Someone I know was recently offered a job even though they clearly indicated on application that they have a felony conviction of 1st degree sexual assault. Company offered the job & person accepted, and gave notice at other job. Company then had a background check completed by a contracted company, and called the person 4 days before they were to start new job to tell them job offer was being withdrawn due to information received on background check. Only information on background check was sexual assault (felony). Company that is denying employment is a factory environment, with no children present. Can they legally do this?
I am a California attorney and not eligible to give legal advice in your state. The following is information only, based on federal law and general legal principles. YOUR STATE MAY HAVE ITS OWN LAWS THAT PROVIDE SIMILAR OR GREATER PROTECTION.
This is a very tough situation and the law really isn't a lot of help in these circumstances.
While I don't know your state's laws because I am a California attorney, in most circumstances and employer can revoke a job offer, can fire a person one minute after he or she starts work, or do whatever it wants to do with respect to employment -- unless there is a law that specifically prohibits the employer from taking a certain kind of action. This is a function of at-will employment. For a general summary of at-will employment law, please look at my guide on CALIFORNIA's at-will employment: http://www.attorneyqna.com/legal-guides/ugc/a-short-summary-of-california-at-will-employment. Your state's at-will laws will probably have some differences from those in California, but the guide should give you a general idea.
Your friend might be able to do something if he had good reason to rely on the job offer, quit his job in reliance on the offer, and was harmed. This would be a claim of detrimental reliance, or a similar claim that exists in your state. However, it is very likely the employer's offer to your friend was contingent on the background check; if so, there would not be a claim for detrimental reliance. And if the offer was made orally and the employer falsely claims there was a condition, your friend will have an uphill battle proving the employer did not convey any conditions.
Of course, I am commenting based on the very limited information you provided and I don't know Iowa law. To find a plaintiffs employment attorney in your area, please go to the web site of the National Employment Lawyers Association (NELA). NELA is the largest and most influential bar association in the country for attorneys who represent working people. The web site is www.nela.org, and you can search for attorneys by location and practice area.
Also, NELA has affiliates in every state and in many cities. On the NELA web site, you can look at the list of affiliates. Some attorneys will be listed in the affiliate membership list, some in the national organization membership list, and some in both. Being listed in one or both lists should not influence your selection because attorneys can choose whether or not to purchase the listing in the national directory. Each local affiliate has its own rules for listing.