Changing laws mean changing employment applications and background checking processes and procedures. From inclusion of "genetic information" in the application's EEO statement, to ensuring the convictions section does not run afoul of various "ban the box" rules (which prohibit employers from asking about convictions at certain points during the hiring process), employers must be careful that their employment applications do not get them into trouble.
Many employment applications ask about an applicant's criminal history. A few states and cities around the country have enacted "ban the box" laws that prohibit employers from inquiring about criminal history (including asking if the applicant has ever been convicted of any crime) during the application process. Some, such as Massachusetts, simply restrict employers from making such an inquiry at the pre-interview stage (i.e., on the application). Others, such as Philadelphia, Pennsylvania, have enacted laws banning such inquiries during the entire "application process," which ends only when the employer has "accepted [the applicant's] employment application." "Ban the box" legislation has also been introduced in New York State. While many existing "ban the box" laws apply only to public employment, some apply to private employers as well.
Finally, even in states that have not "banned the box," pursuant to applicable law, employers are limited in the type of information that can be inquired about, or reviewed in connection with, an application for employment. For example, many states prohibit employers from inquiring about (or from taking action based on) arrests; convictions that have been expunged, annulled, or erased; or even actual convictions if they do not specifically relate to the job being applied for. In any event, you should check the applicable law on these points in all jurisdictions where you hire employees to ensure that your employment applications and hiring practices are up to date.
Further, as you are likely aware, pursuant to the federal Fair Credit Reporting Act ("FCRA"), prior to using a third party to perform a background check, employers must obtain authorization from applicants. This authorization form must be a separate document, and not simply part of the employment application. Various states also have their own fair credit laws, which may include other requirements, sometimes with respect to the wording on the authorization form, whether the applicant must be given the option to obtain a copy of any background check information received by the employer, or whether additional information must be provided to the employee when the company decides to take action against the applicant (i.e., a decision not to hire).
Further, as Epstein Becker Green attorney Frank Morris reported last month, the FCRA was amended to include certain rules about the use of credit information in hiring decisions. In addition, several states, such as Hawaii, Illinois, Oregon, and Washington, have enacted legislation limiting the right of employers to use an applicant's credit history in hiring decisions. Several other states have similar legislation pending, as does the United States, in the form of the Equal Employment for All Act, which was introduced in 2010, and again in 2011.