The California legislature recently passed a bill prohibiting employers – with some specific exceptions – from obtaining and using credit reports to screen candidates and employees. Check out this report at Law360. California becomes not the first, but the sixth state to have passed similar legislation, joining Hawaii, Washington, Oregon, Illinois and Maryland. Even more states are considering similar restrictions, and there’s even a proposal before Congress that would do the same thing on a national level. What else? Oh, the EEOC takes the position that the use of credit reports may be biased against minorities and females. Here’s the EEOC’s official take. So, not only may using these reports be unlawful in many states, but you could also face charges of discrimination over the use of credit reports. Finally, don’t forget that the bankruptcy code, which applies nationwide, prohibits an employer from discriminating against an employee on the basis of bankruptcy – basically, you can’t fire someone solely because of a bankruptcy, whether your business is a financial institution or not.
Continue Reading Coming Soon . . . A Ban On Using Credit Reports in Employment