California Background Check: A Complete Guide [2024] (2024)

Background checks are an essential part of the hiring process. However, the rules surrounding them can be hard to understand.

This is especially true for pre-employment background checks in California, which require special considerations.

Did you know that one in three Californians has a criminal history?

This means employers are virtually guaranteed to encounter previous convictions, arrests, and other considerations at some point in their hiring efforts.

To help you navigate employment background checks, we’ve compiled this comprehensive guide, which covers the legislation, requirements, and procedures you need to know about.

Let’s get started.

What Does a California Background Check Show?

Employers in California can ask for pre-employment background checks from iprospectcheck that include the customized information they need.

However, most employers ask for several common types of information about the backgrounds of their prospective employees, including information about any criminal histories, prior employment records, educational records, and credentials.

Depending on the nature of the position, other types of information might also be requested.

1. Criminal Records

If one of your job applicants has a criminal record, you might see the following types of information on a pre-employment background check in California:

• Criminal charge or charges
• Date of filing
• Disposition of the case
• Disposition date
• Offense level
• Sentencing information

2. Employment verification

One of the most important things you can request on a pre-employment background check is employment verification.

Verifying your applicants’ claims about their employment histories can help you ensure that you hire trustworthy employees and prevent potential negligent hiring claims.

It also helps you determine whether they might have embellished their levels of experience or have made false claims.

When you request employment verification, the background check will show you the dates that a candidate worked at each job and any positions that he or she held.

3. Education verification

If the position for which you are hiring requires a certificate, degree, or another educational qualification, verifying the educational records of your candidates can be critical.

Some candidates may claim to have degrees that they have not completed. Others sometimes purchase degrees online from vendors that do not require them to take any classes.

Through education verification, you can verify the institutions your candidates attended, the dates, and any degrees or certificates they earned.

4. Credentials verification

If your open position requires that your candidates possess specific professional credentials or licenses, a California pre-employment background check can include verification of their credentials.

Requesting this type of verification can help you to ensure that your employees have the requisite qualifications for their jobs and help your company to avoid negligent hiring claims.

Important Laws and Regulations for 2024

Here’s a breakdown of the state’s various background check regulations, as they pertain to California employers:

The Fair Credit Reporting Act

The Fair Credit Reporting Act, or FCRA, exists to protect employers and applicants. Specifically, the FCRA promotes accuracy, fairness, and privacy for the information contained in consumer reporting agency files.

The FCRA is the national standard for employment background checks. For applicants, it guarantees the right to obtain a copy of the background check.

It also allows the applicant to file a dispute if the background check contains inaccurate or incomplete information.

California employers, like all employers, are required to follow FCRA guidelines. Today, federal FCRA guidelines apply when a hiring company uses background checks prepared by third-party providers.

In these cases, the employer must do the following:

• Provide the applicant with written notice that a background check and report may be required.
• Obtain the applicant’s permission to conduct a background check via an authorization form.
• Obtain specific permission if the job requires the collection of medical information.
• Provide notice if the employer intends to use the applicant’s neighbors, friends, or associates as character references, or if the employer will interview these people about the applicant’s “character, general reputation, personal characteristics, or mode of living.” The FCRA calls this process an “investigative consumer report.”
• Notify the applicant if the information contained in a background check is used to make an adverse hiring decision.

If an employer compiles a background check report on its own, FCRA provisions do not apply.

ICRAA/CCRAA

According to a 2018 California Supreme Court ruling known as Connor v. First Student, Inc., both the Investigative Consumer Reporting Agencies Act (ICRAA) and the Consumer Credit Reporting Agencies Act (CCRAA) now apply to certain employer background checks.

Because of this, employers may need to comply with both laws, in addition to ensuring their background checks remain compliant with all applicable federal and state laws.

Here’s what you need to know about the ICRAA and the CCRAA.

The ICRAA

The ICRAA (Investigative Consumer Reporting Agencies Act) has specific notification requirements, reporting restrictions, and more.

The ICRAA contains several clauses that are stricter than the FCRA. The ICRAA supersedes the FCRA in any provision where its laws are more restrictive.

Section 1786.18 of the ICRAA, for example, only allows for the reporting of criminal convictions and open cases. The ICRAA also establishes restrictions about when and how employers can generate background check reports.

According to Section 1786.16 (2)(B)(iv):

Any person described in subdivision (d) of Section 1786.12 shall not procure or cause to be prepared an investigative consumer report unless the following applicable conditions are met:

(2) If at any time, an investigative consumer report is sought for employment purposes other than suspicion of wrongdoing or misconduct by the subject of the investigation, the person seeking the investigative consumer report may procure the report, or cause the report to be made, only if all of the following apply:

(B) The person procuring or causing the report to be made provides a clear and conspicuous disclosure in writing to the consumer at any time before the report is procured or caused to be made in a document that consists solely of the disclosure, that:

(iv) Identifies the name, address, and telephone number of the investigative consumer reporting agency conducting the investigation.

Additionally, ICRAA requires adherence to the 7-year rule. It “limits the conviction information to seven years from the date of disposition, release, or parole…regardless of the subject’s anticipated salary.”

This is important since more general 7-year limitations under FCRA only apply to employees who make less than $75,000.00 annually.

The ICRAA goes on to clarify (in Section 1786.29) that investigative consumer reporting agencies must provide a series of notices on the first page of the investigative consumer reports they generate.

Notably, the section requires reporting agencies to include a notification (in 12-point boldface type) that the report does not guarantee the accuracy or truthfulness of its information.

It also requires the notice to disclose that the information within the report comes from the public record, and that identity theft and criminal activity may alter the accuracy of the results.

The ICRAA lays out additional requirements for investigative consumer reporting agencies in Section 1786.22, which compliance-minded employers should read in full.

California’s Seven-Year Lookback Rule

California includes a seven-year restriction on the reporting of convictions within the ICRAA. This law is found at Cal. Civ. Code 1786.18(a)(7).

By contrast, the federal Fair Credit Reporting Act (FCRA) doesn’t place a time limitation on the reporting of conviction records.

The ICRAA’s additional restriction as compared to the FCRA supersedes the FCRA, which means that convictions older than seven years can’t be reported on background checks.

Another difference is that this provision prohibits CRAs from reporting non-conviction information, including arrests and indictments, even if they occurred within the last seven years when they didn’t lead to convictions.

Pending cases can be reported.

California’s restriction applies regardless of the intended salary. By contrast, the FCRA’s seven-year limitation only applies to jobs paying $75,000 or more.

Finally, the application of the seven-year rule might be impacted by California’s expungement and clean slate laws as detailed below.

CCRAA

The CCRAA follows alongside ICRAA in most ways but deviates concerning credit reports. According to CCRAA Section 1785.20.5, credit reports and investigative consumer reports are considered background reports.

This section states the following:

“The report to the user and to the subject of the report shall be provided contemporaneously and at no charge to the subject person.”

CIPA

The California Information Privacy Act, or CIPA, (Cal. Civil Code §§ 1785 et seq.) takes the minimum employee privacy protections set forth by the FCRA and expands on them.

Like FCRA, CIPA establishes strict requirements for employers who hire third-party companies to conduct their background checks, as opposed to employers who choose to do it themselves.

For employers who DIY their investigations, CIPA requires the employer to give applicants the option to “opt-in” to receive a copy of their background check reports.

The checkbox must be located either in the job application or in the written notice of the background check, which is required by FCRA. If the applicant does opt-in, he or she must receive a copy of the report within three days of when the employer receives them.

If the employer chooses to hire a third-party agency to conduct background checks, CIPA requires the employer to issue what it calls a “clear and conspicuous” notice.

This notice must be in writing and must cover the “nature and scope” of the background check [Cal. Civil Code § 1786.16(2)(B)(v)].

If the employer’s third-party background check company also intends to interview the applicant’s references, the employer must:

1. State the purpose of the investigation.
2. Give the applicant contact information for the investigation agency.
3. Give the applicant a summary of their rights to see and copy any reports about them.
4. Provide the applicant with a checkbox they can check if they want to receive a copy, which must then be sent to the applicant within three days of the employer receiving the completed report.

There is one notable exception. If the employer is conducting a background check because they suspect the applicant has engaged in wrongdoing or misconduct, CIPA waives the requirement to provide notice and obtain the applicant’s consent for the background check.

CA Labor Code 432.7

According to CA Labor Code 432.7, California employers, either public or private, are prohibited from asking a job applicant about some aspects of their criminal history, including the following:

1. Criminal charges that did not end in a conviction.
2. Pre-trial or post-trial diversion programs.
3. Dismissed or sealed convictions.

It is also prohibited for a company to make hiring decisions based on the factors above. California employers are, however, permitted to ask about any currently pending criminal charges.

Redaction of Birthdates on Court Records

California employers need to know about the Court of Appeal’s decision in All of Us or None of Us v. Hamrick, Cal. Ct. App., 4th Appellate Dist., 1st Div. No. D076524 (2021).

The Court of Appeal reversed the trial court’s decision that court clerks do not have to redact dates of birth and driver’s license numbers from court records.

When the lower court received the case back, it then ruled on behalf of the plaintiffs, holding that as a matter of law, courts must redact birthdates and driver’s license numbers from court records.

The California Supreme Court denied a review of the decision. This means that courts will have to redact all personal identifiers from criminal court records other than names.

This change will immediately impact employment background checks in the state since consumer reporting agencies must rely on a minimum of two identifiers to verify that a criminal record belongs to an applicant.

Unverifiable criminal history information cannot be reported.

While the change will make employment background checks more difficult, iprospectcheck has already adapted new methods and processes to this decision.

We will still be able to provide reliable criminal history reports about applicants who have lived or worked in California to employers despite this change.

SB-731

SB-731 was signed into law by California Governor Gavin Newsom on September 29, 2022. The new law will automatically seal felony records for non-sex offender-related, non-violent offenses that meet the following criteria:

• The individual’s conviction took place after January 1, 2005.
• The individual has not been convicted of any new felony for four years.
• The individual’s sentence, probation, or parole was completed as directed.

The new law will expunge these records from public view and make them difficult for most employers to access during background checks.

Ban the Box and Fair Chance Hiring Laws

California Fair Chance Act

The California Fair Chance Act was effective on Jan. 1, 2018. This law applies to private and public employers in California with five or more employees unless an exception applies.

The Fair Chance Act prohibits employers from inquiring about an applicant’s criminal history before making a conditional job offer.

It also requires employers to complete an individualized assessment when an applicant’s criminal record is discovered before making a final decision not to hire the applicant.

Recently, some modifications were made to the regulations under the Fair Chance Act and went into effect Oct. 1, 2023. These changes are significant and are detailed in the following section.

Regulatory Changes under the FCA

The California Civil Rights Commission (CCRC) proposed modifications to Cal. Code Regs. tit. 2 § 11017.1, which is a regulation under the Fair Chance Act.

The California Department of Administration approved the changes, and they went into effect Oct. 1, 2023.

The modifications instituted a number of changes that employers must know, including:

• The definition of an applicant was expanded to include existing employees when they are under consideration for a promotion, transfer, etc.
• Employers are prohibited from inquiring about criminal history information or disseminating it in any form or manner before making a conditional job offer, including through background checks, internet searches, or other means.
• If an applicant voluntarily discloses a conviction, the employer may not consider it until after making a conditional job offer.
• Employers are expressly prohibited from including any language in advertisem*nts, applications, or other job-related materials that individuals with criminal records won’t be considered.
• If an employer violates the prohibition on inquiring into an applicant’s criminal record before making a conditional job offer, they can’t use the applicant’s non-disclosure of that information against them after making a conditional employment offer.
• Employers may never consider an applicant’s arrest that didn’t result in a conviction, an expunged record, a juvenile arrest or detention, or a non-felony marijuana conviction that is two or more years old.
• Employers that want to deny employment based on criminal history information learned through a background check, internet search, voluntary disclosure, or another means must first complete an individualized assessment that involves a consideration of the following factors: 1) the nature and severity of the conduct/offense; 2) how much time has passed since the offense; and 3) the duties of the job for which the individual is under consideration.
• The individualized assessment must be completed before the employer sends a preliminary notice of adverse action to the applicant.
• The employer must give the applicant at least five business days to respond to the preliminary notice from the date of receipt of the notice. This has been defined as two days after an email has been sent; five days if the notice was sent by mail in California; 10 days after a notice was sent by mail to an applicant in another state other than California; or 20 days after a notice was sent by mail to an international applicant.
• The employer must consider any evidence the applicant submits showing rehabilitation or mitigating evidence about the circ*mstances surrounding the conduct before making a final decision.
• If the employer makes a final decision not to hire the applicant, they must notify them in writing, include a copy of their rights, and inform them that they have a right to appeal the decision with the CCRC.

Fair Chance to Compete for Jobs Act

The Fair Chance to Compete for Jobs Act is a federal law that became effective on Dec. 20, 2021.

This law applies to federal agencies and federal contractors, including private companies that contract with the federal government.

Under this law, covered employers are prohibited from including questions about their applicant’s criminal histories on their applications.

They also can’t perform criminal background checks until they have made conditional offers of employment.

California Expungement Law

Under Cal. Pen. Code § 1203.4, some people convicted of misdemeanors or felonies in California can petition the court to have their records expunged.

Expungement removes the conviction from the individual’s criminal record, and an applicant with an expunged record is not legally required to report it.

People are eligible to apply for an expungement if they have been convicted of misdemeanors or felonies and have successfully completed probation and did not serve time in state prison.

It is also available to those who did serve time in prison but would have otherwise been sentenced to serve time in jail if they had committed the offense after realignment under 2014 Cal. Proposition 47.

People who served time in prison and served as firefighters in a prison fire camp are also eligible for expungement under 2020 AB 2147.

Certain crimes cannot be expunged regardless of whether the individual completed probation, including the following:

• Child p*rnography offenses
• Sexual assault crimes
• Lewd and lascivious acts with minors

If an applicant has expunged criminal records, they won’t have to voluntarily disclose them. A criminal background check for employment also won’t report expunged criminal records.

Governor Newsom’s Veto of SB 1262

The California Legislature passed SB 1262 and presented it to Gov. Newsom on Sept. 13, 2022, for his signature.

This bill would have corrected the problem caused by the All of Us or None of Us vs. Hamrick 2021 Court of Appeal decision that prevented background check companies from confirming criminal court records by date of birth.

The Legislature had added a single line to Cal. Gov. Code § 69842 to allow searches of publicly accessible electronic databases by dates of birth, driver’s license numbers, or both.

On Sept. 29, 2022, Gov. Newsom vetoed the bill and returned it to the Legislature with a memo stating that he could not sign it because it would allow members of the public in addition to background check companies to search publicly available electronic databases by date of birth or driver’s license and would thus override the Court of Appeal’s decision in Hamrick.

The veto means that it will continue to be difficult for employers to verify criminal record information for applicants and employees.

Conviction Relief: California’s Clean Slate Law

Gov. Gavin Newsom signed SB 731 into law on Sept. 21, 2022. This law is codified at Cal. Pen. Code § 851.93 and was effective on Jan. 1, 2023.

Under this new law, the California Department of Justice (CDOJ) must review court records each month and expunge any arrests that didn’t lead to convictions within three years of the arrest date.

They must also expunge any information about criminal matters for which the individual completed pretrial diversion, drug diversion, or another type of qualified diversion program.

Finally, this law allows people who have been convicted of felony crimes to petition the court to withdraw their guilty pleas and enter pleas of not guilty.

If the court finds that doing so is in the interest of justice, the guilty pleas will be withdrawn, and not guilty pleas will be entered.

While this process is not automatic, the effect of the entry of a not-guilty plea is that the previous conviction can’t be reported.

Under the clean slate law, automatically expunged criminal records can’t be reported, and individuals do not have to report them on applications or resumes or during interviews.

Dismissal and Sealing of Certain Past Marijuana Convictions

Following the passage of recreational marijuana in California, the Legislature passed AB 1793, which was signed into law by the Governor on Sept. 30, 2018.

Under this law, people with past convictions for marijuana possession, cultivation, distribution, or transportation of up to 28.5 grams of cannabis or up to eight grams of concentrated cannabis had their convictions automatically dismissed and sealed.

This means that those dismissed and sealed convictions will not be reported on criminal background checks for employment.

Employment Discrimination Based on Out-of-Work Marijuana Use Prohibited

California Gov. Gavin Newsom signed AB-2188 into law on Sept. 18, 2022.

This law prohibits employment discrimination against applicants and employees based on their use of marijuana outside of the workplace and will be effective on Jan. 1, 2024.

AB-2188 does not prohibit employer testing for marijuana, but employers can only act on positive drug test results when the tests reveal the presence of the psychoactive ingredient, delta-9-tetrahydrocannabinol.

Many drug tests return positive results for marijuana based on their detection of non-psychoactive metabolites that remain in the body long after someone has used marijuana and is no longer impaired.

The law includes the following exceptions:

• Employers required to test for marijuana by federal or state laws or regulations
• Positions requiring security clearances
• Employers that must test for marijuana as a condition of engaging in federal contracts
• Possession, use, or impairment during work hours or on the premises
• Jobs that require federal government background checks
• Employers in the construction and building trades

Applicants and employees who believe their employers have violated this law will be allowed to file discrimination complaints with the California Civil Rights Department (CRD) and to pursue discrimination lawsuits against their employers to recover damages.

Pay Transparency Law

SB 1162 was signed into law by Gov. Newsom on Sept. 27, 2022, and became effective on Jan. 1, 2023.

This law requires employers to post pay scales and ranges for positions in their job postings both internally and externally.

All employers with 15 or more employees are covered by this law.

Fair Chance Law for Caregivers and Home Health Applicants

Cal. AB 1720 was effective on Jan. 1, 2023.

This law allows people with old convictions to work as home health aides or as caregivers as long as they meet the qualifications and receive an exemption from the Department of Social Services.

Applicants and prospective volunteers with qualifying old convictions who are approved for exemptions can be hired by caregiving organizations despite licensing requirements.

Certain convictions are ineligible, including sex offenses, felony offenses, and others.

How to Get a Background Check in California

The California Department of Justice is mandated to maintain a statewide repository for criminal records.

Before you can secure criminal record information for your applicants, your company must first apply to become an authorized applicant agency with the DOJ.

Once the request has been submitted, your company will have to wait to receive authorization of approval.

Then, you will need to obtain written consent from your applicants on a specific form from the department.

Your applicants will have to get their fingerprints scanned by a Live Scan operator.

The fee is $32, which does not include the fingerprint rolling fees charged by the Live Scan operator.

Getting background information from the state will not provide you with all the information that you need. You will only obtain criminal records if any exist.

These checks do not return information about the educational or employment histories of applicants and will not provide you with a comprehensive picture of their backgrounds.

State criminal records might also not provide you with information about convictions that occurred outside of the state.

Some employers attempt to search court records in every jurisdiction in which an applicant has lived. However, this wastes valuable time for your human resources department and is very labor-intensive.

The best option is to request pre-employment background checks from a trusted partner like iprospectcheck. When you work with us, you can choose the specific types of information you need instead of getting extraneous results.

You can also feel confident that your pre-employment background checks will fully comply with all of the state and federal laws so that you do not rely on information for employment decisions that could get you in trouble.

What Disqualifies You on a Background Check in California?

Applicants might be turned down for jobs based on information contained in their background checks for multiple reasons.

Some of the most common reasons are described below.

1. Failing a Pre-Employment Drug Screen

Some employers condition offers of employment on passing pre-employment drug screens. These types of tests are requested to protect workplace safety.

If a candidate fails a pre-employment drug test, the employer will likely withdraw the conditional offer of employment.

2. Lying About Past Employment

A common reason why employers might decide against hiring applicants following completing background checks is discovering that they have lied about their past employment.

Some applicants try to embellish their experience by claiming to have held positions of greater responsibility or fudging their employment dates to hide gaps.

Employers that request education verification checks can easily spot these types of lies.

3. Lying About Education

Another common problem that can result in being denied employment is trying to lie about attending prestigious institutions or obtaining degrees that the applicants never earned.

Employers that request education verification checks can see these types of lies and will likely decide against hiring applicants who lie.

4. Having Disqualifying Criminal Convictions

Many people have criminal records and are still able to find jobs. A criminal conviction is not necessarily disqualifying.

However, when people apply for jobs for which the types of convictions they have that disqualify them because they directly relate to the tasks they might be asked to perform, an employer can base an adverse hiring decision on the conviction after individually assessing the conviction and completing the adverse action process.

5. Having a Bad Driving Record

People who apply for jobs that involve driving, such as truck driver positions, will likely have to undergo checks of their driving records.

If they have too many traffic violations or major traffic offenses on their records, the employers will likely turn them down.

This is because the employers might not be able to insure them, and hiring people with bad driving records to drive could expose the employers to negligent hiring liability.

As a California Employer, How Can I Stay Compliant?

Complying with laws like the Federal Fair Credit Reporting Act is critical, but even that is not enough to run a compliant screening program in California.

The penalties for violating California background check laws are severe.

In some cases, employers can be required to pay actual damages, or up to $10,000 per violation, in addition to the applicant’s attorney’s fees and costs.

Some courts may require employers to pay punitive damages, as well, which can be as much as ten times the amount of actual statutory damages.

With that in mind, here are four tips to remain compliant on background check laws in California, and avoid expensive fees:

1. Wait to Inquire About Criminal History

To protect yourself and your company, wait to inquire about an applicant’s criminal history until after you have issued a conditional offer of employment.

This includes asking applicants if they have ever been convicted of a crime, ordering a background check, or making other inquiries into an applicant’s criminal history.

2. Conduct Individualized Assessments

If an applicant has prior convictions, conduct an individualized assessment to determine whether those convictions have a direct, adverse relationship with the job’s specific duties.

If so, this would justify the denial of the candidate’s application.

3. Notify the Applicant of Potential Adverse Action

If you intend to take adverse action based on the findings of a criminal background check, you must notify the applicant.

Your notice must include the following elements:

• An identification of the conviction.
• A copy of the conviction history report – regardless of whether you prepared it internally or had it developed by a third-party company.
• Notification of the applicant’s deadline to provide clarifying information for the background check, such as evidence of inaccuracy, or rehabilitation documentation.

4. Provide a Final Adverse Action Notice

If you ultimately proceed with adverse action, you must notify the applicant of your final decision.

You must also make the applicant aware of their right to challenge the decision, request reconsideration, and file a complaint with the Department of Fair Employment and Housing.

While complying with California background check laws can be challenging, following these guidelines can help you avoid issues.

Keep in mind that, in addition to federal and state laws, Los Angeles and San Francisco have enacted their own versions of California “Ban the Box” laws.

Los Angeles, for example, passed an ordinance that applies to all city businesses with ten or more employees, as well as all city contractors.

The law states that employers cannot investigate an applicant’s criminal history until after they’ve issued a conditional offer of employment.

Additionally, employers must conduct an individual assessment of the applicant’s criminal background as it relates to the responsibilities and duties of the open position.

iprospectcheck: Your Trusted Partner for Fast, Accurate, Compliant California Background Checks

Properly conducted pre-employment background checks can protect your business and its reputation. When you conduct a background check on an applicant, you must make sure that you follow all of the applicable laws.

At iprospectcheck, we work to remain up to date with changes to the laws as they occur. Our team members are thoroughly trained and know the requirements they must follow when they conduct pre-employment background checks and send reports to our clients.

To learn more about our pre-employment background checks and how we can help you, contact iprospectcheck today to schedule a no-obligation, free consultation or call (888) 509-1979

DISCLAIMER: The resources provided here are for educational purposes only and do not constitute legal advice. Consult your own counsel if you have legal questions related to your specific practices and compliance with applicable laws.