San Francisco Amends City’s Fair Chance Ordinance

Employers located in or doing business in San Francisco should familiarize themselves with recent amendments to City’s Fair Chance Ordinance (“SF FCO”).  These amendments took effect on August 10, 2026, and create additional restrictions and obligations for covered employers when considering employee or applicant criminal history.

SF Fair Chance Act Refresher

San Francisco’s FCO covers employers located or doing business in San Francisco with 5 or more employees, regardless of location, and applies to employment involving at least 8 hours a week within the City.

The SF FCO prohibits criminal history inquiries prior to a conditional offer of employment.  Employers may not inquire about or consider the following types of criminal history information at any time:

• An arrest not leading to a conviction, except for unresolved arrests
• Participation in a diversion or deferral of judgment program
• A conviction that has been dismissed, expunged, otherwise invalidated, or inoperative
• A conviction in the juvenile justice system
• An offense other than a felony or misdemeanor, such as an infraction
• A conviction that is more than 7 years old (unless the position being considered supervises minors or dependent adults)
• A conviction for decriminalized conduct, including the non-commercial use and cultivation of cannabis

When considering criminal history, an employer must conduct an individualized assessment. This assessment cannot include criminal history that is not directly related to the person’s ability to perform the necessary duties or responsibilities of the job.

If contemplating an adverse employment action, employers must first provide the applicant or employee with notice of the preliminary decision, including a copy of the report, which items are the basis of the preliminary decision, and the opportunity to respond with evidence of inaccuracy, rehabilitation, or other mitigating factors.

If the applicant or employee notifies the employer within 7 days of this type of evidence, the employer must delay the adverse action for a reasonable period of time, reconsider the adverse action in light of the information and notify the applicant or employee of the final decision.

Specific language on job advertisements, a workplace posting and annual reporting to the City are also required.

The Amendments

Effective August 10, 2026, the SF FCO places additional limitations on the type of criminal history employers may use as well as additional requirements for the individualized assessment process. The amendments also increase both administrative penalties for violations and liquidated damages available in a lawsuit.

Additional Types of Criminal History That Cannot Be Considered

As of August 10, 2026, employers may not use out-of-state criminal convictions or arrests for conduct that is lawful in California and related to the following:

• abortion-related healthcare
• drag performances
• gender-affirming care
• spontaneous abortion

Withdrawal of Preliminary Adverse Action Decision Required in Some Circumstances

The amendments also require that the employer withdraw the preliminary adverse action if the applicant or employee makes a reasonable factual showing that the preliminary adverse action is based solely on criminal history that is not directly related to the job.

Changes to Adverse Action Process

When an applicant or employee responds timely to a preliminary notice of adverse action, the SF FCO now requires the employer to acknowledge the response within 14 days. Also, employers now must notify the employee or applicant of the employer’s final decision within 30 days of the employee’s notice to the employer of evidence of inaccuracy, rehabilitation, or other mitigating factors (or within 30 days of the employer’s original notice of the preliminary decision if the employee does not respond to the preliminary notice).

Employers covered by the SF FCO should review their hiring practices, notices, and forms to ensure compliance with these new amendments. The San Francisco Office of Labor Standards Enforcement provides detailed information about the SF FCO and other City ordinances.

Have Questions? CEA members can call us at 800.399.5331, or email us at CEAinfo@employers.org.