Passed in March 2016 and effective April 4, 2016, Austin's new "Fair Chance Hiring" Ordinance implements new rules related to employer inquiries about an applicant's criminal history.
Here's what employers should know about the new law:
Does the law apply to every employer? No, it applies to an employer (including a labor organization) that employs at least fifteen (15) individuals whose primary work location is in the City of Austin for each working day in each of twenty (20) or more calendar weeks in the current or preceding year. The term "employer" excludes the United States; a corporation wholly owned by the United States; a bona fide private membership club exempt from taxation under Section 501(c) of the Internal Revenue Code; the state or a state agency; and a political subdivision of the state.
What does the law prohibit? Employers cannot:
- publish or cause to be published information about a job covered by the new law that states or implies that an individual's criminal history automatically disqualifies the individual for consideration;
- solicit or otherwise inquire about an individual's criminal history in an application for a job covered by the new law;
- solicit criminal history information about an individual, or consider the individual's criminal history unless the employer has first made a conditional offer of employment to that person;
- refuse to consider an individual in a job covered by the law because the individual did not provide criminal background information before he or she received the conditional offer of employment;
- take adverse action (refuse to hire, refuse to promote, or revoke an offer of employment or promotion) against an individual unless the employer has determined the individual is unsuitable for the job based on an individualized assessment conducted by the employer; and
- take an adverse action against an individual because he or she has reported a violation of the law or participated in an administrative proceeding.
What does the law require? Employers must conduct an individualized assessment of a criminal background record after a conditional offer of employment is made. Nothing in the law limits an employer's authority to withdraw a conditional offer of employment for any lawful reason, including the determination that an individual is unsuitable for the job based on the results of the individualized assessment.
What is an individualized assessment? An individualized assessment is an evaluation of the criminal history of an individual that includes, at a minimum, the following factors:
- the nature and gravity of any offenses in the individual's criminal history;
- the length of time since the offense and the completion of the sentence; and
- the nature and duties of the job for which the individual has applied.
Are there any exceptions related to staffing agencies? Yes, the law provides that a staffing agency may solicit criminal history information about an individual and make an individualized assessment when the staffing agency has identified a job to which the individual will be employed or placed in a staffing pool.
Can an employee sue for a violation? No, there is no private cause of action.
How is the new law enforced? The Equal Employment/Fair Housing Office has the authority to receive and investigate complaints, as well as issue subpoenas.
Can an employer be subjected to penalties for violations? Yes. Employers will be given ten (10) days to correct any violation after receiving a written notice of a violation. If the violation continues, the City can impose a penalty of up to $500. The City may, for a first-time violator, issue a warning if the employer attends an appropriate training session about compliance.
Employers that use a standardized application form throughout the State of Texas, and have employees in the City of Austin, should review the form to ensure it complies with the law. They should also review their job postings and train hiring managers on permissible and impermissible inquiries and actions, with a particular emphasis on best practices for performing individualized assessments.