Use of Credit Information in Employment 2015 Legislation

Heather Morton 6/2/2015

Credit ReportThirty-one bills in 17 states relating to the use of credit information in employment decisions are pending in the 2015 legislative session.

Of the 31 bills, 28 address restrictions or exemptions on the use of credit information in employment decisions.

Eleven states currently limit employers' use of credit information in employment: California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont and Washington.

States that Limit the Use of Credit Information in Employment Map

 

Washington enacted legislation in 2007, Hawaii enacted legislation in 2009, Illinois and Oregon enacted legislation in 2010. California, Connecticut and Maryland enacted legislation in 2011. Vermont enacted its legislation in 2012. Colorado and Nevada enacted legislation in 2013. Delaware prohibited a public employer from inquiring into or considering the criminal record, criminal history or credit history or score of an applicant before it makes a conditional offer to the applicant in 2014.  The remaining states allow the use of credit information in employment decisions.

The chart below lists state legislation introduced or pending during the 2015 legislative session relating to the use of credit information in employment.

 

NOTE:  If you have questions regarding whether an individual employer can use credit information in employment decisions, please contact your state department of labor. NCSL is unable to provide assistance or advice in individual cases.

 
State Bill Number Bill Summary
Use of Credit Information in Employment 2015 Legislation
Alabama None  
Alaska None  
Arizona None  
Arkansas None  
California None  
Colorado None  
Connecticut

H.B. 6248

Failed Joint Favorable deadline 3/17/15

Prohibits employers from discriminating against current or prospective employees on the basis of such employees' consumer credit status.
Connecticut

H.B. 6789

Passed House 5/14/15

This bill both limits and broadens the circumstances under which an employer can require an employee or job applicant to consent to a credit report request. Current law generally prohibits employers from requesting an employee's or applicant's credit report, but allows it for positions involving access to $2,500 or more of nonfinancial assets, including museum and library collections and prescription drugs and other pharmaceuticals. The bill broadens this exemption to allow for credit report requests for positions with access to collections or drugs, regardless of their value, while also limiting this category of exemption to only those two types of nonfinancial assets.
Delaware None  
District of Columbia None  
Florida None  
Georgia H.B. 163 Prohibits employers from requesting credit checks on employees or prospective employees with certain exceptions; provides for penalties; provides a civil cause of action; provides for definitions; provides a short title; provides for legislative findings; provides for related matters; repeals conflicting laws; and for other purposes.
Georgia

H.B. 328

Signed by governor 5/5/15, Act 74

Requires notification to the consumer when a consumer reporting agency furnishes a consumer report for employment uses purposes.
Guam Not available  
Hawaii None  
Idaho None  
Illinois None  
Indiana H.B. 1600 Prohibits an employer from using a consumer report for employment purposes unless certain conditions apply. Allows a consumer to bring a civil action against an employer for a violation of this provision. Provides that if the attorney general has reason to believe that an employer has violated the provision, the attorney general may bring one or both of the following: (1) An action to enjoin the violation. (2) An action to recover damages sustained by Indiana residents as a result of the violation. Makes it: (1) a Class B infraction for a knowing or intentional violation of the provision; or (2) a Class A infraction if an employer has a prior unrelated judgment for a violation of the provision.
Indiana S.B. 15 Prohibits an employer from using a consumer report for employment purposes unless certain conditions apply. Allows a consumer to bring a civil action against an employer for a violation of this provision. Provides that if the attorney general has reason to believe that an employer has violated the provision, the attorney general may bring one or both of the following: (1) An action to enjoin the violation. (2) An action to recover damages sustained by Indiana residents as a result of the violation. Makes it: (1) a Class B infraction for a knowing or intentional violation of the provision; or (2) a Class A infraction if an employer has a prior unrelated judgment for a violation of the provision.
Iowa None  
Kansas None  
Kentucky None  
Louisiana None  
Maine

L.D. 1157

This bill prohibits employers from obtaining information regarding the creditworthiness, credit standing, credit capacity, debts or check-writing experience of a prospective employee as part of the hiring process or decision. There are exceptions from this prohibition in the bill for circumstances in which the job requires management of the company's finances or a customer's financial assets, the employer is in the financial services industry or the employer is otherwise required by law to obtain this information. Violation of this prohibition is a civil violation for which a fine from $500 to $1,000 for each violation may be adjudged. The prohibition is enforced by the Director of Labor Standards within the Department of Labor.
Maryland None  
Massachusetts H.B. 1736

Regulates the use of credit reports by employers and prospective employers.

Massachusetts S.B. 123

Regulates the use of credit reports by employers.

Michigan H.B. 4652 Prohibits employers from making certain recruiting or hiring decisions based upon an individual's credit history; prohibits employers from making certain inquiries; prohibits certain waivers; prohibits retaliation; and provides remedies.
Minnesota None  
Mississippi None  
Missouri H.B. 105 This bill prohibits an employer or an agent, representative, or designee of an employer from requiring an employee or prospective employee to consent to a request for a credit report that contains information about the employee's or prospective employee's credit score, credit account balances, payment history, savings or checking account balances, or savings or checking account numbers as a condition of employment unless: (1) The employer is a financial institution as defined in the bill; or (2) The report is required by law; An employee or prospective employee may file a complaint with the Department of Labor and Industrial Relations alleging a violation of the provisions of this bill. The department must conduct an investigation within thirty days after the filing of the complaint, and must render its findings. If the findings warrant, the department must hold a hearing to determine if a violation has occurred.
Montana None  
Nebraska None  
Nevada

S.B. 409

Sent to governor 5/28/15

Revises provisions related to the preparation of a credit report in connection with a person who is seeking certain employment with a gaming licensee; revises provisions governing the disclosure of certain information by a reporting agency.
New Hampshire

H.B. 365

Failed to pass House 3/12/15

This bill establishes the Employee Credit Privacy Protection Act which prohibits employers from using credit history in employment decisions.
New Jersey A.B. 1665

Prohibits job discrimination on basis of credit history or financial status.

New Jersey

A.B. 2298

S.B. 1130

Prohibits employers from obtaining, requiring, or discriminating on the basis of credit reports.

New Jersey

A.B. 2310

S.B. 524

Prohibits practice of requiring credit check as condition of employment.

New Mexico

S.B. 145

Passed Senate 3/17/15

Prohibits prospective employers from using a prospective employee's credit information as a basis for refusing to recruit or interview the prospective employee, with some exceptions.

New York A.B. 338

Limits an employer's access to consumer credit reports in connection with employment applications.

New York

A.B. 2372

S.B. 1545

Enacts the "credit privacy in employment act" to prohibit the use of consumer credit reports in hiring and employment determinations.

New York

A.B. 6405

S.B. 4483

Prohibits the use of credit history checks to ascertain the payment status of a student loan of an applicant for employment for the purposes of making hiring decisions except where otherwise mandated by law.
North Carolina S.B. 502

Prohibits employment discrimination on the basis of credit history or credit rating.

North Dakota None  
N. Mariana Islands Not available  
Ohio S.B. 65 Amends §§4112.02, 4112.05, 4112.08, and 4112.14 of the Revised Code to specify that discrimination by an employer against any person because of the person's credit history is an unlawful discriminatory practice under the Ohio Civil Rights Law.
Oklahoma None  
Oregon None  
Pennsylvania H.B. 1007 Provides that it shall be an unlawful discriminatory practice for an employer to require, as a condition of employment, an employee or prospective employee to consent to the creation of a credit report that contains information about the employee's or prospective employee's credit score, credit account balances, payment history, savings or checking account balances or savings or checking account numbers unless exceptions are met.
Pennsylvania S.B. 46

Prohibits employers from using consumer reporting under certain circumstances; and provides for enforcement.

Puerto Rico None  
Rhode Island None  
South Carolina None  
South Dakota None  
Tennessee None  
Texas H.B. 1515 Relates to the consideration by employers of the consumer credit reports or other credit information of employees and applicants for employment; provides civil and administrative penalties.
Texas H.B. 3964 Relates to the consideration by employers of the consumer credit reports or other credit information of applicants for employment who are recently returned veterans.
Utah

S.B. 159

Signed by governor 3/20/15, Chapter 43

This bill: defines terms; permits the Division of Finance to require background checks or credit history reports of a public employee in a public funds position; classifies the background check or credit history report as a private record; and makes technical and conforming amendments.

Vermont None  
Virginia None  
Virgin Islands None  
Washington None  
West Virginia None  
Wisconsin None  
Wyoming None  

 

 

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Heather Morton is a program principal in NCSL's Fiscal Affairs Program. She covers financial services, alcohol production and sales, and medical malpractice issues for NCSL.

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