JPMorgan Chase joins second chance efforts to reduce obstacles to employment

JPMorgan Chase is expanding its commitment to giving people with criminal backgrounds a second chance by supporting their reentry into the workforce, community and local economies. The firm last week laid out a new public policy agenda, investing more in communities and enhancing its own hiring strategy in collaboration with other businesses to create economic opportunity for more people.

The unemployment rate is an estimated 27 percent for the roughly 5 million formerly incarcerated people in the U.S. — more than five times the overall national rate — and research shows that over 600,000 people are released each year from prison. Policymakers and businesses increasingly recognize that providing education, skills training and employment opportunities to people with arrest or conviction histories helps reduce recidivism, increase public safety, build stronger communities and strengthen the economy. 

JPMorgan Chase’s new efforts apply lessons learned and best practices as a major employer and from its community investments in cities like Detroit and Chicago. Specifically, the firm will apply its business resources and expertise — including data, research, talent and philanthropic investments — and collaborate with policy, business and community leaders to address the socioeconomic costs of barriers to employment for people with arrest or conviction histories.

The firm will help people with criminal backgrounds build in-demand skills and gain access to employment by:

• Public Policy Agenda: Advancing a public policy agenda through the new JPMorgan Chase PolicyCenter that reduces barriers to employment for people with criminal backgrounds;

• Community Investments: Making new community investments to support people with criminal backgrounds in cities like Chicago, Detroit, Nashville, New York, Seattle and Wilmington, Delaware that focus on career development, financial health and entrepreneurship, and encourage more companies in growing industries to hire them; and

• Hiring: JPMorgan Chase “banned the box” by proactively removing all questions about criminal backgrounds from job applications and is now enhancing its strategy to attract a broader applicant pool, including people with criminal backgrounds.

“Business has a responsibility to partner with policy, business and community leaders to create an economy that works for more people. When someone cannot get their foot in the door to compete for a job, it is bad for business and bad for communities that need access to economic opportunity,” said JPMorgan Chase Chairman and CEO Jamie Dimon. “Giving more people a second chance allows businesses to step-up and do their part to reduce recidivism, hire talented workers, and strengthen the economy.”

1. Public Policy Agenda

 JPMorgan Chase launched last week the JPMorgan Chase PolicyCenter, which will develop and advance sustainable, evidence-based policy solutions to drive inclusive economic growth in the U.S. and around the world.

Heather Higginbottom has joined the firm as president of the PolicyCenter. She previously served in senior policy roles in United States government, including deputy secretary of state, deputy director of the White House Office of Management and Budget, and deputy director of the White House Domestic Policy Council.

“Business must play a critical role in advocating for policies that unlock economic opportunity for more people in underserved communities,” said Higginbottom. “By working with political, business and community leaders, we will help advance public policy solutions that drive inclusive growth at all levels of government.”

 The PolicyCenter is powered by the firm’s global business resources and expertise, including data, research, talent, and philanthropic investments. It builds on the firm’s commitment to connecting underserved people with economic opportunity and will work with policy, business and community leaders to advance effective public policy solutions at all levels of government. 

 It will focus on issues such as job skills and education, small business capital and growth, community and economic development, infrastructure, affordable housing and financial health, and will begin by advocating for policies that lower barriers to employment for people with criminal backgrounds.

a. Reforming Financial Services Industry Hiring Rules:  The Federal Deposit Insurance Corporation limits financial institutions’ ability to hire people with specific types of criminal backgrounds.  JPMorgan Chase has supported recent reforms to Federal Deposit Insurance Act Section 19 and recommends making further changes to increase access to employment for affected workers, while maintaining the safety and soundness of the nation’s depository institutions.

b. Restoring Pell Grants: Restoring access to Pell Grants for incarcerated individuals who are academically eligible for higher education and increase their opportunity to find employment after their release, leading to reduced recidivism, enhanced public safety, lower government spending on prisons and higher earnings. The Violent Crime Control and Law Enforcement Act of 1994 included a ban on providing Pell Grants to incarcerated individuals.

c. Fair Chance Hiring: Supporting federal and state efforts to require background checks only after applicants have been given a conditional offer of employment. Requiring disclosure of criminal backgrounds on an initial employment application reduces the likelihood of callbacks and job offers from potential employers, even if an individual’s background has no bearing on job requirements.

d. “Clean Slate” Record Clearing: Supporting federal and state-level efforts to enact and implement automatic record clearing. The process for record clearing and expungement, which many states allow for crimes committed as a juvenile and for most misdemeanors, is time consuming and costly, creating barriers to employment.

e. Reforming Fines and Fees in the Justice System: Supporting efforts to reform laws that suspend drivers’ licenses for failure to pay fines or that right-size payments and provide alternative paths to compliance to ensure that millions of Americans can access workforce opportunities, improve their financial health and successfully reintegrate into their communities.

f. Entrepreneurship: Supporting efforts at the state and federal level to expand entrepreneurship resources that provide greater economic opportunities and mobility for people with criminal backgrounds and reduce recidivism.

2. Community Investments

JPMorgan Chase is investing more than $7 million to help community organizations in cities like Chicago, Detroit, Nashville, New York, Seattle and Wilmington connect people with criminal backgrounds with in-demand, well-paying jobs, the tools and resources they need to achieve their financial goals, and entrepreneurship training.

a. Skills Development: Collaborating with organizations such as the Heartland Alliance’s Rapid Employment and Development Initiative (READI) and North Lawndale Employment Network in Chicago, Project Return in Nashville and The Prosperity Agenda in Seattle to offer people with criminal backgrounds access to training space, skills training, mentorship and the other resources that would help them qualify for in-demand jobs across a multitude of sectors, including mechanics, hospitality, public safety, sanitation, construction, carpentry, manufacturing, management and distribution industries, among others.

b. Financial Health: Supporting organizations like Credit Builders Alliance, The Financial Clinic and the Detroit Employment Solutions Corp. (DESC) to expand financial coaching and build credit for people on parole and with criminal backgrounds.

c. Small Business: Working with organizations like Refoundry in New York to boost small business growth and entrepreneurship training for people with criminal backgrounds, using repurposed and restored home furnishings as a training pathway.

d. Best Practices: Collaborating with organizations like the National Employment Law Project (NELP), the Safer Foundation, the Center for Law and Social Policy (CLASP), Rodel Foundation of Delaware and the Dave’s Killer Bread Foundation to launch best practice toolkits and planning resources that help with the recruitment, hiring and retention of people with criminal backgrounds by major employers.

This builds on JPMorgan Chase’s investment model for impact through its $500 million AdvancingCities investment, which has been recognized by Harvard Business School and Fortune.

It also expands on a previous $5 million commitment to give people with criminal backgrounds a second chance and the firm’s existing efforts to develop best practices for the hiring of individuals with criminal backgrounds. Examples of previous philanthropic investments include supporting Texas’ Prison Entrepreneurship Program, collaborating with the National League of Cities to reduce the impact of court-related fines and fees, and developing a toolkit in collaboration with the NELP to provide guidance on hiring individuals with arrest or conviction backgrounds in the healthcare industry. 

“Despite some progress, there remain too many unnecessary barriers that make it especially difficult for people with arrest or conviction records to fully contribute to our society,” said Vanita Gupta, president and CEO of The Leadership Conference on Civil and Human Rights. “Private sector collaboration is necessary to move the needle and achieve real change. When corporate partners advance, implement, and resource inclusive solutions, we improve opportunities across the board. We commend JPMorgan Chase for its leadership and commitment to fair chance hiring and for advocating for policies that will give more people a true chance at getting ahead.”

3. Hiring

In 2018, JPMorgan Chase hired approximately 2,100 people in the U.S. with criminal backgrounds — roughly 10 percent of new hires. Many were arrested for or convicted of low-level crimes such as disorderly conduct, personal drug possession and DUI (driving under the influence), and are employed in entry-levels jobs such as transaction processing, and lending and account servicing.

To further broaden the applicant pool for job opportunities at the firm, enhance the hiring process and expand our commitment to building a diverse workforce, several actions are being taken:

a. JPMorgan Chase is committed to Second Chance hiring and “banned the box” to increase the access of people with criminal backgrounds to jobs at the firm. This helps ensure qualified applicants with criminal backgrounds receive the same consideration as any other applicant, when their background has no bearing on job requirements.

b. Launching new collaborations with community organizations to help JPMorgan Chase further build its pipeline for hiring people with criminal backgrounds — whose histories fit within industry regulatory guidelines — through training and mentorship programs, starting in Chicago. Some of the Chicago-based organizations that the firm is collaborating with include Skills for Chicagoland’s Future, Cara, the Safer Foundation and Cabrini Green Legal Aid.

c. Enhancing the firm's review and assessment process to help ensure that candidates, including those with a criminal background, are evaluated based on their qualifications and are not a risk to JPMorgan Chase’s employees and customers.

 In addition, JPMorgan Chase will work with other employers committed to adopting and promoting second chance hiring policies by sharing best practices, insights and learnings.