Can we fire an employee who was arrested and is in jail?

Employers need to proceed carefully before taking any adverse action against employees who have been arrested while off duty for crimes that are unrelated to their jobs. The main reason for caution is that California prohibits termination and other adverse actions based on an employee’s arrest.

Labor Code Section 432.7(a) provides that no employer shall “utilize, as a factor in determining any condition of employment including hiring, promotion, termination… any record of arrest or detention that did not result in conviction.”

An arrest is an accusation, and the employer should not assume that the employee committed the crime. Because the initial information that an employer receives about the arrest usually is incomplete, the employer must be careful to gather the facts and not to overreact or rely on gossip and hearsay.

Employers are permitted to ask about arrests and the circumstances surrounding them. The primary purposes of an investigation are to:

• Understand the nature of the alleged conduct underlying the arrest.
• Was the arrest for violent conduct?
• Is the employee alleged to have committed a property crime such as theft or embezzlement?
• Confirm the employee’s job duties and the impact of the alleged conduct.
• Does the alleged conduct pose a risk because the arrested employee interacts regularly with co-workers and/or provides face-to-face customer service?
• Does the employee handle money and was accused of a money or property crime?
• Determine how much work the employee is likely to miss.
• Is it likely that the employee will be released from jail shortly and be able to return to work?
• Will the employer be able to hold the job open for the employee through the judicial process?
• Evaluate the impact to the employer.
• Is the arrested employee’s position integral to business operations?
• Is the arrest public information that may damage the employer’s reputation?
• Does the employer face potential civil liability if the employee returns to work?

An employer’s options are no action, paid suspension, unpaid suspension or termination for a reason other than the arrest.

Placing an arrested employee on leave is an appealing choice because it allows the employer to gather information, consult with legal counsel, and allow the judicial process to unfold. If the leave is unpaid, and no conviction results from the arrest, backpay may be considered.

If you learn that an employee has been arrested, it is best to deliberate carefully and consult with legal counsel before taking any adverse action against the employee.

Read more about Avoiding a Wrongful Termination Lawsuit in the HR Library.