The Business Benefits of Being a Fair Chance Employer

From racial justice to LGBTQ+ inclusion, in the last several years, employers have begun to acknowledge the importance of fostering a work culture that is diverse and inclusive. As a result, many have formed DEI committees, or made commitments to hiring more diversely— both of which are great steps towards a more equitable workplace. But many employers overlook one key aspect of hiring diversely: fair chance hiring.

Fair chance hiring means giving individuals with prior convictions or arrests a fair chance in the hiring process. It isn’t a black-and-white approach, but rather a more equitable, measured way of evaluating candidates so as to discourage hiring discrimination. A fair chance hiring process means looking thoughtfully at your hiring and adjudication criteria, removing bias and being open to hearing the context and any remediation around a candidate's criminal background before making the final decision. It is one step organizations can take to become more equitable.

All types of diversity are important—including diversity of background. And while organizations are increasingly emphasizing the importance of diversity in their mission statements, few are actually keeping up with their public promises. A commitment to fair chance hiring means that because your hiring process is less exclusionary, you’ll end up with a broader range of applicants from different backgrounds. Diversity is an important component of inclusion and equity, but it’s also key to staying competitive. Diverse teams are more creative and today’s job candidates place a high importance on corporate diversity. 76% of survey respondents said that a diverse workforce was important to them when considering where to work.

According to the U.S. Equal Employment Opportunity Commission (EEOC), employers cannot discriminate using criminal history information. Exact policies vary from state to state, but federal law says that you can’t treat individuals with the same criminal record differently based on their protected status (including by race or gender). One way to assure compliance with the EEOC and federal anti-discrimination law is to use a fair chance hiring process, which removes opportunities for human bias and gives formerly incarcerated individuals the chance to be considered for a job they are qualified for. It allows the space for careful consideration of the context of their background before making a final hiring decision.

Business isn’t only about profit—it’s also about making a meaningful, positive impact for employees and the community. Fair chance hiring is a great way to increase your organization’s positive social impact, while also benefiting from the unique skill set of people from different backgrounds.

Formerly incarcerated individuals are at an increased risk for housing insecurity, homelessness, poverty, and unemployment. With full-time work, these individuals are better able to financially provide for themselves and their families. But unemployment among system-impacted people is as high as 27%, and there are also race and gender barriers that affect a person’s ability to find employment.

Individuals with prior convictions need a feasible path to gainful employment, not only to break cycles of poverty and homelessness, but also to help them continue on their path to rehabilitation. Studies have shown that employment is one of the best protective factors against recidivism.

It’s worth noting as well that candidates are increasingly valuing social impact when it comes to deciding where to work. As companies struggle to hire candidates during what some have termed “The Great Resignation”, it’s important to remember that today’s employees want to work for a company whose values they believe in.

In today’s hyper-competitive job market, when 95% of employees are considering quitting and employers simply can’t find candidates to fill their open jobs, hiring teams need every advantage they can get to hire and retain great talent. If you’re turning away qualified candidates by asking about conviction or arrest records in the first stage of the job application process, you’re losing money and making each successful hire more expensive. Revising your process to fit the fair chance model can help you find qualified, interested candidates for your open jobs.

Studies have also shown that formerly incarcerated people leave their jobs at lower rates than their peers. Lower turnover rates save money and help foster a happier, more stable work culture.

Much of the discrimination against system-impacted individuals seeking employment is based on misguided or inaccurate ideas about their job performance. In reality, large employers have had proven success with hiring formerly incarcerated individuals. In the United States military, for example, previously incarcerated individuals were actually promoted quicker and to higher ranks than their peers. Many formerly incarcerated people are qualified but struggle to reenter the workforce upon release because of administrative barriers or state laws preventing them from holding professional licenses.

While racial justice protests in 2020 prompted many companies to issue commitments to promoting racial equality and anti-racism, there is still much work to be done to follow through on those promises. The fact is, racism is a huge issue in our criminal justice system, so we simply can’t talk about the importance of fair chance hiring without mentioning how the justice system is stacked against people of color. Black people are at least five times as likely to be imprisoned as white people. Whether it’s implicit racial bias, structural racism, or effects of historically racist policies, people of color face racial disparities in every facet of the justice system. Instituting a fair chance hiring policy is one way your organization can fight racism.

77 million people in the United States have some sort of criminal record. Incarceration-related unemployment is behind many of our urgent social issues including poverty, homelessness, and mental health. With fair chance hiring practices, employers can fight for positive social change.

If you’re interested in learning more about how your organization can implement fair chance hiring, download our guide: How to Become a Fair Chance Employer.