On March 23, 2021, Illinois Governor J.B. Pritzker signed The Employee Background Fairness Act (the “Act”) into law effective immediately. The new law amends the Illinois Human Rights Act, the Illinois Equal Pay Act, and the Illinois Business Corporation Act.
The most significant impact to employers is the amendment of the Illinois Human Rights Act, which applies to employers with one or more employees. Employers are now prohibited from making adverse employment decisions based on a conviction record of a job applicant unless there is a substantial relationship between one or more of the previous criminal offenses and the employment sought or held or the granting or continuation of the employment would involve an unreasonable risk to property or to the safety or welfare of specific individuals or the general public.
The Employee Background Fairness Act defines conviction record as “information indicating that a person has been convicted of felony, misdemeanor or other criminal offense, placed on probation, fined, imprisoned, or paroled.” To determine if a “substantial relationship” exists, an employer must consider whether the position offers the opportunity for a similar offense to occur. The Act also lists the following factors for employer consideration:
- the length of time since the conviction;
- the number of convictions that appear on the conviction record;
- the nature and severity of the conviction and its relationship to the safety and security of others;
- the facts or circumstances surrounding the conviction;
- the age of the employee at the time of the conviction; and
- evidence of rehabilitation efforts.
Further, an employer who preliminarily decides that an employee’s conviction record disqualifies the employee is required to provide written notice to the employee that contains:
- notice of the disqualifying conviction or convictions that are the basis for the preliminary decision and the employer’s reasoning for the disqualification;
- a copy of the conviction history report, if any;
- and an explanation of the employee’s right to respond to the notice of the employer’s preliminary decision before that decision becomes final.
The employer must provide the employee with at least five (5) business days to respond to the notification before making a final employment decision. Upon making the final decision, the employer must provide an additional written notice that contains:
- notice of the disqualifying conviction along with the employer’s reasoning;
- any existing procedure for the person to request reconsideration or challenge the decision; and
- notice of the right to file a charge with the Illinois Department of Human Rights.
To assist Illinois employers with compliance, the IDHR has developed an FAQ which indicates an interactive assessment of the relationship between the conviction and the job. Question 19 also indicates that an employer may not inquire about an applicant’s criminal record until after an offer of employment has been made, however, the Act makes no amendments to the Job Opportunities for Qualified Applicants Act of 2015, which prohibits inquiry, consideration, or disclosure requirement of a criminal history prior to a job interview, or prior to the job offer if there is no interview. Additionally, the interaction between the requirements of this new law and the Fair Credit Reporting Act is to be determined.
Larger employers are impacted by the Act’s amendment of the Business Corporation Act of 1983 to add a requirement for employers who must file the federal EEO-1 report to submit “substantially similar” information along with the corporation’s annual report filed on an after January 1, 2023. The IL Secretary of State will approve a format for this submission. Employers with 100 employees (individually or under common ownership as defined under the FLSA) as well as federal government contractors and first-tier subcontractors with 50 or more employees and at least $50,000 in contracts are required to file reports with the EEOC.
Equal Pay Registration Certificate
Another impact for private employers with 100 or more employees, in Illinois, is a new requirement to obtain an “equal pay registration certificate” by March 23, 2024, and to recertify every two years thereafter. In order to apply for the registration certificate, employers must submit their most recent EEO-1 report, a list of all employees during the past calendar year separated by gender, race, and ethnicity with wage information, a statement of specific areas of compliance with various state and federal equal pay and discrimination laws along with information about the company’s method of setting benefits and compensation, and a $150 filing fee.
Finally, the Act prohibits employers from taking any retaliatory action against an employee who reports or threatens to report any activity or policy that they reasonably believe is in violation of a law, or participates in legal proceedings related to enforcement of the Act.
In order to ensure compliance with this new law, employers should evaluate and update their background check policies and practices. Hiring and promotion decisions and processes in Illinois should reflect these new considerations.
Applicable employers should consider reviewing current employee demographic data and pay practices and take any corrective actions necessary to properly submit the annual report and satisfy the requirements of the equal pay certificate. MBA is available assist with providing and reviewing employee data as needed.
If you have any questions or would like further detail or assistance complying with the Act, please contact an HR Consultant at (727) 563-1500 or at firstname.lastname@example.org.
*The information provided in this communication is general in nature and is for informational purposes only. It should not be construed as legal, tax, or accounting advice.