The challenges of employment applications for multi-state employers

One of the hottest trends in employment in recent years has been the passage of “ban-the-box” and salary inquiry prohibitions in states and cities across the country.

Limitations on salary inquiry have popped up in recent years as part of the legislative fight against wage discrimination and the gender pay gap. Proponents of such prohibitions argue that salary history questions feed into the discrepancy between what male and female employees are paid by continuously repeating history.

Currently, California, Delaware, Massachusetts, Oregon and Puerto Rico have banned inquiries about prior salary, as have cities including New Orleans, New York and Philadelphia, with dozens of other states and local governments considering such measures.

The colloquial term “ban-the-box” refers to a box that applicants check to indicate they have a criminal record on standardized application forms. About 20 states and more than 150 local entities have already enacted legislation addressing inquiries into criminal history. The trend even went federal in 2015 with the Fair Chance Act introduced in Congress. Although the measure did not pass, it demonstrated the popularity of the movement.

The proposed federal legislation also shined a light on the situation facing multistate employers, with different laws in different states and in some situations, different laws in different cities or municipalities within the same state. One law may contain an outright ban on inquiries into salary or criminal history while another may place restrictions on the timing of the questions. Some laws define covered employers to include businesses with five or more employees; another may not apply its limitations to employers with less than 50 workers.

As an example, although the state already limited employers’ ability to ask job applicants about any juvenile court matters, the California legislature broadened its ban-the-box protections for employees with a new law in 2017. Employers in the state are restricted from making hiring decisions based on an applicant’s convictions records and forbidden from considering conviction history until a conditional offer of employment has been extended.

If an employer elects not to hire an applicant because of a prior conviction, the employer is required to conduct an individualized assessment to determine whether the history has a “direct and adverse relationship” with the job duties that justifies denial of the position. Written notice must be provided to an applicant that his/her conviction history has disqualified the applicant from employment, along with five days to respond and dispute the decision. A second notice must be provided with the final decision not to hire.

In contrast, Vermont’s ban-the-box measure takes a different approach, allowing employers to question applicants about their criminal records during the job interview, albeit providing an applicant with the opportunity to explain their record. And under New York City’s law, an employer commits a per se violation of the statute by using recruiting materials of any kind (including advertisements, solicitations or applications) that express, directly or indirectly, any limitation or specification regarding criminal history.

While the overarching principle remains consistent, the details of the laws vary from jurisdiction to jurisdiction. For multi-state employers, coping with such a patchwork of legal requirements poses a serious challenge.

As the number of state and local jurisdictions with laws addressing salary inquiries or criminal history continues to expand, multi-state employers should brace themselves for a giant compliance puzzle – and consider getting help from an expert.

The legalities of monitoring employees online

As a general principle, employers are legally permitted to monitor their employees online during business hours. Keeping a close eye on workers can help maintain company confidentiality, limit workers from surfing the web on company time, and ensure the prevention of harassment.

But such monitoring does come with caveats, as well as risks.

For example, screening employee email on the employer’s network may be permissible but may require advance notice. In states such as Connecticut and Delaware, laws are in place that require employers to provide prior notice before electronically monitoring employees. A union contract may also place certain limits on monitoring and public-sector employees may have some rights under the Fourth Amendment with regard to unreasonable search and seizure.

Federal law can also come into play. Although the Electronic Communications Privacy Act (ECPA) generally prohibits the monitoring of electronic communications, it contains a “business purpose exception” that permits employers to monitor the electronic communications of workers if the company has a “legitimate business purpose.” The statute also allows monitoring with consent and many companies do this by including such permission as part of the onboarding process for new employees before granting access to the company’s networks or systems.

Another wrinkle: third-party communications. States such as California and Illinois mandate that all parties to a communication provide consent to its interception in transit. For employers, that means providing notice to recipients of employee emails and obtaining their consent before scanning a message from a friend or third party. Many companies post a notice on the company’s website and/or include a statement in employee emails that all messages are subject to monitoring and any response implies consent with the employer’s practices.

Even with all these issues, monitoring emails may be more straightforward than focusing on employee social media accounts. The Stored Communications Act (SCA) addresses the situation of accessing electronic communications stored by a provider (such as Gmail or Microsoft), as distinct from an employer accessing emails on its own system. Under the SCA, employers can be liable for the unauthorized access and disclosure of electronic communications in storage on corporate servers of a provider.

Further, roughly half the states ban employers from either requiring or requesting a worker to verify a personal online account like a Facebook profile, blog or Instagram or to log on to their social media account. While technology is available for employers to get around these laws (using keystroke logging software, for example, or taking screenshots), some of the information being monitored by an employer could itself be protected – such as union organizing activities under the National Labor Relations Act, attorney-client communications or in some states, geolocation data.

Mobile devices add another layer to the analysis. For workers using employer-provided mobile phones or devices, the employer has the right to legally monitor use from contact lists to photos and videos to Internet visits and emails. As for bring-your-own-device (BYOD) situations, the terms are generally dictated by the employer’s BYOD policy, but this is an emerging area of law and therefore murky.

All of these legal considerations are centered in the United States. Companies that operate outside the U.S. borders will have international law to contend with as well, notably the European Union General Data Protection Regulation (GDPR) and regulations found in its member states. As a general matter, EU law and the GDPR offer employees a greater level of privacy than that found in the United States. Last year, the EU’s highest court did rule that companies can monitor employee email – if workers are notified in advance.

Perhaps most importantly, employers should recognize that like all things related to technology, the legalities of monitoring employees online are constantly evolving. Being able to adapt to changing laws, regulation and technology will keep employers on their toes.

Update on Employment Background Screening Legislation

This post was originally posted on Scherzer.com

“BAN-THE-BOX”

List of jurisdictions is growing

“Ban-the-box” measures, which generally prohibit employers from inquiring about a candidate’s criminal history (including performing background checks) until later in the hiring process, and impose significant compliance requirements, will soon be the norm rather than an exception. The list of localities that have enacted such legislation is growing fast and now includes Austin, Baltimore, Buffalo, Chicago, Columbia – MO, Los Angeles (enforcement started July 1, 2017), Montgomery County – MD, New York City, Philadelphia, Portland, Prince George’s County – MD, Rochester, San Francisco, and Seattle, and ten states (Connecticut, District of Columbia, Hawaii, Illinois, Massachusetts, Minnesota, New Jersey, Oregon, Rhode Island, and Vermont (effective July 1, 2017)).

Although not labeled as “ban-the-box,” California’s Department of Fair Employment and Housing regulations (the “Regs”) that went into effect July 1, 2017, impose certain similar requirements when employers consider criminal history information in employment decisions. As reported in our previous blog, the Regs are substantially based on the enforcement guidance issued by the Equal Employment Opportunity Commission in April 2012, and prohibit employers from using a candidate’s criminal history in personnel decisions if such information will have an adverse impact on individuals that are in a legally protected class.

Amended rules for New York City’s “ban-the-box” took effect August 5, 2017

Nearly two years after the enactment of New York City’s Fair Chance Act (FCA), and without much fanfare, the City’s Commission on Human Rights published its amended rules that  establish certain definitions and procedures, and clarify the comprehensive requirements of the FCA when using criminal history in employment decisions, and considering applicants for licenses, registrations, and permits.

CREDIT CHECK RESTRICTIONS

Eleven states (California – AB 22; Colorado – The Employment Opportunity Act; Connecticut  – SB 361; District of Columbia – Fair Credit in Employment Amendment Act, Hawaii – HB 31 SD1; Illinois  – HB 4658; Maryland- HB 87;  Nevada – SB 127; Oregon – SB 1045; Vermont – Act No. 154 (S. 95); Washington – RCW 19.182 and  RCW 19.182.020) and at least two localities  (New York City – Stop Credit Discrimination in Employment Act, and Philadelphia – Bill No. 160072), have enacted laws that generally prohibit private employers from checking a candidate’s credit history, except in circumstances where a credit screen is justified by the position’s responsibilities or is required by law.

WAGE HISTORY INQUIRIES

Pay equity initiatives, which among their provisions include a ban on inquiries about a candidate’s wages, are gaining momentum nationwide. The following jurisdictions have enacted such laws and many more are considering similar measures: Delaware – HS1 (effective December 14, 2017); Massachusetts – Pay Equity Act (effective July 1, 2018); New York City – Intro 1253 (effective October 31, 2017); Oregon HB 2005 (effective December 1, 2019); Philadelphia – Fair Practices Ordinance: Protections Against Unlawful Discrimination (set to go into effect May 23, 2017 but now facing a legal challenge); Puerto Rico – Equal Pay Act (effective March 8, 2017); and San Francisco – Parity in Pay Ordinance (effective July 1, 2018).

Pending before California’s Senate is AB 168 that would prohibit employers from seeking an applicant’s salary history and impose significant penalties for violations. Notably, California already has a pay equity law, AB 1676, and although the law does not ban salary history inquiries, it does prohibit employers from using a candidate’s prior wages as the sole basis to justify a pay disparity.

WORK AUTHORIZATION VERIFICATIONS

Revised Form I-9

The USCIS released a revised version of Form I-9, Employment Eligibility Verification on July 17, 2017. Employers can use this revised version or continue using Form I-9 with a revision date of “11/14/16 N” through September 17, 2017. Beginning September 18, 2017, however, employers must use the new form (with the revision date of “07/17/17 N”).

Reminder to California employers

California’s  AB 1065 that went into effect January 1, 2017, makes it unlawful for employers to:

  1. request additional or different documents than those required under federal law to verify that an individual is not an unauthorized immigrant;
  2. refuse to accept documents provided by the applicant that reasonably appear to be genuine;
  3. refuse to honor documents or work authorization based on specific status or term that accompanies the authorization to work; and
  4. attempt to re-investigate or re-verify a candidate’s authorization to work using an unfair immigration-related practice.