The Realities of ‘Ban the Box’

Employers must soon comply with the New Jersey Opportunity to Compete Act, and doing so requires careful adherence to rules.

By George N. Saliba, Managing Editor On Feb 16, 2015

Thousands of New Jerseyans have criminal histories ranging from serious felonies to garden-variety misdemeanors. While some persons are recidivist criminals unable or unwilling to learn from their mistakes, others’ indiscretions are literally in their pasts, and they have striven to overcome the serious ramifications of the immature bar fights they had at age 21, their decades-old drunk driving convictions or long-ago marijuana possession arrests. At what point does society render individuals a “new start” and a chance to compete in an increasingly competitive labor market? 

The New Jersey Opportunity to Compete Act, which takes effect March 1, forbids employers with 15 or more employees from asking job applicants about criminal histories on job applications and during initial interviews, with the logic that employers should objectively evaluate prospective employees before delving into – and potentially being negatively swayed by – their possible criminal histories.

The law exempts emergency services and law enforcement occupations, for example, but applies to most jobs ranging from restaurant service and sales, to physical-labor intensive positions and knowledge-worker occupations.

‘Ban the Box’ Basics

Beyond eliminating the question “Have you ever been convicted of a crime?” on job applications and similar verbiage in job advertisements, employers, again, must refrain from asking this or related questions during an initial job interview. The first interview need not occur in person (Skype and telephone interviews are acceptable), yet the interview should not be perfunctory, either. Once the first interview is complete – and assuming an employer is impressed enough to contact the prospective employee a second time – the employer can then legally inquire about criminal histories.

Mark Diana, office managing shareholder at the law firm of Ogletree, Deakins, Nash, Smoak & Stewart, P.C., explains, “The law makes it pretty clear that the format of the first interview doesn’t much matter. If someone conducts a genuine half-hour interview, that’s probably a legitimate length for an interview, for a lot positions. Then, bringing someone back after a week to ask about his or her criminal record would be totally acceptable.”

Initial, proposed iterations of the New Jersey Opportunity to Compete Act had alarmed some business advocacy groups and business owners, because the law might have required that employers refrain from inquiring about criminal histories until after they had extended conditional offers of employment. This might have created a morass of concerns and legalities for companies, but experts say the law in its final form is not especially onerous.

Paul T. Fader, partner at the law firm of Florio Perrucci Steinhardt & Fader, LLC, explains, “I don’t think [the law] is going to change things much for employers, and for the process they go through. Many employers are already sophisticated about what they can and cannot ask in an interview – related to potential discrimination, and otherwise. [This law] is just another layer added to their understanding of what the initial interview process should be like. However, whether or not it has an impact on the ability of an individual with a prior criminal history to get employed, and to some extent reduce the unemployment rate in New Jersey, is yet to be seen.”

Echoing some of these sentiments, Carla N. Dorsi, director of employment and labor law at the law firm of Gibbons, P.C., says, “I have not heard a lot of ‘push back’ from employers about the law, and I think that might be because Newark enacted a [related] ordinance a couple of years ago, as had Philadelphia. So, people were aware that the issue was out there. And then perhaps more importantly, in 2012, The United States Equal Opportunity Commission (EEOC) issued guidance not so much on when you are allowed to ask about criminal background, but how you are allowed to use that information. Most employers – certainly larger employers – were pretty well versed in the notion that you shouldn’t be categorically denying people employment on the basis of their criminal backgrounds, and this was an issue on their radar. [The New Jersey Opportunity to Compete Act] has not necessarily taken people by surprise, and it shouldn’t be the first time that they are hearing about the issue, in general. I think for some smaller employers, it is really just a matter of making sure their applications and job postings are in place [by March 1].”

Of note, local laws such as the aforementioned City of Newark’s expansive “ban the box” law that took effect in November 2012 – and similar laws in locales such as Jersey City and Atlantic City – are now preempted via The New Jersey Opportunity to Compete Act.

Peter L. Frattarelli, shareholder and chairperson of the labor and employment department at the law firm of Archer & Grenier, P.C., says, “I think by the time this law got passed, there were probably six to eight different ordinances out there, none of them identical. The one sentiment I have heard, from clients and also commentators, is at least now we have uniformity in New Jersey: We know what the rules are, and they apply everywhere. That’s good. Certainly, what I have heard from the employer side is: [The New Jersey Opportunity to Compete Act] is much better than those ordinances; it is much better than what we had seen proposed [statewide], originally. The fact that employers have the ability to ask about [criminal histories] down the road, I think helps our clients.”

Penalties

While the New Jersey Opportunity to Compete Act may be relatively easy to comply with, violators can face civil penalties ranging from $1,000 for the first violation, $5,000 for the second violation, and $10,000 for each subsequent violation. It is important to note, however, that the act does not permit a private cause of action filed by employees or applicants.

Beyond complying with the basic requirements, Stefanie Riehl, assistant vice president for employment and labor policy at The New Jersey Business & Industry Association (NJBIA), asks, “Can an employer face liability if they wait until after the first interview to ask about criminal history, but later decide not to hire an ex-offender? What I would say is that although the matter has not been litigated by the courts, the New Jersey Opportunity to Compete Act has very strong language that protects employers that decide not to hire an applicant with a criminal history. The act explicitly shields employers, ensuring that a violation of the act cannot be used to establish liability under that statute or any other statute. There’s very, very strong language in the act, and that is something that NJBIA – along with other groups such as the New Jersey Civil Justice Institute – fought for. We worked with groups like that to really try to get that language, such that the employers would not face additional liability under the law.”

Other Issues

Beyond the New Jersey Opportunity to Compete Act and the federal EEOC guidelines, employers must be especially cautious with background checks. Ogletree Deakins’ Diana says, “It is important for employers to remember that, if they are conducting background checks on applicants to get criminal history information, they must be careful to not only comply with this ‘ban the box’ law, but that they are also careful to comply with the state and federal Fair Credit Reporting Acts, which impose a number of restrictions on the use of background checks.

“Criminal history information usually comes to an employer one of two ways: They ask for it directly from an applicant, or they get it through a background check. If you ask for it directly from an applicant, you don’t have to worry about the Fair Credit Reporting Act (FRCA) issues. But, if you hire a background check company to get that information from an applicant, you do have to worry about it. And although many employers are aware that they have to comply with the FRCA, a lot of employers don’t do it correctly. It is a very demanding statute, in terms of having your ‘i’s’ dotted and your ‘t’s’ crossed. And if you slip up, even in what appears to be a completely innocuous way, you can face a lot of liability.”

While the FRCA is beyond the scope of this article, in broad terms, Gibbons’ Dorsi says, “There are a lot of technical requirements under the act, in terms of the notice you need to provide to employees or applicants, about your intent to conduct a background check, the consent you obtain from the applicant or employee, and what you then have to report to the third-party provider. Then, once you get the results of the background check from the third-party provider, it’s how you notify your applicants of your decision, and whether or not the information in the background check impacted your decision. There are a lot of moving pieces when you are dealing with these background checks. It is easy to fall victim to just a simple technical violation if you are not paying attention and following it, step by step.”

Conclusion

The United States has historically been a nation of “new beginnings” and opportunities, and the New Jersey Opportunity to Compete Act may merely be a new expression of the fabric weaved into this country at its very inception. That said, balancing the desire for persons to overcome past transgressions with the need for limiting burdens on employers and permitting them to select job applicants they can fully trust is a delicate dance.

 

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