By Matt Heldt
Washington employers will soon be subject to new, more burdensome rules under recent amendments to the Washington Fair Chance Act. Passed this legislative session, HB 1747 goes into effect on July 1, 2026 for employers with 15 or more employees, and on July 1, 2027 for all Washington employers regardless of size.
While employers have been subject to the Fair Chance Act since 2018, HB 1747 amends and expands the law in the following ways:
- Employers will be more limited when inquiring about an applicant’s criminal record. Employers cannot inquire, whether through the applicant directly, a background check, or other means, about an applicant’s criminal record until after making a conditional offer of employment. HB 1474 also prohibits employers from implementing a policy that automatically or categorically excludes individuals with a criminal record from any employment position; or from advertising for a position in a way that would prevent people with criminal records from applying, such as through a “no criminal background” requirement or similar messaging.
- Even after making a conditional job offer, employers will be highly regulated. Employers cannot reject an applicant for failing to disclose a criminal record prior to receiving a conditional job offer. Employers cannot impose tangible adverse employment actions, including discipline, demotion, or failure to hire, based on an individual’s arrest or juvenile conviction record, except an adult arrest in which the individual is out on bail or released on their own personal recognizance pending trial. And employers may only take tangible adverse employment action based on an individual’s adult conviction record if the employer has a legitimate business reason for doing so.
“Legitimate business reason” is defined to mean that, based on information known to the employer at the time of the decision, the employer believes in good faith that the nature of the underlying criminal conduct will either (1) negatively impact the individual’s fitness or ability to perform the position; or (2) harm or cause injury to people, property, business reputation, or business assets. - Employers must engage in a prescribed process before taking adverse action based on an individual’s criminal record. If an employer decides to take tangible adverse action against an employee or applicant because of the individual’s criminal record, the employer must (1) notify the individual, (2) identify the record on which the employer is relying for purposes of a legitimate business reason, and (3) hold the position open for at least two business days to give the individual a reasonable opportunity to correct or explain the record – or provide information on their rehabilitation, good conduct, work experience, education, and training.
After doing so, if the employer still decides to take adverse action, the employer must provide a written decision with specific documentation about its reasoning and an assessment of each of the relevant “legitimate business decision” factors, including the impact of the conviction on the position or business operations, and its consideration of the individual’s rehabilitation, good conduct, work experience, education, and training.
If, at any time before a conditional job offer, an applicant voluntarily discloses information about the applicant’s criminal record during an interview, the employer must immediately inform the applicant in writing of the Fair Chance Act requirements and provide a copy of the attorney general’s Fair Chance Act Guide for job applicants. - Penalties increase drastically. Under the current Fair Chance Act, penalties max out at $1,000 per violation. Post-amendment penalties begin at $1,500 and jump to $15,000 starting on the third violation and for every violation thereafter. The Washington Attorney General enforces the Act and may impose penalties for each aggrieved employee or job applicant, plus unpaid wages, attorneys’ fees, and costs.
While there are some limited exceptions for certain types of positions and employers, most Washington employers must comply beginning July 1, 2026.
What Employers Should Do Now
Before HB 1474 becomes effective, employers should audit their hiring practices and internal policies to ensure preparedness for these new requirements. Employers should also educate and train managerial employees – including any managers with the power to hire, fire, or discipline subordinate employees – to act in accordance with the new rules. Lastly, employers should consider preparing form notice and written decision documents to ensure thoroughness and consistency in decision making.
For more information about HB 1474, or guidance on handling criminal background inquiries in Washington or other states, please contact a member of our Labor & Employment team.
This update is prepared for the general information of our clients and friends. It should not be regarded as legal advice. If you have questions about the issues raised here, please contact any of the attorneys in our Labor & Employment Practice Group, or the attorney with whom you normally consult.
