This week, California's Governor, Jerry Brown, signed into law two bills that place California at the forefront of protecting employees while at the same time attempting to curtail the state's 12.1% unemployment rate. The first law - A.B. 22 - affords applicants for employment more protection by prohibiting employers from using pre-employment credit checks when making hiring decisions. Effective January 1, 2012, the new law prohibits employers, with the exception of certain financial institutions, from obtaining consumer credit reports for employment purposes unless the position of the person for whom the report is sought is (1) a position in the state Department of Justice, (2) a managerial position, (3) a sworn peace officer or other law enforcement position, (4) a position for which the information contained in the report is required by law to be disclosed or obtained, (5) a position that involves regular access to specified personal information, (6) a position in which the person is or would be a named signatory on the employer's bank or credit card account, or authorized to transfer money or enter into financial contracts on the employer's behalf, (7) a position that involves access to confidential or proprietary information, or (8) a position that involves regular access to $10,000 or more of cash. California joins Connecticut, Hawaii, Illinois, Maryland, Oregon and Washington, which have already imposed pre-employment credit check bans.
Meanwhile, in a move that bucks the national trend, Governor Brown signed into law the Employment Acceleration Act of 2011, which prohibits federal E-Verify mandates in California. While states and cities across the country have been passing laws that mandate the use of E-Verify as part of a strategy to curb illegal immigration and ensure that jobs go to U.S. citizens and legal residents, California has passed a law that would prohibit the state or a city, county, or special district from requiring an employer to use an electronic employment verification system except when required by federal law or as a condition of receiving federal funds. The legislation's stated purpose is to save companies money by decreasing the cost of doing business in a difficult economic climate.