employers and their agents shall, upon request, provide or provide access to the records and documents to the department in any administrative enforcement proceeding under this article or to the applicant.
(c) Any record or document retained or received by a local agency employer or the department pursuant to this section shall be confidential and
not subject to disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1). Nonidentifying information, however, may be used by the department for purposes of the annual report described in Section 12954.2.10.
12954.2.08.
(a) (1) The department shall issue rules and regulations, in conformity with the provisions of this article, regarding when an employer action constitutes a violation for purposes of imposing civil penalties set forth in this chapter and for purposes of the additional remedies and penalties set forth in Chapter 7 (commencing with Section 12960). These rules and regulations shall set forth whether each civil penalty, under paragraph (2) of subdivision (b), shall be issued on a per policy, per practice, or per applicant or employee basis.(2) The civil penalties provided for in this section are in addition to any other penalty or remedy provided by law, including additional remedies and penalties provided in this part,
and do not affect the right of an individual to file an action to recover damages and seek other remedies for a violation of any provision of this article.
(3) Notwithstanding other law, including Section 12954.2.09, an individual may also file an action to recover the civil penalties provided for in this article.
(b) For each violation, the following shall apply:
(1) The employer shall undergo mandatory training on the provisions of this article.
(2) The following civil penalties shall apply:
(A) For the first violation:
(i) For employers that employ 5 to 19 employees, a fine of up to one thousand dollars ($1,000).
(ii) For employers that employ 20 to 50 employees, a fine of up to two thousand dollars ($2,000).
(iii) For employers that employ 51 to 99 employees, a fine of up to three thousand five hundred dollars ($3,500).
(iv) For employers that employ 100 or more employees, a fine of up to five thousand dollars ($5,000).
(B) For the second violation:
(i) For employers that employ 5 to 19 employees, a fine of up to five thousand dollars ($5,000).
(ii) For employers that employ 20 to 50 employees, a fine of up to seven thousand dollars ($7,000).
(iii) For employers that
employ 51 to 99 employees, a fine of up to eight thousand five hundred dollars ($8,500).
(iv) For employers that employ 100 or more employees, a fine of up to ten thousand dollars ($10,000).
(C) For the third and subsequent violations:
(i) For employers that employ 5 to 19 employees, a fine of up to ten thousand dollars ($10,000).
(ii) For employers that employ 20 to 50 employees, a fine of up to fourteen thousand dollars ($14,000).
(iii) For employers that employ 51 to 99 employees, a fine of up to seventeen thousand dollars ($17,000).
(iv) For employers that employ 100 or more employees, a fine of up to twenty thousand
dollars ($20,000).
(c) (1) (A) The Fair Chance Act Enforcement Fund is hereby established in the State Treasury. Moneys in the fund shall be available to the department, upon appropriation by the Legislature, for purposes of administering and enforcing this article.
(B) The Fair Chance Act Recovery Fund is hereby established in the State Treasury. Moneys in the fund shall be available to the department upon appropriation by the Legislature for purposes of paying claims made by complainants under this article.
(2) The civil penalties described in subdivision (b) shall be collected by the department. The department shall remit any civil penalties awarded to the complainant pursuant to this subdivision.
(3) (A) Forty-six percent of the penalties shall be deposited in the Fair Chance Act Enforcement Fund and shall be used by the department for purposes of enforcing this article.
(B) Four percent of the penalties shall be placed in the Fair Chance Act Enforcement Fund for purposes of ensuring the employer pays the civil penalties to the department.
(C) The remaining 50 percent of the penalties shall be deposited in the Fair Chance Act Recovery Fund for purposes of making awards to the complainant or complainants, if any. Moneys in the fund shall only be used for paying a complainant’s claim and shall not be used for the department’s administrative costs to process and award claims. If there are no complainants, the remaining 50 percent shall be deposited in the Fair Chance Act Enforcement Fund for the purposes described in subparagraphs (A) and
(B).
(4) Civil penalties shall be assessed and recovered pursuant to the procedures in Section 12954.2.09.
12954.2.09.
(a) (1) To impose a civil penalty pursuant to this article, the department shall serve a citation on the employer. The citation shall include findings from the investigation that resulted in a determination that the employer violated the provisions of this article. The citation and findings may be served personally, in the same manner as provided for service of a summons, as described in Chapter 4 (commencing with Section 413.10) of Title 5 of Part 2 of the Code of Civil Procedure, by certified mail with return receipt requested, or by registered mail in accordance with subdivision (c) of Section 11505 of the Government Code or pursuant to Section 1013 of the Code of Civil Procedure. Each citation shall be in writing and shall describe the nature of the violation and findings of
the department, including reference to the statutory provision alleged to have been violated. The department shall promptly take all appropriate action, in accordance with this section, to enforce the citation and to recover the civil penalty assessed.(2) Any amount found due by the department as a result of a hearing shall become due and payable 45 days after written notice of findings, citation, and findings have been mailed to the party assessed. A writ of mandate may be taken from the findings and citations to the appropriate superior court within 45 days of service. The assessed party shall pay any judgment and costs ultimately rendered by the court against the party for the assessment. Notwithstanding other law, a court, in its discretion, may award to the prevailing party, including the department, reasonable attorney’s fees and costs, including expert witness fees, brought pursuant to this section, except that, notwithstanding Section
998 of the Code of Civil Procedure, a prevailing petitioner shall not be awarded fees and costs pursuant to the previous sentence, unless the court finds that defending against the action was frivolous, unreasonable, or without merit when the petition was brought, or the department continued to litigate after it clearly became so.
(3) As a condition to filing a petition for a writ of mandate, the petitioner seeking the writ shall first post a bond with the department equal to the total amount of the penalty assessed. The bond shall be issued by a surety duly authorized to do business in this state and shall ensure that the petitioner makes payments as set forth in this paragraph. If a decision is entered which affirms or modifies the amounts for civil penalties, the petitioner shall pay the amounts owed for the specified items included in a clerk’s judgment based on the decision, or pursuant to a court judgment in a writ of mandate proceeding
under paragraph (2). If the request for a writ is withdrawn or dismissed without entry of judgment, the petitioner shall pay the amounts owed for the specified items pursuant to the citation, unless the parties have executed a settlement agreement for payment of some other amount. In the case of a settlement agreement, the petitioner shall pay the amount they are obligated to pay under the terms of the settlement.
(4) If the employer fails to pay the amount owed within 10 days of the entry of judgment, dismissal or withdrawal of writ, or the execution of a settlement agreement, a portion of the undertaking, equal to the amount owed, or the entire undertaking if the amount owed exceeds the undertaking, shall be forfeited to the department for appropriate distribution.
(5) A person to whom a citation has been issued shall, in lieu of contesting a citation pursuant to this section,
transmit to the office of the department designated on the citation the amount specified for the violation within 45 business days after issuance of the citation.
(6) When no petition objecting to a citation or the proposed assessment of a civil penalty is filed, a certified copy of the citation or proposed civil penalty, may be filed by the department in the office of the clerk of the superior court in any county in which the person assessed has or had a place of business. The clerk, immediately upon the filing, shall enter judgment for the state against the person assessed in the amount shown on the citation or proposed assessment of a civil penalty.
(7) When findings and the order thereon are made affirming or modifying a citation or proposed assessment of a civil penalty after hearing, a certified copy of these findings and the order entered thereon may be entered by the
department in the office of the clerk of the superior court in any county in which the person assessed has property or in which the person assessed has or had a place of business. The clerk, immediately upon the filing, shall enter judgment for the state against the person assessed in the amount shown on the certified order as well as any reasonable attorneys’ fees and costs incurred by the department as determined by the court.
(8) A judgment entered pursuant to this section shall bear the same rate of interest and shall have the same effect as other judgments and be given the same preference allowed by the law on other judgments rendered for claims for taxes. The clerk shall make no charge for the service provided by this section to be performed by them.
(b) (1) A complainant entitled to an award of civil penalties under this section shall file a claim with
the department within three years after the civil penalty assessment on the employer becomes final.
(2) The department shall serve a copy of the complainant’s claim on the employer who was assessed the civil penalty.
(3) Following the submission of the claim, the department shall review the claim to determine if it has sufficient information to determine whether the complainant is entitled to recovery of civil penalties under this article.
(4) The department shall notify, in writing, the complainant of any deficiencies in the claim within 60 days of the department’s receipt of the claim.
(5) If the claim is granted, the complainant shall be paid up to 50 percent of the assessed civil penalty. If the application is denied, the complainant shall have the
right to refile the claim with any corrections and the original filing date shall serve as the operative filing date.
(6) Civil penalties shall be awarded and paid to a complainant who is granted a claim within 180 days of the department’s final review and determination of all claims related to the relevant civil penalty assessment.
12954.2.10.
The department shall annually publish a report containing statistics regarding the total number of penalties issued pursuant to this article. This report shall include information about the complainant’s demographics, including, but not limited to, race, national origin, gender, and disability status, employer size and type, and type of violation. The report shall ensure the report is published in a manner confidentiality of the complainants.12954.2.11.
The department shall adopt rules and regulations necessary to implement this article.12954.2.12.
The remedies under this section shall be in addition to, and not in derogation of, all other rights and remedies that an applicant or employee may have under any other law, including, but not limited to, any local ordinance, state, or federal law.