Why Would Anyone Start a Business in San Francisco?

Via Protein Wisdom:

A legislative proposal in San Francisco seeks to make ex-cons and felons a protected class, along with existing categories of residents like African-Americans, people with disabilities and pregnant women. If passed by city supervisors, landlords and employers would be prohibited from asking applicants about their criminal past. [...]According to The City’s Human Rights Commission, San Francisco has the highest recidivism rate of any big city in California, almost 80 percent. With an influx of new prisoners set to be released because of the state’s budget crisis, supporters argue felons need legal protections before they’re disqualified simply because of their record, which could be decades old and for crimes that have nothing to do with the job they’re hoping to get.

Do you really want to open your customer contact business in a location where you cannot background check employees, or are not legally allowed to fire them if you find some horrible criminal history?  Can you imagine the lawsuits flying?  And don't tell me that the company would be safe in a courtroom arguing that it was illegal to check.  I could easily see a California jury holding a company liable for not background checking an employee for an incident even when it was illegal to do so.



  1. Bill M:

    Something like has happened.

    Company A fired an employee for threatening other employees with a gun and then lost a suit brought by the former employee when they told a prospective employer why they fired them.

    Company B had a similar employee but didn't divulge why they fired them to the prospective employer, company C. The violent employee then killed several employees after being hired by company C. Company C successfully sued company B for failing to disclose the dangerous behavior of the former employee.

  2. Nascar Wife:

    What about jobs convicted felons are disqualified from holding like teachers, school workers, police, corrections officers, gun store clerk? I think this proposal conflicts with a lot of existing laws, at both the state and federal level, that prohibit convicts from working in certain professions.

  3. Mark:

    Apparently it also applies to apartment rental. If you rent out a home or apartment in SF you can no longer ask about the criminal history. Scary

  4. ElamBend:

    I live in Chicago. I used to live in San Francisco. Illinois has some major (major) problems; but as I was explaining to an acquaintance the other evening, she cannot not imagine the shear weight of the state upon all aspects of commerce that occurs in California. That state is insane in an almost dystopian way. In a generation it will look like a third world country; home to the super rich and the super-dependent/poor.

    It's a shame.

  5. perlhaqr:


  6. chuck martel:

    This "criminal background check" and the subsequent inability of felons to get employment means that they're doomed to a life of crime, homelessness or the most undesirable and lowest paid jobs. If the state can assist or enforce a permanent ban on the kinds of employment that a convicted felon can obtain an additional lifetime punishment is being tacked on to their initial one, that supposedly "paid their debt to society". Logically, every criminal committed a "first" crime. Before they did so, they had no criminal background and their relationship with society was hunky-dory. But, once convicted, they are "criminals" for life, despite the fact that there are perhaps millions of other criminals who either haven't got around to committing a crime yet or simply haven't been caught. The US legal-judicial system, which incarcerates more individuals than any country ever has in world history, will eventually face the same condemnation that the Salem witch trials, the pre-school molestation cases and Duke lacrosse players created and it can't come soon enough. The cops, prosecutors, judges and legislators that implement this ongoing tragedy belong in a special prison of their own.

  7. steve:

    Its not soo bad if you have connections. They are working their way to a completely mercantalist system as opposed to a socialist one I think. Still not so good if you want to live free.

  8. LoneSnark:

    I think we have found something the regulatory state can do for us. A law granting blanket immunity to employers providing job references provided they can prove their statements are true.

  9. marco73:

    No one is thinking like a politician. Nascar Wife is on the right track, though. If you are a business owner in San Francisco, you can create large barriers to entry with stupid laws just like this. Your business just needs to be exempt.
    Its really pretty simple: let the city install all kinds of crazy laws. Then just ask your local politico for an exemption. It may cost you a few thousand annually in political contributions, but look at the benefits. No one in their right minds would open or expand a business in San Francisco if they had to comply with all the regulations. But if you can pay off a politician, its almost like creating your own monopoly.
    Don't believe me? Just look at the businesses that have gotten waivers for Obamacare: its a who's who of campaign contributors to Congresswoman Nancy Pelosi of San Francicso. This link even has a spokesman commenting that he is shocked, shocked, that anyone would believe politics was behind the waivers:

  10. ElamBend:

    @chuck martel:
    I'm very sympathetic to what you are saying. There is a case to be made that we have gone way too far down a road where so much is criminalized and so much so at the 'felony' level that more and more people will get swept up in it. I know people who are convicted of felonies (both deservedly and via over-written state criminal laws); and it makes life incredibly difficult, no matter what the crime was.
    That being said, businesses are sued and held liable all the time for who they hire and absent a blanket immunity they've got a pig in a poke. Past that, if I'm hiring a book keeper; I'd want to know if that person was convicted of embezzlement.

    Every time the state tries to put a thumb on the scale, it ends up mashing down with the whole hand.

  11. Mark:


    Your hypothesis could be true. People are less likely to hire a felon. But a smart business person would evaluate the risks and appropriateness. Esp if he/she can get good labor at a lower rate.

    For instance, if I want to hire you as the company accountant and your felony is that you got into a bar brawl, I would probably overlook the felony. If your felony is for misappropriation of funds, maybe hiring you as the accountant - even after "paying debt to society" - it might not be a good idea.

    For non-violent crimes, such as drug sales, or embezzlement, many of these guys think they would not have gotten caught if they had done it right - and next time they will just do it right.

    Interestingly one of my first jobs, my boss was still in jail! This was in a town 25 miles south of San Francisco. He was on some work release program and had to be back in the jail @ 10 pm. And yes, he would talk about just "doing it right" the next time.

  12. Dan:

    Business environment aside, would you want to raise kids in a state that has mandated GBLT history be taught in schools?

  13. Slocum:

    Brilliant. Another potential reason never to hire somebody with a period of unemployment on his resume (after all, it *could* be due to a prison sentence, but you can't ask to find out).

  14. smurfy:

    Great, now S.F. politicians don't need to worry about losing their job and home if they are indicted.

  15. Rick C:

    Lately I've been seeing (a ridiculous number of) ads on TV for companies that will do background checks. Never mind the fact that I want to smack the spokepeople ("nobody's coming into MY neighborhood without a background check!"), all that will happen is business will use companies like this and then not divulge their reasons for not hiring criminals; what will happen is that no reason will be given at all, just "we've decided to go with someone else" to try to leave no purchase for suits.

  16. Craig:

    They can just put "laundry worker" on their resume for that period.