Excerpted from a Forbes article by Alonzo Martinez
Employers entered 2025 facing one of the most dynamic and fast-moving compliance landscapes in recent memory. In the first quarter alone, lawmakers across the country advanced new rules affecting background screening, drug testing, pay equity, and the use of artificial intelligence in hiring.
Organizations that conduct background checks must pay close attention to these changes. The compliance landscape is evolving quickly, and staying ahead will require updates to policies, procedures, and platforms. These early developments already carry significant implications for employers’ hiring and risk management strategies.
Criminal History Reform: Clean Slate Laws and Fair Chance Hiring
Several states implemented or expanded clean slate laws this year, allowing certain criminal records to be sealed or expunged after an individual remains crime-free for a set period. Some laws provide automatic relief, while others require a petition to the court. The goal is to improve access to employment and reduce the stigma associated with a criminal record.
Minnesota’s clean slate law became effective on January 1. It authorizes the automatic expungement of specific non-violent misdemeanors and some felonies after up to eight years. Although the law is now in effect, the state will not begin sealing records until mid-May due to technical delays.
Colorado continues implementing its law, which allows for the automatic sealing of civil infractions after four years, misdemeanors after seven, and eligible felonies after ten. Employers should expect older records to phase out of background checks as the state updates its eligibility lists.
Washington, D.C. passed the Second Chance Amendment Act, which will begin automatically expunging marijuana possession and other decriminalized offenses in January 2026. Other records, such as dismissed charges and certain misdemeanors, will be eligible for sealing on a petition basis or after a waiting period.
Portions of Virginia’s clean slate law will not take effect until July 1, 2026, unless the state completes technical upgrades sooner. The law covers many misdemeanor convictions and expands eligibility to include some previously overlooked offenses.
At the same time, states like California, New York, and Texas have introduced legislation to expand record relief options. Employers should prepare for the continued erosion of access to certain criminal history data.
Ban-the-Box, Fair Chance, and Criminal History Protections
Kansas City, Missouri, adopted an ordinance earlier this year that recognizes criminal history status as a protected class. The ordinance applies to city agencies and contractors, but it also updates civil rights protections for private employers. Although the law does not specifically require individualized assessments from private companies, the shift in language suggests the city may move in that direction. Employers in Kansas City should consider adopting individualized assessments as a best practice.
Several states are actively considering ban-the-box laws or amendments to existing laws. These include proposals in Alabama, Kentucky, New York, Oregon, South Carolina, Texas, and Washington. In many states, bipartisan support for second-chance policies signals a national trend that employers cannot ignore.
Pay Transparency and Pay Data Reporting
Pay transparency laws continue to expand across the country. Illinois, Minnesota, and Vermont now require employers to disclose salary ranges in job postings. New Jersey’s law takes effect on June 1, and Massachusetts will begin enforcement on July 31.
Cannabis Legalization and Testing Policies
Kentucky launched its medical cannabis program on January 1. The law does not require employers to accommodate medical marijuana use. Employers may continue to enforce drug-free workplace policies and discipline employees for violations. The law also does not protect employees from termination based on medical marijuana use.
Across the country, employers must navigate a patchwork of marijuana laws. Some states prohibit pre-employment testing for THC or require employers to assess impairment rather than relying on test results. Employers in California, Minnesota, New York, Washington, Philadelphia, and Pittsburgh must revise their drug testing policies to reflect these limitations.
Artificial Intelligence and Employment Decisions
At the federal level, the Trump administration rescinded the Biden-era executive order that prioritized responsible AI use in employment. The new administration has taken a deregulatory approach, focusing on rapid innovation and global competitiveness. Although federal oversight has loosened, civil rights laws still apply.
I-9 and E-Verify Updates
The new Form I-9, dated January 20, 2025, is now in effect. Employers may continue using earlier editions through May 31, 2027, but they must update their systems to reflect the correct expiration date by July 31, 2026.
E-Verify has also updated its terminology to match the new I-9 form. Employers must now select the updated status “an alien authorized to work” instead of the previous “noncitizen authorized to work.” These updates apply across E-Verify, E-Verify+, and Web Services.
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