NYC Background Checks: 10 Background Check Rules That Every NYC Employer Should Know

If you’re a New York City employer who thinks hiring has become a lot more complicated, you’re right. Laws that have come on the books related to background checks make it incumbent upon the employer to safeguard the rights of job applicants.

Is there a place where hiring is as complicated as it is in New York City? Probably not. The city has sheer size and numbers that make it so, and an economy that’s bigger than what many countries can boast, plus a litany of laws that protect the rights of job applicants. 

Global Backgrounds understands the details of New York City background checks and how to conduct effective checks within the labyrinth of relevant laws.

Let’s go over 10 background search requirements that your company — and your human resources department — should know. 

1. New York City Two-Stage Background Search

The NYC Fair Chance Act is part of the New York City Human Rights Law. The New York City Commission on Human Rights says the law “protects workers against arbitrary denials of employment opportunities based on criminal history and ensures that job applicants are considered based on their qualifications before their criminal history.” 

As of July 29, 2021, amendments to the NYC Fair Chance Act require that  pre-employment background searches be done in two stages: 

Stage 1: Non-criminal. All non-criminal searches must be completed before a criminal background check may be done, and before a conditional job offer may be made. 

This includes such background checks as employment history, education verification and reference checks. So, if an employer wants to talk to fellow employees or former employers, that must be done before the criminal check.

At this point in the hiring and interview process, it’s unlawful in New York City to ask about criminal background; to say that a criminal background check will or might be done; or even to say that the employer conducts its hiring within rules regarding criminal checks. These statements may not be made orally or in writing on hiring forms.

It’s also illegal to ask about or check a job candidate’s driving record, since driving violations could show in crime-related background checks, which are barred in Phase 1.

Stage 2: Criminal and Driving. Criminal background checks may be done only after all other checks are completed, and after a conditional job offer is made. Driving records now may be checked.

Under the act, non-convictions are completely protected: Employers may not use against a candidate prosecutions that resulted in verdicts of not guilty, or mere arrests or charges. Some pending prosecutions may be considered in hiring decisions, but only within limits set forth in the FCA.

Employers in New York City, when using professional third-party background check specialists, such as Global Backgrounds, should request findings from criminal checks and driving record checks apart from other background check data.

When criminal data is not separated from other background findings, those who actually make hiring decisions for the employer must consider the criminal data separately from all other information.

2. Limitations on Revocation of Conditional Offers 

The amended FCA also defines the limited circumstances under which an NYC employer may revoke a conditional offer. 

An employer withdrawing a conditional offer must base the decision on one or more of three factors:

  • Criminal activity discovered within legally conducted criminal background checks.

  • A medical examination that conforms to the Americans with Disabilities Act and uncovers data that would prevent candidates from performing the job for which they applied.

  • Information that comes to light after the offer is made and could not have been discovered through searches that are allowed before an offer is extended.

3. Youthful Offender Protections

Crimes committed by a job candidate when he was 25 years old or younger are not considered lawful grounds for withdrawing a job offer in New York City.

5. Petty Offense Protections

Minor infractions — disorderly conduct, loitering and trespassing are examples — may not be used as grounds for taking adverse action after a discovery during background checks. Even if asked, after a criminal check, if a candidate has had criminal judgments against him, the applicant is allowed to answer “no” if the violation is a minor offense. The candidate also may answer “no” if the conviction was sealed, expunged, or reversed on appeal. 

6. Limitations on Credit Checks in Hiring

New York City’s Stop Credit Discrimination in Employment Act considers the unnecessary use of credit reports in hiring decisions to be discriminatory. In its guidance on the law, the NYC Commission on Human Rights says that “consumer credit history is rarely relevant to employment decisions, and consumer reports should not be requested for individuals seeking most positions in New York City.”

Exceptions include positions in the financial industry; some investigative police positions; jobs that require bonding; certain positions in public agencies, such as commissioners and counsel; jobs with security clearance; and jobs where holders would have access to trade secrets.

7. Applicant’s Right To Respond to Adverse Action

If an employer takes adverse action — withdrawing a job offer, firing an employee or denying a promotion — based on a credit or other report, subjects must receive the information and written information explaining their opportunity to respond.  

Under both the FCRA and the city’s Fair Chance Act, a job candidate or employee must get  a copy of the findings, an explanation of the adverse action, instructions on how to respond, and a reasonable period — at least five business days in NYC — to do so.

8. NYC’s “Floor” of Protection

Where federal and state protections for job applicants differ from those set by NYC, the city’s Human Rights Law makes it clear that it takes precedence where it goes further than they do to protect applicants. 

The city’s Human Rights Act states that “similarly worded provisions of federal and state civil rights laws [are] a floor below which the City’s Human Rights law cannot fall, rather than a ceiling above which the local law cannot rise.” 

In other words, the city’s laws are designed to expand, rather than reduce, worker and job applicant protections.

9. Seven-Year Rules: Federal Fair Credit Reporting Act vs. New York State 

New York State’s seven-year rule differs somewhat from the seven-year rule in the FCRA. 

The FCRA, in force since 1970 and revised from time to time, bars credit checks for loan and employment screening to look back more than seven years at crimes and personal financial data. Under the city’s FCA, background checks may not disclose to employers arrests that are more than seven years old if the arrests resulted in non-convictions. Other information barred from background checks under the FCRA include court-ordered liens, collections, bankruptcies and civil cases that are more than seven years old. The rules do not apply to applicants for jobs that pay more than $75,000 per year.

The New York State general business law bars reporting crimes more than seven years old; any arrests that do not result in convictions unless prosecution is pending; addiction records more than seven years old; and court judgments that have been satisfied and are five or more years old. The limitations do not apply to job applicants who would be paid more than $25,000 per year.

10. EEOC on How Criminal Information is Evaluated

An important element in Equal Employment Opportunity Commission regulations is how employers evaluate the criminal information they have. 

The EEOC, under Title VII of the Civil Rights Act, says that before taking adverse action, such as rejecting an applicant, those who are hiring should judge whether any crime uncovered during background investigations would impact the applicant’s ability to perform a specific job. So, for example, a drunken driving conviction would play more seriously for a truck driver applicant than for a prospective office clerk who would not drive on the job.

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