Fasten Your Seatbelts: Legislatures Consider Unemployment Discrimination Statutes in a Down Economy
Employment Law Alert
Facing continuing high levels of unemployment, state and federal legislators are increasingly considering laws that prohibit discrimination based on the fact that a job applicant is unemployed. Although only one state, New Jersey, has currently adopted such a law, legislation which would prohibit discrimination against the unemployed has been recently proposed in Congress, the District of Columbia, and by the states of Connecticut, Florida, Illinois, New York and Michigan. Although those proposals have not (yet) passed, the California Legislature is now also considering similar legislation, Assembly Bill (AB) 1450.
While many of the proposed statutes would both prohibit discriminatory advertising and recruiting, and provide aggrieved individuals with the right to file a lawsuit, AB 1450 is currently modeled after the more limited New Jersey statute. Under the New Jersey statute, N. J. S. A. 34:8B-1, employers are generally prohibited from publishing any advertisement which states that: (1) the qualifications for a job include current employment; (2) the employer will not consider or review an application for employment submitted by any job applicant who is currently unemployed; or (3) the employer will only consider job applications from applicants who are currently employed. The New Jersey statute does not provide job applicants with a private right of action in court, but does empower the New Jersey Commissioner of Labor to impose fines ranging from $1,000 to $10,000 per violation.
AB 1450 would also generally prohibit employers with 15 or more employees from publishing advertising which excludes the unemployed, and would also make it unlawful for such employers to refuse to consider for employment or refuse to offer employment to an individual because he or she is (or was previously) unemployed, or to direct an employment agency to consider the fact that an applicant is (or was previously) unemployed. Significantly, the law would prohibit discrimination based on an applicant's present or past unemployment regardless of the length of time of the unemployment. The law would allow an exception where current employment is a bona fide occupational qualification — without describing when that might be — and would also allow an employer to advertise positions for which applicants are limited to its own current employees. Separate provisions would impose related obligations on employment agencies. As with the New Jersey statute, the California statute would allow the California Labor Commissioner to impose civil penalties ranging from $1,000 to $10,000 per violation and would not create a private right of action. (It is unclear, however, whether a court may determine that California employees might be able to seek penalties under California's Private Attorney General Act.)
Although AB 1450 is currently only a proposal, employers should continue to monitor efforts to prevent discrimination based on unemployment status, and should also take care when formulating advertisements for open positions. To the extent employers can convince legislators that consideration of unemployed job applicants is not a serious problem, they will retain flexibility in hiring. To the extent that more states (or the federal government) adopt broader laws prohibiting employers from considering a job applicant's employment status, recruiting techniques which are now routine (such as asking about gaps in an employee's job history or why the employee is currently unemployed) could support potential fines and litigation.