On March 1, the Opportunity to Compete Act, also known as ‘Ban-the-Box’ went into effect. Under the new law, employers are prohibited from asking about an applicant’s criminal history on their employment applications, or from making any such inquiries or investigations until the conclusion of the “initial employment application process.”
As other states look to pass similar legislation, they should look to New Jersey’s law as a model of legislation that “bans the box” without raising liability concerns. The law includes NJCJI-drafted liability language that ensures that a violation of the act cannot be used to establish liability under this statute or any other statute.
“Well-intentioned regulation often clashes with New Jersey’s broader legal landscape in a way that threatens to greatly increase New Jersey employers’ liability risk,” said NJCJI’s president Marcus Rayner. “We are very pleased language limiting litigation was included in the law. Not only does it significantly improve this particular legislation, we hope it will be a model for legislators seeking to regulate a particular practice without unnecessarily creating or expanding liability.”
What is in the law?
The law prohibits employers from asking about an applicant’s criminal history on their employment applications, or from making any such inquiries or investigations until the conclusion of the “initial employment application process.” That process is defined as concluding “after a first interview, whether in person or by any other means.” The full scope of the “first interview” will be refined over time, but a telephone interview would presumably qualify.
The law does not regulate the timing of criminal background checks for positions where a state or federal law or regulation either requires a criminal background check for the position in question, or would limit an employer’s ability to engage in specified business as a result of a criminal record of its employees. It also does not regulate the timing for positions in law enforcement, or other public security-related employment. Employers are free to place the inquiry on the application, and can conduct criminal background checks and ask applicants about their criminal histories when hiring for these carved-out positions at any time in the hiring process.
Scope of Inquiry:
Employers retain complete discretion over what convictions or arrests are considered in the application process under the law.
Preemption of Local/Municipal/County Ordinances:
All local ordinances that relate to criminal histories in the employment context are preempted by the new law, including the very aggressive ordinance Newark has adopted.
Individualized Assessment:
There is no requirement under the law that an employer conduct an individualized assessment of an applicant’s criminal history.
Advertising:
The sole advertising restriction in the law is a prohibition on advertising that “explicitly provides that the employer will not consider any applicant who has been arrested or convicted off one or more crimes or offenses.” This prohibition does not apply to employers hiring for carved-out positions (state or federal law requiring background checks or limiting business activities based on criminal records; law enforcement, judiciary, etc.).
This Does Not Impact Federal Law
Please note: state law is not the only regulation of an employer’s use of criminal histories in the hiring process. The EEOC has issued updated Guidance that seeks to regulate the use of criminal records due to its potential disparate impact based on race. Though the agency has not met with much success in federal court thus far, employers wishing to avoid risking enforcement actions would be advised to review those guidelines.
Implementation & Enforcement
The law went into effect on March 1. From now on, employers with 15 or more employees must be in compliance. Violations of the act are punishable by civil penalties of up to $1,000 for a first violation, $5,000 for a second violation, and $10,000 for each subsequent violation.
Please contact a member of the NJCJI team if you have questions or comments about this law.
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