Employers in New York may need to take certain actions because of new laws regarding background checks and social security numbers.

Employee Background Checks

Effective February 1, 2009, whenever an employer in New York conducts background checks on applicants or employees that may disclose criminal convictions, the employer must provide these applicants or employees with specific notice regarding their rights under Article 23-A of the New York Correction Law1. Article 23-A prohibits an employer that employs ten or more persons from making adverse hiring or employment decisions against applicants or employees based on a previous criminal conviction unless (i) there is a “direct relationship” between the criminal conviction and the employment sought (based on consideration of factors specified in the statute) or (ii) the employment would “involve an unreasonable risk to property or to the safety or welfare of specific individuals or the general public.” The New York State Human Rights Law also makes it an unlawful discriminatory practice to deny employment to an ex-offender merely because of his or her prior convictions or by a finding that his or her criminal record indicates a lack of “good moral character” where such a denial violates Article 23-A.

As such, pursuant to amendments to the New York General Business Law and New York Labor Law, employers in New York must now provide copies of Article 23-A to any applicants or employees for whom the employers will obtain investigative consumer reports and also post a copy of Article 23-A and any regulations pursuant to it in a “place accessible to . . . employees” and in a “visually conspicuous manner.” In addition, if the investigative consumer reports actually disclose information regarding criminal convictions, the employers must provide the applicants or employees with additional copies of Article 23-A.

In connection with the above, the New York State Human Rights Law was also amended to provide that there will be a rebuttable presumption in favor of excluding evidence of an employee’s prior criminal conviction(s) or incarceration in any case alleging negligent hiring, negligent retention or negligent supervision if the employer has complied with Article 23-A by considering the specified factors and making a reasonable, good faith determination that the factors weighed in favor of hiring or retaining the applicant or employee.

Privacy Rights—Social Security Numbers and Other Personal Identifying Information

Effective January 3, 2009, an amendment to the New York Labor Law restricts the use and disclosure of employee social security numbers and other “personal identifying information” by employers in New York. Specifically, employers may not: (i) post or display employees’ social security numbers; (ii) visibly print such numbers on any identification badges, including time cards; (iii) place such numbers in files with unrestricted access; or (iv) communicate employees’ “personal identifying information” to the public. Personal identifying information includes an employee’s “social security number, home address or telephone number, personal electronic mail address, Internet identification name or password, parent’s surname prior to marriage, or drivers’ license number.” Employers are subject to a civil penalty of up to US$500 for any “knowing violation” of the law. The failure to adopt policies or procedures to safeguard against such violation, including adopting procedures to notify relevant employees of this amendment, will be presumptive evidence that a violation of the law was “knowing.”2 As always, White & Case would be pleased to assist you in complying with these new New York laws.