The top compliance trends impacting the hiring landscape: A Q&A with Kelly Uebel
Kelly Uebel, General Counsel at Asurint shares the biggest compliance trends that are impacting the hiring landscape this year.
HR leaders constantly have to adjust their hiring practices to not just comply, but also find top talent in an evolving market. Kelly Uebel, General Counsel at Asurint shares the biggest compliance trends that are impacting the hiring landscape this year and how employers can recruit top talent while remaining compliant with local, state and federal laws.
What are some of the top compliance trends impacting the hiring landscape this year?
From a criminal background check perspective, two key trends are impacting the background screening process: clean slate laws and fair chance laws.
Clean slate laws continue to gain increased interest across the country, having been passed in a small handful of states such as California, New York, Michigan and Connecticut. These laws are designed to automatically expunge, seal or set aside certain criminal convictions after a specific time period has passed (unfortunately each state differs on types of eligible crimes and the timelines). As these laws take effect, employers may see a reduction in criminal convictions reported and may also see delays in the background check fulfillment. For example, in April 2023, Michigan’s clean slate act took effect leading to weeks of delays in processing criminal record requests, along with courts limiting the look back period for record availability while randomly imposing fees. Employers had to scramble to adjust hiring timelines as they waited for criminal checks to complete and potentially did not receive a full lookback given the variety of struggles courts had in implementing this legislation.
Fair chance laws continue to gain steam in terms of popularity across the country. More recently, Los Angeles County implemented a complex Fair Chance Ordinance that layers on additional requirements on top of the existing state law – which is already one of the most restrictive laws in the country. Employers will need to revisit their adverse action processes, conditional offer paperwork, job advertisements and review of criminal history information before the law takes effect September 3rd. We’ve also seen various cities and counties, such as Lehigh County, Pennsylvania, adopt anti-discrimination ordinances offering further employment protections for individuals with a prior criminal history.
From a drug testing perspective, states continue to legalize medical and/or recreational marijuana (or decriminalize it). Employers in certain states, such as Connecticut, Pennsylvania, New Jersey and Massachusetts, continue to face an increased litigation risk associated with these laws particularly related to medical marijuana users.
Can you provide examples of recent regulatory changes that are influencing how employers approach recruiting and talent acquisition processes?
In addition to the above legislative changes, the Equal Employment Opportunity Commission (EEOC) continues to focus on how employers leverage criminal history information as well. For example, the EEOC recently filed suit against a regional convenience chain alleging the employer’s “longstanding practice of screening all job applicants for records of criminal conviction and then denying them employment based on those records” discriminated against “Black, Native American/Alaska Native and multiracial applicants.” Employers are encouraged to review the allegations put forth by the EEOC as the complaint advances several concepts that do not appear in the Agency’s 2012 guidance on the use of criminal and arrest records in employment decisions. For example, the EEOC claims the employer did not identify the specific conviction(s) that formed the basis of the decision and did not have a process for candidates to seek reconsideration of the employment denial – both concepts we’ve seen in a small handful of fair chance laws across the country but arguably not widely adopted practices by employers.
As it relates to drug testing, many employers have started to evaluate if it makes sense to continue testing for marijuana or if marijuana should be removed from their drug testing panels. Employers should consider a variety of factors such as the industry they operate in, positions being filled, how they’ve leveraged positive marijuana results in hiring decisions and if their workplace drug policies need to be modified.
How are some of these trends currently impacting employers’ hiring processes, decisions and policies?
Employers need to understand how these laws and changes in requirements may impact their background screening process. For example, the Los Angeles County Fair Chance Ordinance will undoubtedly slow down the time between extending a conditional offer, obtaining a background check and completing any sort of adverse decision based on that background check (employers cannot fill the position during the required waiting period). In theory, a position could be held open for more than 15 business days before an employer could move on to an alternate candidate which can be a significant delay.
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How can employers recruit top talent while remaining compliant with local, state and federal laws?
Some employers have started to lean into these laws, particularly as it relates to criminal justice reform. Reevaluating the criteria related to individuals with a prior criminal history by not excluding those individuals outright but rather conducting individualized assessments to see if the person is the right fit for the role despite that criminal history can significantly open up the pool of potential candidates. Incorporating practices such as individualized assessments help employers comply with city, county and state fair chance laws that may require such a practice while also coming into compliance with the EEOC’s guidance (although the guidance is not law, the EEOC has sued a variety of employers).
As it relates to drug testing, employers may find that removing marijuana from their drug testing panel will also open up the candidate pool especially as the general attitudes towards marijuana use has relaxed across the country and more individuals choose to imbibe.
Can you discuss the role of diversity, equity, and inclusion initiatives in relation to compliance requirements and talent recruitment strategies?
DEI initiatives aren’t necessarily incorporated into the background screening process, although some employers may start to evaluate the impacts of their hiring processes and criteria across their employee population. For example, in the EEOC lawsuit referenced earlier, the EEOC pointed to statistics from the employer’s hiring practices that showed statistically that Black, American Indian/Alaska Native and multiracial job applicants were routinely rejected at higher rates than White applicants. It may be advisable for employers to look into these statistics and alter hiring processes/criteria as needed.