News of an Employee’s Arrest or Pending Criminal Charges Poses a Dilemma for California Employers

Every day, the press reports on arrests for one reason or another in California and other states. Many of those arrested have jobs. In turn, the employers of the arrestees in California are confronted with a dilemma: on the one hand, the fact of the arrest may raise concerns about an employee’s suitability for continued employment (e.g., if the employee stands accused of violent, threatening, destructive, or other serious misconduct); on the other hand, state law affords the employee certain rights. Navigating between these competing risks requires careful consideration of the specific circumstances.

California Labor Code § 432.7, which provides a private right of action for damages (including treble damages) and attorney’s fees and costs, restricts an employer’s discretion to rely on “any record of arrest or detention that did not result in conviction” to discipline an employee, including terminating employment.¹ Case law extends this prohibition to pending criminal charges even though Section 432.7 states: “This section shall not prevent an employer from asking an employee . . . about an arrest for which the employee or applicant is out on bail or on their own recognizance pending trial.”²

However, case law also confirms that a Section 432.7 claim is not ripe unless and until the criminal proceeding is finished and in fact did not result in a criminal “conviction.”³ But employers are often put in a difficult situation because they learn of an employee’s arrest before charges are even filed or while charges are pending. Notice can come from various sources, including the employee (e.g., if the employee is unable to report to work or if the employer requires employees to self-report arrests or charges); the media, including local crime blogs; law enforcement, etc.⁴

How much latitude an employer has will depend on the particular facts. Thus, employers are advised to consult with experienced in-house or outside counsel before discipling an employee based on any record of arrest or detention or pending charges. Fundamentally, though, employers are not paralyzed from taking any steps at all to protect their other employees, customers, assets, and reputation.

First, no published case law specifically imposes a duty on employers to accommodate or excuse an employee’s inability to come to work due to incarceration, i.e., employers are allowed to enforce a standardized attendance control policy.⁵ Employers arguably can hold such an employee to their attendance policies to the same extent they would do so with other employees. Anecdotally, however, employees are often released pending trial for minor offenses.

Second, no published case law specifically imposes a duty on employers to accommodate an employee’s restrictions while released pending trial. For example, courts may prohibit employees arrested for certain crimes, such as computer crimes or certain sexual offenses (e.g., possession of child pornography), from accessing computers.

Third, published case law upholds an employer’s right to independently investigate the conduct resulting in an employee’s arrest or pending criminal charges and to discipline an employee based on the facts that surface therefrom, including factual statements obtained by interviewing the employee. Yet, employers must be cautious about the specific factual basis for taking any disciplinary action even if they conduct an investigation.

In sum, while California employers may take common-sense measures to protect themselves, their employees, customers and clients, employers should pause to carefully consider the applicable legal constraints before disciplining an employee after learning of an arrest or pending charges. Due to a significant spike in claims brought under California’s state Fair Chance Act, Government Code § 12952, which protects “applicants,” it is also prudent for employers to conduct a privileged review of their background check programs, including policies and procedures and pre-adverse and adverse action notices.⁶