Amendments to Philadelphia’s “Ban the Box” legislation, the Fair Criminal Records Screening Standards, will go into effect on March 14, 2016. The amendments expand the reach of existing law to more businesses. They also restrict the look-back period for background checks and reliance on criminal records as a basis for rejecting applicants for employment, imposing new obligations and legal risk on employers doing business in Philadelphia.

Original Ordinance

The ordinance, at Chapter 9-3501 et seq. of the Philadelphia Code, originally took effect in 2012 and applied only to employers with at least 10 employees in Philadelphia. Employers could conduct criminal background checks after the first interview, which included phone interviews, and could search as far back into an applicant’s history as desired. While the original ordinance provided for an administrative fine against a violating employer, it did not provide for a private cause of action, as does the amended ordinance.

2015 Amendments

Now, under the recent amendments, any employer with at least one (1) employee in the City is covered by the law. Further, the amendments impose a new posting requirement.

In addition, when conducting background checks, employers can look back only seven years, although any intervening period of incarceration cannot be included in the calculation of this seven-year period.

Further, under the amended ordinance, criminal background checks may be conducted only where a “conditional offer of employment” has been extended to the candidate. A conditional offer of employment may be withdrawn based upon a conviction record only where the employer subsequently determines that the applicant:

1. has a conviction record that would “reasonably lead an employer to conclude that the applicant would pose an unacceptable risk in the position applied for,” or

2. failed to meet legal or physical requirements of the job.

The amendments include a prohibition on policies under which a criminal conviction would act as an automatic bar to employment. Instead, employers will have to consider certain factors in determining whether a criminal background presents an unacceptable risk, including:

• The nature of the offense;

• The time that has passed since the offense;

• The applicant’s employment history before and after the offense and any period of incarceration;

• The particular duties of the job being sought;

• Any character or employment references provided by the applicant; and

• Any evidence of the applicant’s rehabilitation since the conviction.

Furthermore, an employer may reject an applicant based only on a criminal record where the record includes a conviction for an offense that bears a “relationship to the employment sought” such that an unacceptable risk is present and “exclusion of the applicant is compelled by business necessity.” A similar requirement is already imposed by Pennsylvania state law (18 Pa. C.S. §9125). Under state law, employers must determine whether convictions “relate to the applicant’s suitability for employment in the position” for which he or she applied. The individualized assessment required by the amendments adds to the protections already offered by the state law and sought by the federal Equal Employment Opportunity Commission in its Consideration of Arrest and Criminal Conviction Enforcement Guidance.

The amended ordinance includes a notice requirement, under which an employer deciding to disqualify an applicant because of a conviction must inform the applicant in writing of this decision. An employer must provide the applicant with the background check that formed the basis of the decision. The applicant then has 10 days to offer proof that the background check is inaccurate or provide an explanation. This process must be coordinated with any requirements under fair credit reporting act laws if the employer is using a third party vendor to conduct background checks.

Lastly, enforcement mechanisms also have been overhauled by the amendments, which now will be administered by the Philadelphia Commission on Human Relations (“PCHR”). In addition to the administrative fine previously imposed, a private right of action will be available to individuals who believe they have been discriminated against in violation of the ordinance. Such individuals will have 300 days to report a violation to the PCHR.

The PCHR is granted the authority to order various remedies, including, but not limited to:

1. issuance of a cease and desist order;

2. injunctive or other equitable relief;

3. compensatory damages;

4. punitive damages, subject to a $2,000 cap per violation; and

5. payment of attorneys’ fees.

However, if after one year, the PCHR concludes that there is insufficient evidence to find a violation of the ordinance or an agreement has not yet been reached, the PCHR must notify the complainant that the case is dismissed. The complainant has two years from receipt of this notice of dismissal to file an action in court.

Implications for Philadelphia Employers

Employers in Philadelphia will have to comply with the host of new obligations associated with the application and background check process. Employers should not make any criminal background inquiry during the interview process, including on their application form. If an applicant voluntarily discloses a criminal record during the interview process, an employer is permitted in this instance to inquire further about the criminal record. Criminal background checks should not be performed until a conditional offer of employment has been extended. Moreover, where an applicant will be disqualified because of a conviction, employers should document their individualized assessment of the required factors and comply with the notice provision. Employers should review their existing procedures pertaining to background checks and make revisions where necessary.