California Employment Screening: 2025 Laws and Best Practices
In 2025, California’s employment screening rules, especially around background checks, remain tightly regulated.
This article breaks down the key laws and best practices for employers to stay compliant and hire confidently.
Summary of this article
- Federal and State Compliance: California employers must comply with the federal Fair Credit Reporting Act (FCRA), Equal Employment Opportunity Commission (EEOC) guidelines, and California-specific laws, including the Investigative Consumer Reporting Agencies Act (ICRAA) and the California Consumer Credit Reporting Agencies Act (CCRAA).
- Ban-the-Box Law: Since January 1, 2018, under California Government Code § 12952, employers with five or more employees cannot inquire about criminal convictions before making a conditional job offer. Post-offer, criminal history checks are permitted only if the conviction has a direct and adverse relationship to the job duties.
- Disclosure and Authorization:
- Employers must provide a clear, standalone written disclosure to applicants/employees stating a background check may be conducted.
- Written authorization from the applicant/employee is required before conducting the check, separate from the employment application.
- If using a Consumer Reporting Agency (CRA), employers must certify compliance with FCRA, including obtaining permission and ensuring non-discriminatory use of information.
- Adverse Action Process:
- Before taking adverse action (e.g., not hiring or terminating based on the background check), employers must provide a pre-adverse action notice with a copy of the report and a summary of FCRA rights.
- After the adverse action, a final notice must inform the applicant/employee of the decision, the CRA’s contact information, and their right to dispute inaccuracies.
- Reporting Restrictions:
- Under ICRAA, CRAs cannot report non-conviction records (e.g., arrests without convictions) or convictions older than seven years, except for positions with salaries of $75,000 or more.
- Bankruptcy information can be reported for up to 10 years, but other adverse information (e.g., civil judgments, tax liens) is limited to seven years.
- Public Records:
- If employers conduct their own checks and access public records (e.g., arrests, convictions, civil actions), they must provide a copy to the applicant/employee within seven days unless the right is waived.
- Even if waived, a copy must be provided if an adverse action is taken based on the records.
- Local Ordinances:
- Cities like Los Angeles and San Francisco have stricter “ban-the-box” ordinances, applying to employers with 10 or more employees (Los Angeles) and affecting temporary or contract workers as well.
- EEOC Considerations:
- Employers must assess criminal history individually, considering the offense’s nature, its relevance to the job, and the time elapsed since the conviction, to avoid discriminatory practices under Title VII of the Civil Rights Act.
- Legal Counsel Recommended: Due to the complexity and frequent updates to these laws, employers are advised to consult legal counsel to ensure compliance and minimize litigation risks.
Why Compliance Matters
Following California’s employment screening laws isn’t just about avoiding lawsuits. It builds trust with candidates and boosts your company’s reputation.
Noncompliance can lead to hefty fines, legal battles, or reputational damage.
For instance, violating the Fair Chance Act can result in damages like back pay, emotional distress, or even punitive damages.
Key 2025 Employment Screening Laws in California
California’s Fair Chance Act leads the pack. It’s often called the “Ban the Box” law. Employers with five or more employees can’t ask about criminal history until after a conditional job offer. This gives applicants a fair shot to showcase their skills first. Once an offer is made, employers can run a criminal background check. But there’s a catch: the conviction must relate directly to the job’s duties to justify rejecting an applicant.
The Investigative Consumer Reporting Agencies Act (ICRAA)
In California there is a more restrictive law called Investigative Consumer Reporting Agency Act (ICRAA). Under the ICRAA a consumer is given greater protections than the FCRA.
It limits how far back checks can go among other laws. Employers can’t see convictions older than seven years. Non-conviction records, like arrests without charges, are off-limits too. This ensures outdated or irrelevant information doesn’t block job opportunities.
The Fair Credit Reporting Act (FCRA) applies too
Before running a background check, employers must get written consent from the candidate. They must also provide a clear disclosure that a check will be conducted. If the check leads to a rejection, employers must send a pre-adverse action notice, including a copy of the report, and give the applicant five business days to respond.
Local laws
Like those in Los Angeles, add more rules. For example, employers must provide a written assessment linking a candidate’s criminal history to job duties if they plan to rescind an offer.
The Fair Chance Ordinance for Employers went into effect September 3, 2024. Los Angeles County Requires Workplace Posting.
The Ordinance prohibits covered employers from preventing or discouraging applicants or employees with a criminal history from applying for or responding to job solicitations, postings, announcements, and advertisements.
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Best Practices for California Background Checks
- Stay Consistent. Apply the same screening process to all candidates for the same role. This avoids claims of bias or discrimination. A uniform approach also simplifies compliance.
- Get Consent First. Always obtain written permission before starting a background check. Make sure the disclosure is clear and separate from other forms. This meets both FCRA and California’s requirements.
- Follow the Fair Chance Act. After a conditional offer, evaluate criminal history carefully. Consider the nature of the crime, how long ago it occurred, and its relevance to the job. Document your reasoning to show compliance.
- Keep It Confidential. Share background check results only with those who need to know. This protects candidate privacy and reduces legal risks.
- Train Your Team. Educate HR staff and hiring managers on California’s screening laws. Regular training ensures everyone knows the rules and follows them.
Industry-Specific Screening Needs
Different industries have unique requirements. For example, healthcare employers like Kaiser Permanente need thorough checks to protect patients. Tech companies, such as Google, often verify credentials and screen for cybersecurity risks. Financial firms, like Wells Fargo, focus on preventing fraud through detailed screenings. Tailor your checks to meet industry standards while staying compliant.
What are the key changes in California's employment screening laws for 2025?
In 2025, California has introduced stricter regulations on the use of criminal records in employment decisions, emphasizing the importance of individualized assessments and the prohibition of blanket policies.
How does the Fair Chance Act affect hiring processes?
The Fair Chance Act requires employers to delay background checks until after a conditional job offer is made, ensuring that candidates are evaluated based on their qualifications first.
Are there restrictions on the types of background checks employers can conduct?
Yes, employers must ensure that their background checks comply with state laws, focusing only on relevant information and avoiding inquiries into sealed or expunged records.
What is the role of consent in employment screening?
Employers must obtain explicit written consent from candidates before conducting any background checks, and they must provide a clear disclosure of the screening process.
How should employers handle adverse action based on background checks?
If an adverse action is considered, employers must provide a pre-adverse action notice, a copy of the report, and a summary of rights under the FCRA to the candidate.
What are the penalties for non-compliance with California's screening laws?
Non-compliance can lead to significant fines, legal action, and damage to the company’s reputation, emphasizing the need for strict adherence to the laws.
Can employers use social media in their screening process?
While social media can be used, employers must ensure that their searches do not violate privacy rights and should focus on professional information relevant to the job.
How often should employers update their screening policies?
Employers should review and update their screening policies annually to ensure compliance with the latest state and federal regulations.
What resources are available for understanding these laws?
Employers can access resources from the California Department of Fair Employment and Housing and consult with legal experts to stay informed about changes in the law.
Final Tips for Employers
Review your screening policies regularly. Laws change fast, and staying updated is critical. Work with legal counsel to ensure your practices align with federal, state, and local rules. By prioritizing fairness and transparency, you’ll create a hiring process that’s both effective and legally sound.
By following these guidelines, California employers can navigate the complex world of employment screening with confidence in 2025. Stay compliant, hire smart, and build a stronger workforce!
References
Fair Credit Reporting Act (FCRA)
Fair Chance to Compete for Jobs Act
Title VII of the Civil Rights Act of 1964
California Fair Chance Act
Investigative Consumer Reporting Agencies Act (ICRAA)
California Labor Code § 432.7
California Information Privacy Act (CIPA)
Consumer Credit Reporting Agencies Act (CCRAA)
California Clean Slate Act
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