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Applicant Screening.jpgMayor Bill De Blasio has signed into law a bill passed by the New York City Council making it unlawful for employers to use an individual’s consumer credit history in making employment decisions. New York City will become the twelfth jurisdiction in the country to prohibit employers from using credit checks to screen job applicants. The law will take effect on September 3, 2015.

Not only does the bill make it unlawful for employers to use an applicant’s credit history when making employment decisions, but it also makes it unlawful for employers to request credit history for employment purposes, unless an exception is met.

The law provides the following exceptions making consideration of credit history lawful:

  • employers required by state or federal law or regulations, or by a self-regulatory organization as defined in Section 3(a)(26) of the Securities Exchange Act to use an individual’s consumer credit history for employment purposes;
  • police officers, peace officers, or those in a position with law enforcement or investigative function at the department of investigation (or in certain positions subject to background investigation by the department of investigation);
  • positions requiring the employee to be bonded by City, state or federal law;
  • positions requiring the employee to possess a security clearance under federal or state law;
  • non-clerical positions having regular access to trade secrets, intelligence information or national security information;
  • positions having signatory authority over third party funds or assets valued at $10,000 or more, or positions that involve a fiduciary responsibility to the employer with authority to enter financial agreements on behalf of the employer for $10,000 or more;
  • positions that allow the employee to modify digital security systems protecting the employer or client’s networks or databases.

The amendment to the New York City Human Rights Law regarding credit checks applies to New York City employers of four or more individuals, and is enforceable through the City Commission on Human Rights or by civil action.

New York City employers are advised to evaluate and reassess their practices and procedures regarding employment-related credit checks prior to September 3, 2015.

Employers should:

  • Review whether the positions for which they obtain credit history consumer reports qualify under the New York City exceptions
  • Review the language contained in their disclosure forms used in New York City, since the law additionally prohibits employers from requesting credit history
  • Revise pre-hire procedures and forms to distinguish between positions for which pre-employment credit checks will or will not be conducted.

Paypro’s Applicant Screening Solution is a great option for employers whether screening is undertaken to make better hiring decisions, supporting the transfer of current employees to other areas of the business or meeting specific contract requirements. Please contact us for more information on how Paypro can provide you with a customized online applicant screening process.