The 1964 Civil Rights Act codified some of the most significant anti-discrimination practices communities had been organizing to enforce across the United States for nearly two centuries. While the act does not explicitly prohibit discrimination on the basis of having a criminal record, it does prevent employment discrimination if the way criminal records are used inherently discriminates against individuals on the basis of race, gender, or other protected identities.
Since the Act, many state laws have followed suit to more explicitly protect individuals with legal system history, and some businesses have integrated second chance hiring practices into company policy. The United States has the highest incarceration rate of all countries in the world -- nearly twice as high as the next country in this ranking. This is one factor impacting the employment potential of over 70 million Americans with legal system history that will show up on a background check; companies that have dared to challenge criminal record stigmas in their hiring choices have benefitted dramatically. These are three second-chance employers worth highlighting.
An edgy company with products in 40 countries around the globe, Propaganda sells over 1 million units of e-liquid vape products every year. Among its business decisions, the company employs young people and practices second chance hiring. Propaganda began as a small business but has seen exponential development to international product placements and placements in over 5,000 American stores.
Propaganda co-founder Nicholas Bull believes individuals with legal system or addiction history deserve dignified, substantive, and fair employment...and the company has clearly seen the benefits of opting for more inclusive, equitable practices. Bull says people with legal records and “[people] just out of rehab are not only worthy of employment, but they can also benefit the whole community with increased productivity and even safety.”
Based in Cincinnati, Ohio, Nehemiah Manufacturing assembles and ships products for popular American brands ranging from Tide to Febreeze to Downy. The business proudly markets itself as an inclusive employment company, boasting nearly 180 jobs created in the state. About 80% of those jobs are second chance hires.
The company seems to go out of its way to practice equitable employment, offering a free car program to its employees to ensure they have a way to get to work, ensuring on-site social services, and, in some cases, providing housing.
Well before the pandemic, analysts projected 1 in 3 employees across various industries would turnover in 2020, and employment retention issues have only accelerated. This is incredibly costly to companies, but Nehemiah Manufacturing has an average 5.5 year employee retention rate. Company leadership believes their approach to hiring strengthens both the business and society more broadly.
Inventor and entrepreneur Pete Leonard has gone further than some to break the stigma: his Illinois-based company, I Have a Bean, deliberately hires people with felony convictions, and he only roasts coffee beans from the top 1% of global coffee quality. The company strives for an inclusive culture -- not only inclusive hiring -- and they prioritize team advancement and job skills throughout the employee relationship.
Leonard says his goal is to create such a high quality product and process that other companies will shift their own hiring practices -- the cornerstone of that combination is a commitment to second chances: “A prison record only proves that a person has made a mistake at some point in the past. None of us want to be judged by the worst thing we’ve done. Rather we want to be known as people for the way we live now. The ‘present evidence’ of the content of our character.” His approach has made I Have a Bean a reputable small business powered by an equally strong team.
Entrepreneurship is one of the most powerful places in society where possibilities can be dreamed and worked into reality: nowhere is that truer than in equitable, inclusive hiring. However, not all second chance hiring practices are created equal.
Some companies practice second chance hiring as a way to net cheaper labor and exploitatively steal wages while still branding themselves as a socially responsible corporation. This is partly because businesses can offer unlivable wages that are still drastically higher than wages formerly incarcerated people would make in prison and better than simply being unemployed altogether. It looks good for the company, and it offers people with legal system history something marginally better than their other options.
In what amounts to slave labor, incarcerated people make an average maximum daily wage of about $3.45, which is down nearly $1.30 from 2001, according to the Prison Policy Initiative. Additionally, formerly incarcerated people face unemployment rates of nearly 30%. Sociologist Lucius Couloute and data editor Dan Kopf reported these rates are higher than any other unemployment rates in the United States throughout all U.S. history, including the Great Depression. They say this harms everyone, including companies:
“Our estimate of the unemployment rate establishes that formerly incarcerated people want to work, but face structural barriers to securing employment, particularly within the period immediately following release. For those who are Black or Hispanic — especially women — status as “formerly incarcerated” reduces their employment chances even more. This perpetual labor market punishment creates a counterproductive system of release and poverty, hurting everyone involved: employers, the taxpayers, and certainly formerly incarcerated people looking to break the cycle.”
When businesses prey on these dynamics, they not only counteract the whole ethical and legal purpose of the Civil Rights Act, but they damage true, long-term business potential and community relationships in the process.
Second chance hiring is meant to focus on broadening truly equitable, liveable employment opportunities for people with a variety of backgrounds - from incarceration to rehabilitation. Companies have -- and will continue to -- benefit from second chance hiring that ensures transparency and fair wages. These kinds of companies should use a background check process that humanizes candidates to offer a holistic picture of their qualifications, not just blanket red flags.
The objective of second chance hiring is to ensure equal footing and fair pay so individuals with these systemic experiences are not automatically eliminated from consideration and so that companies don’t miss out on great candidates. The majority of companies who practice transparent, ethical, and equitable second chance hiring have already benefited from this shift, and companies who are new to this approach will inevitably strengthen their communities, teams, and brands by integrating it into their employment policies.