EEOC Withdraws Its Criminal Background Check Guidance: What Employers Should (and Should Not) Do Now
On October 29, 2026, the U.S. Equal Employment Opportunity Commission (“EEOC”) announced that it has rescinded, effective immediately, its 2012 Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions under Title VII. The Commission voted 2–1 the day before.
Some employers may read this as a green light to tighten background screening or drop the extra steps they built around criminal records. For most of our clients, especially those hiring in California, that would be a mistake. The federal guidance is gone, but the law is not.
What Changed
The EEOC’s 2012 guidance outlined how employers should consider criminal records in hiring, particularly when screening policies could disproportionately affect applicants based on race or national origin. It emphasized three key principles:
Job-Related Screening: Consider the nature and severity of the offense, time elapsed, and relevance to the position.
Individualized Assessment: Evaluate applicants on a case-by-case basis rather than applying blanket exclusions.
Arrests vs. Convictions: Distinguish between arrest records and actual convictions.
What does the rescission mean for employers? The EEOC will no longer rely on the 2012 guidance, and the older policies it replaced will not be reinstated. While the agency is shifting away from prioritizing disparate-impact enforcement, it will continue pursuing intentional discrimination.
The bottom line: Title VII remains unchanged. Disparate-impact claims are still legally actionable, and employers may still face private lawsuits over discriminatory hiring practices.
What Did Not Change
The EEOC’s policy shift does not change employers’ legal obligations. Federal anti-discrimination protections remain in place, and California employers must continue complying with state and local background check requirements.
Title VII Still Applies: Hiring policies that disproportionately exclude protected groups may still violate federal law unless they are job-related and consistent with business necessity. Applicants can still bring private lawsuits (42 U.S.C. § 2000e-2(k)).
California’s Fair Chance Act Remains in Effect: Employers with five or more employees generally cannot inquire about conviction history before making a conditional job offer. If a conviction is discovered, employers must assess its direct and adverse relationship to the position before withdrawing an offer. This includes providing written notice, allowing at least five business days for a response, granting additional time when legally required, and issuing a written final decision (Cal. Gov. Code § 12952).
Enforcement Continues: California's Civil Rights Department remains active. In 2026, FedEx reached an $85,000 settlement, while Ralphs agreed to pay $200,000 over alleged Fair Chance Act violations.
Certain Records Remain Off-Limits: California generally restricts employers from considering arrests without convictions, certain diversion records, sealed or dismissed convictions, and specified marijuana-related records, subject to statutory exceptions (Cal. Lab. Code §§ 432.7–432.8).
Local Laws May Be Stricter: San Francisco, the City of Los Angeles, and unincorporated Los Angeles County impose additional requirements, including fair chance notices, workplace postings, and waiting periods.
FCRA Requirements Still Apply: Employers using third-party background check providers generally must obtain proper authorization, provide required disclosures and pre-adverse action notices, and issue final notices. Willful violations can result in statutory damages of $100–$1,000 per affected consumer, among other remedies (15 U.S.C. §§ 1681b, 1681m, 1681n).
The bottom line: Rescinding federal guidance does not eliminate legal exposure. Employers must still follow Title VII, California's Fair Chance Act, applicable local ordinances, and federal and state background check requirements. A streamlined hiring process cannot come at the expense of compliance.
Which Employers Should Pay Extra Attention?
The impact of the EEOC’s decision will vary by business, but the biggest risks often arise from how hiring policies are implemented across different teams, locations, and jurisdictions. Four groups should pay particular attention:
California Employers: Day-to-day practices should remain largely unchanged. The priority is ensuring existing procedures are consistently followed, particularly across hiring teams and locations.
Startups and Growing Companies: Speed should not come at the expense of compliance. As hiring scales, automated screening tools and standardized rejection criteria can introduce risks that are easily overlooked.
Multi-State and Remote Employers: A company-wide screening framework can improve efficiency, but local requirements must be built into the process. Where employees actually work matters more than where the company is headquartered.
Companies with Overseas Headquarters: Hiring forms and screening policies developed abroad may not meet U.S. requirements. For logistics, e-commerce, and AI companies, screening criteria should also reflect actual job responsibilities, such as driving, financial access, or handling sensitive technology.
The bottom line: A consistent hiring policy does not mean identical procedures everywhere. Employers should align screening practices with their workforce, business operations, and applicable local laws.
Practical Steps for Employers
The EEOC’s policy shift is an opportunity to review existing hiring practices, not loosen compliance standards. Employers should focus on seven practical steps:
Keep Existing Safeguards: Maintain individualized assessments and written-notice procedures where required.
Review Hiring Materials: Remove prohibited criminal history questions and include required fair chance statements in job postings.
Get the Timing Right: In California, generally wait until after a conditional offer to inquire about conviction history, subject to applicable exceptions.
Audit Background Check Vendors: Ensure screening systems allow human review and that disclosure and authorization forms meet current requirements.
Document Hiring Decisions: Record how a conviction relates to the specific position when it affects an employment decision.
Train Hiring Teams: Make sure recruiters and managers understand what they can ask, when they can ask it, and how to handle background check results.
Monitor Legal Updates: Stay informed about changes to state and local fair chance requirements.
The bottom line: Federal enforcement priorities may change, but employers' legal responsibilities remain. The safest approach is to keep hiring practices consistent, job-related, and compliant with applicable laws.
The EEOC’s rescission signals a shift in federal enforcement, not a green light to relax hiring standards. Employers should act now to review their background check policies and address potential compliance gaps. Need to update your hiring practices? Contact ILS at contact@consultils.com to protect your business and reduce legal exposure.
Disclaimer: The materials provided on this website are for general informational purposes only and do not, and are not intended to, constitute legal advice. You should not act or refrain from acting based on any information provided here. Please consult with your own legal counsel regarding your specific situation and legal questions.
As Partner and Head of Transactions at ILS, Fiona delivers professional legal and strategic support to tech companies—with a focus on AI, medical devices, and fintech. Beyond full-spectrum technology law, she specializes in export control and compliance: supporting tech firms at all growth stages, aiding startups in scaling operations, and helping mature enterprises address regulatory challenges.
Previously, Fiona gained hands-on experience building legal frameworks from scratch. She advised unicorn companies on global expansion and regulatory hurdles, developing deep insight into clients’ growth challenges. Combining legal expertise with commercial judgment, she helps clients establish sustainable legal processes and provides clear guidance to advance their business.
Email: fiona.xu@consultils.com | Phone: 626-344-8949
Cathy Zhang focuses her practice on corporate and business transactions, with extensive experience in mergers and acquisitions, financing, corporate governance, and real estate transactions. Combining legal insight with business acumen, she provides practical, strategic counsel to help clients navigate complex transactions and achieve their business objectives.
Before joining ILS, Cathy worked at a boutique law firm in Los Angeles, handling a broad range of corporate and transactional matters, including business restructurings, mergers and acquisitions, financing, and real estate transactions. She is admitted to practice law in both California and New York.
Email: cathy.zhang@consultils.com | Phone: 626-344-8949
Hongmei Hu focuses on corporate and business transactions, including venture capital, mergers and acquisitions, startup financing, and capital markets. She advises founders, investors, and growing companies throughout their business lifecycle, bringing a cross-border perspective to transactions involving the U.S. and Asian markets.
Before joining ILS, Hongmei gained corporate and transactional experience at leading international law firms, working on Fortune 500 securities filings, SPAC and De-SPAC transactions, cross-border M&A, and data compliance matters. She graduated magna cum laude, served as an Associate Editor of the University of Illinois Law Review, and was named a 2024 American College of Bankruptcy Scholar.
Email: hongmei.hu@consultils.com | Phone: 626-344-8949
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