Background Checks in California: Fair Chance Act, Clean Slate, and Limits

California background check laws are stricter than federal rules in almost every direction that matters. Employers with five or more workers cannot ask about criminal convictions until after a conditional job offer. Most negative information disappears from reports after seven years. Arrests without convictions, sealed records, and certain old marijuana offenses are off-limits entirely. And before any report is pulled, the applicant or tenant has to receive a specific written disclosure and give written permission.

When Employers Can Ask About Criminal History

The Fair Chance Act, Government Code section 12952, controls the timing. If you employ five or more people, you cannot put a conviction-history question on a job application, and you cannot ask about or consider convictions until after extending a conditional offer. Job postings also cannot say that people with criminal records need not apply.¹

Once a conditional offer is out and a conviction turns up, the employer cannot simply pull the offer. The law requires a written individualized assessment that weighs three things: how serious the offense was, how much time has passed since the conviction or completion of the sentence, and the specific duties of the job.²

If the employer still wants to rescind, the applicant gets at least five business days to respond. During that window the applicant can challenge the accuracy of the report or submit evidence of rehabilitation. An applicant who notifies the employer in writing that they are disputing the record and gathering proof gets another five business days. Any final denial must come in writing and must tell the applicant they can file a complaint with the Civil Rights Department.²

Jobs the Fair Chance Act Does Not Cover

Several categories fall outside the law: positions where a state or local agency is already required by law to run a criminal background check, positions within criminal justice agencies, farm labor contractor roles, and any position where state, federal, or local law requires a background check or restricts hiring based on criminal history. That last category sweeps in a range of regulated roles, including financial services positions covered by federal self-regulatory organizations like FINRA.²

Federal contractors have to follow California’s rules too. The federal Fair Chance Act does not preempt state or local ban-the-box laws, so federal contractors operating in California comply with both.

What Cannot Appear on a California Background Check

Under the Consumer Credit Reporting Agencies Act, most negative information older than seven years is barred from consumer reports. That covers old lawsuits, paid tax liens, collection accounts, and criminal records. For criminal convictions, the seven-year clock starts from the date of disposition, release, or parole, not from the date of arrest.³

Several categories of criminal history are off-limits regardless of how recent they are:

Arrests or detentions that did not lead to a conviction cannot be disclosed or used in hiring.⁴
Participation in any pretrial or post-trial diversion program cannot be reported or considered.
Convictions that have been judicially dismissed or sealed under the Penal Code are treated as if they never happened for employment purposes.⁴
Certain non-felony marijuana possession offenses cannot be reported or considered if they are more than two years old.⁵

Employers who intentionally violate these prohibitions owe the greater of $500 or three times the applicant’s actual damages, plus reasonable attorney fees and a fine of up to $500.

Automatic Sealing Under the Clean Slate Act

SB 731 created an automatic sealing process that does not require filing a petition. The California Department of Justice reviews records and grants relief when the eligibility criteria are met. How quickly a record qualifies depends on the type of conviction:

Infractions and misdemeanors become eligible once the person has completed their sentence and at least one calendar year has passed since the date of judgment.
Probation cases become eligible once the person appears to have completed probation without revocation.
Felonies become eligible four years after completing all terms of incarceration, probation, supervision, and parole, provided the person was not convicted of a new felony during that time.⁶

Serious felonies, violent felonies, and offenses that require sex offender registration are permanently excluded from automatic sealing. The person also cannot have active supervision or pending charges.⁶

Once a record is sealed, it effectively vanishes from employment background checks and employers cannot ask about it. Law enforcement, courts, and the DOJ keep access, and a few narrow exceptions apply, such as running for public office. For most job seekers, an automatically sealed record is invisible to prospective employers.

Off-Duty Cannabis Use

Since January 1, 2024, California employers with five or more workers cannot penalize applicants or employees for using cannabis off the job and away from the workplace. The protection extends to drug testing: an employer generally cannot deny someone a job because a screening detected non-psychoactive cannabis metabolites, which only show past consumption rather than impairment at work.⁷

A scientifically valid test that detects psychoactive THC may still give the employer grounds to act. The protections do not apply to positions requiring a federal background investigation or security clearance, to employees in the building and construction trades, or to employers with four or fewer workers.⁷

When a lawful background check turns up prior cannabis-related convictions, the employer may only consider that information to the extent the Fair Chance Act allows. Between automatic sealing, the two-year ban on old marijuana convictions, and the off-duty use protections, cannabis history has very limited impact on California employment decisions today.

Required Disclosure and Authorization Before a Check

Before any investigative consumer report is ordered, California requires a specific written process that goes beyond the federal Fair Credit Reporting Act. Under Civil Code section 1786.16, the person requesting the report must give the applicant a clear and conspicuous written disclosure in a standalone document that contains nothing else. Burying the disclosure inside a broader application or lease packet violates the law.⁸

The standalone disclosure must state that an investigative consumer report may be obtained, the purpose of the report, that it may include information about character and reputation, and the name, address, and telephone number of the reporting agency. It must also describe the nature and scope of the investigation, including whether interviews with acquaintances or neighbors are involved.⁸

The form must include a checkbox the applicant can mark to request a free copy of the final report. If the applicant checks it, the employer or landlord must send a copy within three business days of receiving the report. The applicant also has to authorize the report in writing before it can be pulled.⁸

Tenant Screening

Landlords who run background checks face the same restrictions on criminal history as employers. The seven-year limit, the ban on arrest-only records, and protections for sealed or dismissed convictions all apply. So do the standalone disclosure and written authorization rules under the Investigative Consumer Reporting Agencies Act.

Civil Code section 1950.6 also caps what a landlord can charge for a screening fee. The statute set the base cap at $30 per applicant in 1998, adjusted annually by the Consumer Price Index, which puts the current cap in the range of $60 to $65.⁹ The fee can only cover actual screening costs, such as obtaining a credit report or checking criminal records; landlords cannot keep the difference as profit. If the landlord already has recent screening information in hand, they cannot charge again, and if they decide not to accept the application before running any screening, they have to refund the fee.

What a Violation Is Worth

Each law carries its own penalty structure, and the numbers add up quickly.

For violations of the Investigative Consumer Reporting Agencies Act, the person whose rights were violated can recover $10,000 per violation or actual damages, whichever is greater, plus attorney fees and court costs. Grossly negligent or willful conduct can add punitive damages.¹⁰ The $10,000 figure is a statutory penalty, so the applicant does not have to prove concrete financial harm to recover it.

Under the Consumer Credit Reporting Agencies Act, negligent violations expose the reporting agency to actual damages, including lost wages, plus attorney fees. Willful violations carry punitive damages ranging from $100 to $5,000 per violation.¹¹

Employers who intentionally use arrest records, sealed convictions, or old marijuana offenses face the greater of $500 or three times the applicant’s actual damages, plus attorney fees and a separate fine of up to $500.⁴

These violations are frequent class action material. A single procedural failure, such as bundling the disclosure with other forms instead of using a standalone document, applied across hundreds or thousands of applicants, turns into significant liability. The paperwork rules are not formalities in California.

1
California Civil Rights Department. Fair Chance Act
2
California Legislative Information. California Code GOV 12952 – Unlawful Employment Practice Regarding Conviction History
3
California Legislative Information. California Code Civil Code CIV 1785.13 – Consumer Credit Reporting Agencies Act
4
California Legislative Information. California Code LAB 432.7 – Contracts and Applications for Employment
5
California Legislative Information. California Labor Code 432.8
6
California Legislative Information. California Penal Code 1203.425
7
California Civil Rights Department. Discrimination in Employment – Use of Cannabis FAQ
8
California Legislative Information. California Code CIV 1786.16 – Investigative Consumer Reporting Agencies
9
California Legislative Information. California Code CIV 1950.6
10
California Legislative Information. California Code Civil Code CIV 1786.50
11
California Legislative Information. California Code Civil Code CIV 1785.31