Fair Chance Hiring ordinance -- amendments for consideration

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Greg Casar
Posts: 189
Joined: Tue Jan 20, 2015 3:20 pm

Fair Chance Hiring ordinance -- amendments for consideration

Post by Greg Casar »

Colleagues:

After nearly a year of debate, public input, stakeholder meetings, committee meetings, and several work sessions, I am glad that we will finally have a chance to vote on the Fair Chance Hiring ordinance on this week’s agenda.

I believe the Economic Opportunity Committee made sound recommendations for the Council. In the last few weeks as we’ve approached a final decision, I’ve continued reaching out to business and community leaders to craft the best ordinance possible. I received requests for many amendments to the recommended ordinance. After much consideration, I believe that six of these amendments will balance the concerns of all sides and make for good policy. Below are the amendments listed with a description of each. Amendments #1, 2, 5, and 6 will make it easier for businesses to comply with the rules, and amendments #3 and #4 will make the ordinance more enforceable. You can see a copy of the ordinance linked here that I will propose Thursday, with the amendments incorporated: http://assets.austintexas.gov/austincou ... 180854.pdf

Amendment #1: Requires that the City use the same guidelines as the Equal Employment Opportunity Commission when assessing whether or not an employer violated the ordinance, rather than the posted ordinance language which allows the City to use its own guidelines.

Amendment #2: Allows employers to give applicants, in writing, the employer’s criminal background check processes and explanation on how the employer considers criminal history.

Amendment #3: Gives applicants 90 days to make a complaint once they’ve learned of a violation. No applicant can file a complaint more than a year after a violation.

Amendment #4: Makes the civil penalty for violation $500, the same as our other non-discrimination rules. Note that amendment #5 allows for warnings before any such penalty is incurred.

Amendment #5: For the first year after the ordinance passes, no citations shall be issued, only warnings. After the first year, an employer can receive a warning for a first-time violation of this ordinance if the employer participates in a training to understand the requirements of the ordinance.

Amendment #6: Requires that the City include a website with best practices for complying with the ordinance for employers as part of the education campaign.

Please note that there are a couple of clarifications in the attached ordinance, suggested to us by City legal: making it explicit rather than implicit that the City will set up a process for handling anonymous complaints and clarifying the 501(c) status of membership organizations.

One last point:
As you know, the Council has substantial support from business and community leaders for the Fair Chance ordinance as recommended by the Economic Opportunity Committee. The Council has been presented letters of support from Presidents/CEOs of the Young Chamber of Commerce, the Black Chamber, the Gay & Lesbian Chamber, and the Hispanic Chamber. Although they are directionally supportive of Fair Chance Hiring, the Greater Austin Chamber of Commerce has expressed continued concerns about the ordinance and has opposed its passage for Thursday. Amendments #1, 2, 5, and 6 are specifically drafted to address many of the issues their membership has communicated to my office.
Some have also communicated their general opposition to a core component of the ordinance: delaying the background check until the very end of the hiring process (the conditional offer stage). This is a critical component of the ordinance and a national best practice. It creates the most opportunity for employment for our constituents who need it. The National Employment Law Project has a useful brief that explains why cities such as Washington D.C., New York, Columbia (MO), and Philadelphia have successful ordinances that delay conviction inquiries until the end of the process. That brief is available here: http://www.nelp.org/content/uploads/Fai ... -Offer.pdf

A useful excerpt from the brief follows: “a candidate who is asked about his or her record prior to receiving a conditional offer faces ambiguity and uncertainty about the role his or her past conviction played in the employment decision. The employer may turn down the candidate for a variety of reasons unrelated to a prior conviction. Regardless, the applicant is unclear about the reason for denial. An employer that waits to inquire into a conviction history until the conditional-offer stage will not cause this uncertainty. The employer can assure the job candidate, and any enforcement agency that is investigating a complaint, that the individual was considered fully for the position.”

I look forward to further discussion tomorrow,
Greg
Gregorio "Greg" Casar
Council Member District 4
Don Zimmerman
Posts: 168
Joined: Fri Jan 09, 2015 11:05 am

Re: Fair Chance Hiring ordinance -- amendments for considera

Post by Don Zimmerman »

CM Casar,
Consistent with requests from the Austin Chamber of Commerce and other groups and employment experts, I will move to postpone the vote on this unFair Hiring Ordinance until May (2016); if that fails, I will make several amendments consistent with the objections listed below, compiled in collaboration with the Texas Public Policy Foundation. I will be referring to the ordinace as "un"Fair, owing to the unfair burdens it places on thousands of small businesses which are already struggling to survive in this city.


Reasons to Oppose (un)Fair Chance Hiring Practices

• It is Going to Cost Local Businesses Serious Time and Money in Compliance Costs to Prevent Penalties and Litigation, While Stymieing Hiring and Growth:

Every business in Austin with fifteen (15) or more employees has to comply with the onerous regulations that this ordinance enacts. This will require very small businesses to pay thousands in compliance costs to prevent large penalties and prevent lawsuits from a prospective employee for negligent hiring practices. This will take money out of businesses bottom line, which could have been spent on new hires as well as investment and innovation. Additionally, if an investigation is triggered, the employer must bear the costs of producing documents and information, or face criminal penalties. Just another added cost and red tape for small business.

• Waiting Until a Conditional Offer of Employment is Made is Unduly Burdensome

The ordinance requires businesses to wait until a conditional offer of employment is made. This is unduly burdensome and will cost employers greatly in costs wasted on prospective hires that are unquestionably unfit for the job. It is a waste of time for the employer and employee to go so far into the hiring process only to be unfit for the job. Additionally, many hires require employers to pay for travel costs to bring prospective employees in to interview in person. Paying hundreds or thousands of dollars on wasted travel costs for an unfit candidate is unduly burdensome

• The Legality of Fair Chance Hiring is Highly Questionable

The ordinance states that it is within their police power to pass these regulations. Generally, a city has broad range in exercising its police power to promote the health, safety, and general welfare of its citizens. However, the City of Austin can only pass the ordinance (based upon their police power) if it is “substantially related” to the health, safety, or general welfare of the people, and if the ordinance is not arbitrary. In other words, the ordinance must substantially advance the legitimate goals of the city in a non-arbitrary manner. See City of College Station v. Turtle Rock Corp., 680 S.W.2d 802, 805 (Tex. 1984); Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 933-34 (Tex. 1998). A strong argument could be made that not only is requiring private businesses to abide by fair chance hiring practices not substantially related to the health, safety, or general welfare of the City of Austin, it is an unreasonable burden on local, private businesses. In fact, the City of Tampa, Florida held off on similar “Ban the Box” legislation for this very reason. "We run the risk of having a scheme that could be overturned," Julia Mandell, City of Tampa attorney said, "and it could be very costly."



• The Ordinance Creates an Uncertain Business Environment

Austin, a city known for innovation and a pro-business environment is quickly becoming a city synonymous with over-regulation (e.g. Uber/Lyft and short-term rental regulations). Many companies that wish to do business with the city may be hesitant to open themselves up to civil liability by working with the city for more than 20 weeks in a calendar year (which triggers the requirements of this ordinance). This would be costly to the city in a variety of ways. For example, the many private and public construction sites we see being built around the city are not all built by local contracting companies (unlikely many are). These businesses do not perform most of their business in the city but would be under the ordinance if they were to bid on job. Would the best hire for the job now either increase their bid or not bid at all? Would bid protests for public works jobs increase because it is an unfair advantage for businesses already within the city bounds with hiring’s in compliance with the ordinance to bid at a lower cost? This ordinance is just another example of Austin moving backwards on innovation and growth.

• There is Major Grey Area How the Bill Will Actually Operate

Under § 4-15-6(C), if a violation is found under the ordinance, and voluntary compliance cannot be obtained, the Equal Opportunity/Fair Housing Office may assess a civil penalty and provide notice to the employer. However, under § 44-15-8 (A), the ordinance states that an employer has ten days after receiving written notice of the violation before the city will assess a civil penalty of $500. It is uncertain based upon this language (assuming that this violation occurs one year after the effective date) that an individual on his or her first violation has ten days before being fined to cease the violation or not (“cease” the violation is not defined either and seems impossible in certain situations). Further, there is not state of mind requirement, meaning that an individual can be potentially fined $500 for accidentally breaking this ordinance. A warning issuance on the first violation should be required, not optional.
Don Zimmerman
Council Member District 6 (northwest Austin)
Greg Casar
Posts: 189
Joined: Tue Jan 20, 2015 3:20 pm

Re: Fair Chance Hiring ordinance -- amendments for considera

Post by Greg Casar »

Colleagues,

Please see the most recent amended version of the ordinance below:

http://assets.austintexas.gov/austincou ... 202305.pdf

Best,

Greg
Gregorio "Greg" Casar
Council Member District 4
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