Account
Get our app
Account Sign up Sign in

Start a Consent to Background and Reference Check

Get permission to check on a job candidate’s application and background information.

Are there government benefits for hiring formerly incarcerated workers?

There are federal and state tax credits available for employers who hire individuals who have a felony conviction. At the federal level, the Work Opportunity Tax Credit is available for up to $2,400 for each new qualifying hire.

States may provide tax credit incentives as well. In Iowa, for example, business owners can deduct as much as $20,000 in taxes for each employee with a felony conviction.

Employers that hire workers with a criminal history might also be eligible for the Federal Bonding Program, which offers free fidelity bond coverage for employers when issues of theft or dishonesty arise.

Will the Federal Bonding Program apply to my business?

In short, yes.

Established in 1966, the Federal Bonding Program (FBP) incentivizes employers to hire individuals who might otherwise have a hard time finding a job, including those with a felony conviction. The FBP provides employers with a $5,000 bond for the first six months of the worker’s employment. If the employer loses any money because of fraud or dishonesty due to hiring the employee, then the bond will apply.

The bond provides employers some added insurance at no cost to them. It is available for all types of jobs and all types of employees, in any state and any industry. The program even applies to workers that are hired through temp or staffing agencies.

Is it illegal to reject an applicant because they are on parole or probation? 

Employers may have policies about hiring certain people who have a specific criminal conviction for specific roles or job functions. Being an ex-felon, or on parole or probation, is not protected under federal law. Still, a blanket policy that bars hiring individuals with felony convictions may exclude applicants illegally. There should be a legitimate business purpose related to the job in order to create a policy that excludes employees with criminal histories.

Some states are more restrictive than others. It can be a violation of state and local laws to hold an applicant’s criminal history against them. Employers in California, Hawaii, New Jersey, Minnesota, and Vermont, for example, cannot ask about criminal history at all on job applications. There are 35 states and over 150 cities that have similar laws. If you are unsure about the law in your state, it’s a good idea to ask a lawyer for advice on how to keep your hiring practices legal.

How can I mitigate the risks of hiring felons?

There are inherent risks any time you hire someone new, but you may have additional concerns when an applicant has a felony on their record. Sometimes asking what the conviction was based on, if you’re legally allowed to in your state, can help. For example, driving while intoxicated is a felony in some states. Depending on the role, some employers may be less concerned about that type of conviction than they might be for felony theft. The Federal Bonding Program, or similar state or local run programs, may also mitigate some financial risk.

Ultimately, you need to decide whether the individual is the best fit for the job. Take the time to get to know the person in the interview process. Hiring the right person for your needs may be  more important than the applicant’s criminal history. It is a little known fact that ex-cons are more loyal to their employer compared to other applicants.

Which employment policies matter most when hiring ex-convicts?

Generally, your policies surrounding recruiting and hiring are important to get right. You should check your state’s labor laws, or speak with a local attorney, to determine what you can and cannot ask on job applications and in interviews regarding criminal history. You may need to get signed consent before you run any criminal history checks on applicants as well.

An easy way to learn what laws apply to you and your business is to contact a Rocket Lawyer On Call® attorney to get answers specifically for your location and industry.

This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.


Ask a lawyer

Our On Call attorneys are here for you.
Characters remaining: 600
Rocket Lawyer On Call® Attorneys

Try Rocket Lawyer FREE for 7 days

Start your Premium Membeship now and get legal services you can trust at prices you can afford. You’ll get:

All the legal documents you need—customize, share, print & more

Unlimited digital signatures with RocketSign®

Ask a lawyer questions or have them review your document

Dispute protection on all your contracts with Document Defense®

30-minute phone call with a lawyer about any new issue

Discounts! Incorporate for FREE + hire a lawyer with up to 40% off*

*Free incorporation for new members only and excludes state fees. Lawyer must be part of our nationwide network to receive discount.

Trusted and secure
Better Business Bureau A+ rating