Iowa Supreme Court Upholds Portion of Waterloo IA “Ban the Box” Ordinance

Ban the Box

Written By ESR News Blog Editor Thomas Ahearn

On June 18, 2021, the Iowa Supreme Court upheld a portion of a “Ban the Box” ordinance known as the “Fair Chance Initiative” passed in Waterloo, Iowa, that restricts when employers may inquire about the criminal history of job applicants but struck down restrictions on what types of information may lead to adverse action.

“For the reasons discussed herein in more detail, we conclude that the ordinance is preempted to the extent it purports to regulate whether an employer can consider an employee’s criminal history at all—i.e., to the extent it regulates a term and condition of employment,” read the opinion from the Iowa Supreme Court.

“However, it is not preempted where it only regulates timing, because that is not a term or condition of employment. Accordingly, we affirm in part, reverse in part, and remand for further proceedings,” explained the opinion of the court delivered by Edward M. Mansfield, a Justice of the Iowa Supreme Court.

In October 2019, the City of Waterloo approved the state’s first “Ban the Box” ordinance that made it illegal for any employer to ask about an applicant’s criminal history on a job application. Effective July 1, 2020, all private employers with at least 15 employees in Waterloo, Iowa were subject to the “Ban the Box” ordinance that:

  • Mandated that covered employers wait until after a conditional offer of employment to inquire about and consider a candidate’s criminal history;
  • Prohibited employers from considering certain types of criminal records, including arrests and pending cases; and
  • Prohibited employers from rejecting a candidate with a criminal record absent a “legitimate business reason” as defined in the ordinance.

In January 2020, the Iowa Association of Business and Industry (ABI) filed a lawsuit against the City of Waterloo and the Waterloo Commission on Human Rights that claimed the “Ban the Box” ordinance violated the Iowa Code. The lawsuit ended up in the Iowa Supreme Court, which issued a ruling on the ordinance’s legality.

The ABI lawsuit argued that Waterloo’s “Ban the Box” ordinance was more strict than the Iowa Civil Rights Act (ICRA) as to hiring practices and other terms or conditions of employment, and therefore cities were prohibited from enacting such ordinances under Iowa Code § 364.3(12)(a), which stated the following:

  • A city shall not adopt, enforce, or otherwise administer an ordinance, motion, resolution, or amendment providing for any terms or conditions of employment that exceed or conflict with the requirements of federal or state law relating to a minimum or living wage rate, any form of employment leave, hiring practices, employment benefits, scheduling practices, or other terms or conditions of employment.

The Iowa Supreme Court partly agreed with the IBA and held that the Iowa Code preempted the “Ban the Box” ordinance to the extent it purports to regulate whether an employer can consider an employee’s criminal history but found the ordinance not preempted to the extent it only regulated the timing of any criminal history inquiry.

The decision does not change the ordinance’s requirement that employers wait until after a conditional offer to inquire about a candidate’s criminal history. However, the decision does mean Waterloo, Iowa employers are no longer subject to a higher standard when determining whether to reject a candidate with a criminal record.

As of July 2021, 36 states and more than 150 cities and counties have Ban the Box laws, according to the National Employment Law Project (NELP). Major cities that have passed Ban the Box laws include Austin, Baltimore, Buffalo, Chicago, Los Angeles, New York City, Philadelphia, San Francisco, Seattle, and St. Louis.

“Ban the Box” laws and Second Chance Programs that help ex-offenders in the United States – an estimated 70 million people – find work will continue to evolve, according to leading global background check firm Employment Screening Resources® (ESR), which compiled the “ESR Top Ten Background Check Trends” for 2021.

Employment Screening Resources® (ESR) – which was named the #1 screening firm in 2020 by HRO Today – offers a white paper on “Ten Critical Steps for Ex-Offenders to Get Back into the Workforce,” an “ESR Ban the Box Resource Guide,” and a Ban the Box Resource Page. To learn more about ESR, visit www.esrcheck.com.

NOTE: Employment Screening Resources® (ESR) does not provide or offer legal services or legal advice of any kind or nature. Any information on this website is for educational purposes only.

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