In October, backgroundchecks.com reviewed Newark, New Jersey’s new “ban-the-box” ordinance, which becomes effective November 18, 2012. At that time, we provided some of the details that employers need to comply with when conducting criminal background checks or when considering an applicant’s or employee’s criminal history. The ordinance places restrictions on employers with five or more employees who use criminal background checks on prospective new hires, and requires employers to modify their background check processes. You can access a copy of our review at: http://www.backgroundbiz.com/compliance/complianceupdate_10262012.html
A specific question was asked about whether the ordinance applied to independent insurance agents or insurance producers. That is, whether an employer, when contracting with independent agents or producers, is subject to the law’s restrictions and requirements pertaining to conducting criminal record checks and considering criminal history in the hiring and employment processes. We look at the law again in an attempt to find answers.
The law does not explicitly refer to independent agents or any other kinds of contractors. Further, the law does not define “employee,” but it does define “employment” as “any occupation, vocation, job, work, or employment with or without pay, including temporary or seasonal work, contracted work, or contingent work, and work through the services of a temporary or other employment agency, or any form of vocational or educational training with or without pay,” if the physical location of the employment is in whole or in part with the City of Newark.
One argument is that independent agents and other contractors are subject to the law because the definition of employment includes the words “any occupation, vocation, job, work or employment” and “contracted work.” Also, Section III of the ordinance introduces each substantive prohibition with the words, “In connection with any decision regarding employment”, thereby including all professions because it uses the defined term “employment.”
On the flip side, the other argument is independent agents and other contractors are (at least partially) not subject to the law because Section III often applies its substantive prohibitions to “candidates,” who are defined as potential employees, and the term “employee” is not defined. Because these prohibitions do not use the defined term “employment,” the ordinance is ambiguous, leaving the door open for interpretation.
So, the short answer to the question is we are unsure. The first argument is probably stronger, in which case the ordinance would apply to independent agents and contractors, but we cannot be sure until either the Newark City Council or a court’s decision provides clarification.
A copy of the ordinance is available at: http://www.employmentlawalert.com/uploads/file/12-1630(1).pdf
If you have any other questions, please contact client services and we will be happy to address them.