On December 9, 2016, Los Angeles Mayor Eric Garcetti approved a new ban-the-box ordinance that will restrict how businesses in L.A. use and access the criminal history information of job applicants. Among other restrictions, the ordinance requires hiring managers to make a conditional job offer before asking an applicant about prior convictions. After the ordinance goes into effect on January 22, 2017, employers will have a six-month grace period before being subject to penalties and fines for violations.

The ordinance—also known as the Fair Chance Initiative for Hiring—adds article 9 to chapter XVIII of the L.A. Municipal Code. First proposed back in 2014, the ordinance is consistent with the nationwide trend of cities, counties, and states that have also advanced ban-the-box or fair-chance policies. For more information on this national trend, see our client briefings Ban-The-Box Legislation Continues, New York City Council Passes Ban-the-Box Legislation, and New Jersey and Philadelphia Ban-the-Box Legislative Update.

The new L.A. ordinance is described below.

What Employers are Covered?

The ordinance targets private employers that are located or doing business in L.A. and have 10 employees or more.

Covered employers must comply with the ordinance unless they satisfy one of the following four exceptions:

  1. Where the law requires the employer to obtain the conviction history of job applicants;
  2. Where the job requires the applicant to possess or use a firearm;
  3. Where the law prohibits persons with convictions from holding the relevant job position; or
  4. Where the law prohibits employers from hiring applicants with criminal convictions.

Employer Obligations Before the Job Offer

The ordinance imposes several requirements on covered employers before they can even interview a candidate. To start, every job advertisement and solicitation must clearly state that the employer will consider qualified applicants with criminal histories in accordance with the ordinance. Additionally, job application forms cannot include questions that seek information about an applicant’s criminal history. Specifically, application forms must not ask about prior felony or misdemeanor convictions for which the applicant was placed on probation, fined, imprisoned, or paroled.

The ordinance further prohibits employers from inquiring about an applicant’s criminal history unless and until a conditional offer of employment has been made. This includes any direct or indirect conduct intended to gather criminal history information about an applicant. For example, employers cannot seek criminal history reports from the Department of Justice (DOJ) or the Federal Bureau of Investigation (FBI) before making a conditional offer. Similarly, employers cannot ask about criminal history information during job interviews, phone-screening, or while checking references in advance of an offer.

Employer Obligations After the Job Offer

After extending a conditional offer of employment, employers are free to ask about criminal history information. However, employers will face further restrictions if they decide—based on that criminal history—that they want to withdraw the employment offer.

Before the employer can withdraw its offer, the ordinance requires employers to engage in a series of interactive steps with the applicant. First, the employer must conduct a written assessment that effectively links the specific aspects of the applicant’s criminal history with the risks inherent in the duties of the relevant job position. Second, the employer must give the applicant a copy of the written assessment, along with written notice of its intent to withdraw the offer. The employer must then give the applicant five business days to respond with additional information regarding the accuracy of the conviction or evidence of mitigating factors or rehabilitation.

If the applicant responds within five business days, the employer must consider the new information provided by the applicant, and conduct a second written assessment of the candidate’s fitness for the position. If the employer still wants to rescind its offer after this reassessment, it must notify the applicant and provide a written copy of the reassessment.

Recordkeeping Obligations

Employers are also subject to ongoing documentation obligations under the ordinance. For example, the ordinance requires that employers retain records and documents related to a candidate’s application for three years. This includes any written assessment and reassessments performed during the interactive process described above.

Enforcement and Penalties

The ordinance provides for both civil actions and administrative enforcement. Overseeing the administrative enforcement process is the Department of Public Works, Bureau of Contract Administration. Job applicants and employees can file civil actions only after exhausting an administrative procedure outlined in the ordinance.

Violations can result in penalties and administrative fines up to $500 for the first offense, up to $1,000 for the second, and up to $2,000 for the third and any subsequent violation.

Effective Date

The ordinance is scheduled to take effect on January 22, 2017. However, employers will have a six-month grace period—through July 1, 2017—before being subject to penalties and administrative fines. Prior to July 1, 2017, the Department of Public Works will issue written warnings to employers for violations.

Covered employers should consult with counsel and evaluate their policies and practices to ensure compliance with L.A.’s new ban-the-box ordinance.