July 2026
Message from the Editor:
Welcome to another edition of ‘Inside Background Screening’ our new newsletter. Our goal is to bring to you cutting edge news and information about what is happening in the background screening world to help keep you informed and to position you to make the best possible hiring decisions.
We hope you enjoy ‘Inside Background Screening’ and that you will share your interest and thoughts with us.
Lorenzo
Lorenzo Pugliano
CEO
Lpugliano@nsshire.com
EMPLOYMENT SCREENING
Washington Employers: Prepare for Hiring Practice Shifts as New Background Check Requirements Take Effect in 2026 + 2027
Washington State’s expanded Fair Chance Act will impose stricter limits on employer use of criminal background checks beginning in 2026 and 2027. Employers generally will be prohibited from requesting criminal history information until after making a conditional job offer and must conduct individualized assessments before denying employment based on convictions. The law also bans reliance on arrest records and automatic disqualifiers in most cases, increases notice requirements, and authorizes stronger enforcement and penalties for noncompliance.
Virginia Mandates Pay Transparency and Bans Pay History Inquiries Starting July 1
Virginia has enacted a new pay transparency and salary history law that takes effect July 1, 2026. The law requires employers to disclose wage or salary ranges in job postings for jobs, promotions, transfers, and other opportunities, and those ranges must be set in “good faith.” It also bans employers from asking applicants about past salary history or relying on it in hiring or pay decisions. The law includes anti-retaliation protections and allows enforcement through state action and private lawsuits.
California DOJ is Still Processing 85,000 Unreported LA County Criminal Convictions
The U.S. Department of Justice is continuing to process thousands of previously unreported Los Angeles County criminal convictions after discovering a decades-long court reporting failure. The backlog includes roughly 464,000 case dispositions dating from the 1960s through 2023 that were never transmitted to California’s criminal records database. As records are updated, affected individuals may face employment, licensing, housing, and firearm eligibility consequences, while agencies work to correct incomplete background check information.
Philadelphia Releases Initial Guidance on Fair Chance Hiring Amendments
Philadelphia has released its first official guidance on amendments to the city’s Fair Criminal Record Screening Standards Ordinance (Fair Chance Hiring law), offering employers insight into how regulators expect the rules to be applied. The guidance emphasizes individualized assessments of applicants’ criminal histories, stricter limits on what convictions can be considered, and enhanced notice and anti-retaliation requirements. Employers must also provide clearer explanations and allow applicants time to respond before adverse hiring decisions. The guidance helps clarify compliance expectations but leaves several implementation details unresolved.
Inside The ‘Clean Slate’ Record-Sealing Movement Growing in Both Red and Blue States
A report on the “Clean Slate” reform movement explains how states across the U.S. are increasingly adopting automatic record-sealing laws to help people with old arrest or conviction records move forward. The movement aims to reduce barriers to jobs, housing, and education by clearing eligible records without requiring individuals to navigate complex petition systems. Supporters say this shift promotes fairness, economic mobility, and public safety by improving reintegration. The report also highlights growing bipartisan momentum, with multiple states advancing legislation and expanding eligibility for automatic expungement.
Four Fearless Employment Law Predictions for 2026
Connecticut employment law experts predict significant developments for 2026 affecting multi-state employers. Key emerging issues include heightened enforcement of fair hiring practices, increased scrutiny of AI in hiring decisions, and evolving data protection requirements. Employers should anticipate stricter compliance obligations regarding background screening, criminal history consideration, and employment verification. Proactive compliance measures, including regular policy audits and staff training, are essential to navigate the increasingly complex employment law landscape.
LEGAL ISSUES
New Jersey Appellate Division Rules Employees and Job Applicants Can Sue Employers Under CREAMMA for Cannabis-Related Hiring Discrimination
The New Jersey Appellate Division held that private social media posts can be discoverable in litigation when they are relevant to the claims at issue. In Davis v. Disability Rights New Jersey, a former employee alleging wrongful termination and emotional distress was ordered to produce private social media content and certain cell phone records. The court found that privacy interests do not automatically shield relevant evidence and emphasized New Jersey’s broad discovery rules, while noting that requests should remain narrowly tailored and relevant.
Illinois Bill Could Reshape Disparate Impact Challenges to Hiring
An Illinois bill could reshape disparate impact claims in hiring by expanding liability for practices that disproportionately affect protected groups unless they are job-related and necessary for business. It explicitly covers tools like criminal background checks, AI hiring systems, and other assessment methods. Employers may also need to prove that no less discriminatory alternatives exist, increasing compliance burdens and legal risk for modern hiring and screening practices.
FAIR & SECOND CHANCE
California May Be Redefining How Employers Use Criminal History
A proposed California measure could significantly change how employers use criminal history in hiring decisions. Building on the state’s existing “ban-the-box” law, it would further limit when and how criminal records can be considered and may classify criminal history as a protected characteristic. Employers would need to show a direct link between a conviction and job duties, document individualized assessments, and provide applicants with a chance to respond before denial. Supporters say it promotes fairness, while critics warn of added compliance burdens.
Maine Governor Vetoes Clean Slate Bill
Maine Governor Janet Mills vetoed a bipartisan “Clean Slate” bill that would have automatically sealed many misdemeanor convictions after five crime-free years. Mills cited concerns about domestic violence cases, court administration costs, transparency, and constitutional issues. Supporters argued the bill would improve access to jobs and housing for more than 100,000 residents with records. Legislative efforts to override the veto failed, though advocates pledged to reintroduce the proposal in a future session.
Rhode Island Proposes Clean Slate Law and Automatic Expungement
Rhode Island lawmakers introduced the Rhode Island Clean Slate Act, legislation that would automate expungement for eligible criminal records and potentially help about 77,000 residents clear past convictions. Currently, individuals must petition courts for expungement, but the proposed law would shift the process to automatic electronic sealing handled by state agencies and the judiciary. Supporters say the measure would improve access to jobs, housing, and economic opportunities while modernizing record-clearing processes already adopted in several other states.
CANDIDATE FRAUD
Nurse Who Sold 2,600 Fake Diplomas Pleads Guilty Mid-Trial, Faces Prison Term
A Florida nurse involved in the nationwide “Operation Nightingale” nursing diploma mill scheme pleaded guilty to fraud-related charges connected to the sale and use of fraudulent nursing credentials. The case centered on fake diplomas and transcripts issued by Florida nursing schools, allowing unqualified individuals to sit for licensing exams and obtain nursing jobs without completing required coursework or clinical training. Federal prosecutors have secured numerous convictions in the scheme, which produced thousands of fraudulent credentials and raised significant concerns about patient safety and healthcare workforce integrity.
Air Canada Pilot Flew Passengers for Years with a Fake Pilot’s License
A former Air Canada pilot has been arrested and charged with fraud after allegedly flying 900 passenger flights for 17 years without holding the required Airline Transport Pilot License. Authorities say he had a commercial license but lacked the higher certification needed to act as captain on large aircraft. The issue was discovered during a credential review, prompting a wider investigation. Air Canada removed him from duty and reported the case to regulators, stating passenger safety was not compromised.
IMMIGRATION STATUS & EVERIFY
White House Aims for Backdoor E-Verify Expansion in Grants Rule
The White House has proposed requiring all federal grant recipients to use E-Verify, significantly expanding the employment eligibility verification system. The rule would affect many organizations that receive federal funding and could extend obligations to some subrecipients. Supporters argue it would help prevent unauthorized employment, while critics say it would increase administrative burdens and compliance costs. If adopted, the measure would broaden immigration-related hiring requirements and strengthen federal oversight of employers receiving grants.
E-Verify Project: Requirement Eliminated for Small Businesses, But Maintains New Audits and Fines for Employers
A North Carolina bill would expand E-Verify requirements to businesses with as few as five employees, down from the current threshold of 25. While the proposal removes broader mandates for some smaller employers compared with earlier versions, it retains stronger enforcement measures, including random audits, investigations, and increased fines for noncompliance. The legislation would also require reporting suspected unauthorized workers to federal authorities and provide protections for employees who report E-Verify violations.
DATA PROTECTION & PRIVACY
New Jersey’s Proposed Data Privacy Regulations Have Expired
New Jersey lawmakers are considering comprehensive privacy legislation that would expand consumer rights and impose new obligations on businesses that collect and process personal data. The proposed law would grant residents rights to access, correct, delete, and opt out of certain uses of their personal information, while requiring greater transparency and accountability from organizations. The article notes that the proposal reflects a broader national trend toward state-level privacy regulation and would add to the increasingly complex patchwork of U.S. data privacy compliance requirements.
Seventh Circuit Addresses Biometric Information Privacy Act (BIPA) Damage Accrual (US)
Many employers collect biometric data like retina or iris scans, voiceprints, hand scans, fingerprints, facial scans and DNA from their employees. In Illinois, the Illinois Biometric Information Privacy Act (BIPA) was enacted in 2008 to regulate and safeguard how private entities in Illinois handle biometric information and imposes notice and consent requirements for the collection and storage of such data. So if a covered employer mishandles an individual’s data, BIPA grants the individual a private right of action to sue the company. Importantly, the individual does not need to prove actual financial or physical harm to sue under BIPA.
BIOMETRICS & IDENTITY VERIFICATION
Maine: State Enacts Law Protecting Medical Cannabis Patients from Workplace Discrimination
Maine has enacted a new law protecting medical cannabis patients from workplace discrimination, reinforcing job-related safeguards for registered users. The measure limits employers from taking adverse action against employees or applicants solely based on their status as medical cannabis patients, while still allowing workplace drug-free policies and discipline for on-the-job impairment. Advocates say the law improves employment stability and access to care for patients with serious conditions, while maintaining employer authority to ensure workplace safety and compliance.
DRUG & ALCOHOL SCREENING
The Ultimate Guide to THC Testing and Impairment Testing
A guide explains the difference between THC testing and cannabis impairment testing. Traditional THC tests using urine, saliva, blood, or hair detect past cannabis use but cannot reliably determine whether a person is currently impaired. Because THC can remain in the body long after its effects wear off, positive results do not necessarily indicate impairment. The article argues that impairment testing, which measures real-time indicators such as reaction time, cognition, coordination, and eye movements, provides a fairer and more accurate assessment of a person’s current ability to work or drive safely.
Legal Update: No Safe Harbor: DOT Rejects State-Licensed Marijuana
The Department of Transportation maintains its position that state-licensed medical marijuana does not provide a safe harbor for positive drug test results in DOT-regulated positions. Employees cannot rely on medical marijuana cards, physician certifications, or state recommendations to override DOT drug testing policies. This guidance reinforces that safety-sensitive positions remain subject to strict federal drug testing requirements regardless of state-level marijuana legalization or medical authorization, requiring employers to maintain consistent enforcement.
Drug Testing Coming to White-Collar Jobs as Cocaine Use Booms
Workplace drug testing is expanding beyond traditionally safety-sensitive industries into white-collar professions as cocaine use rises in Australia. Employers are increasingly concerned about the effects of drug use on productivity, workplace safety, decision-making, and company reputation. Drug testing companies say they are detecting more cocaine use among corporate employees, reflecting broader social trends. Experts note that businesses are adopting stricter testing policies and education programs to manage risks associated with substance use in professional environments.
Disclaimer: All information presented is for information purposes only and is not intended to provide professional or legal advice regarding actions to take in any situation. Nationwide Screening Services makes no representations for any products or services that are mentioned and accepts no responsibility for any actions or consequences taken without the guidance of a licensed attorney or professional consultant.
We would love to hear from you. Email us at info@nsshire.com