NYC Bans Credit Reports

Yes, it happened. New York City Governor, Bill DeBlasio signed the law on 05/08/2015 making it illegal for most employers to use credit reports for pre-employment screening purposes.

We hinted to this strong possibility in our previous post. New York City’s ban is considered the broadest ban in the country as of yet. The law effectively bans most employers from not only using credit information during the screening process, but also most kinds of financial information as well, such as: bankruptcies, open accounts, etc.

Exceptions to the law include:

• positions with

• (i) signatory authority over 3rd party funds or assets valued at $10,000p or more, or

• (ii) authority to enter into financial agreements valued at $10,000 or more on behalf of the employer

• positions with regular duties allowing an employee to modify digital security systems designed to prevent the unauthorized use of the employer’s or client’s networks or databases

• non-clerical positions with regular access to trade secrets or national security/intelligence information

• employers required to consider credit history for employment purposes under state or federal law/regulations or by a self-regulatory organization (SEA of 193.4)

• various public safety positions (police, investigators a& others subject to background investigations)

• positions requiring bonding under federal, state or city law and

• positions requiring security clearance under federal or state law.

Employers are highly encouraged to take a look at their screening process to determine if they are compliant with these laws. If any questions arise, they should contact legal counsel or their screening service for more information.

Employers Investigative Services is not a legal firm. They are a nationwide provider of pre-employment and tenant screening services. They can be contacted toll free for (866) 350-5638 for a free consultation.