What does New York State Law say about running credit checks on employees and job applicants? It is crucial to note that if an employer is anywhere else other than New York City, then they may seek consumer credit information and use the same for the purposes of employment. However, any employer who wishes to request for credit report for the purposes of employment is required, under the FCRA (Fair Credit Reporting Act) and as codified under 15 U.S.C. § 1681d, to (1) certify that the reports will not be used for other purposes, (2) certify the purpose for which they are requesting the reports, and (3) identify themselves.
As we move forward with this series, we now look into what the NYCHRL and State laws say about requesting salary or wage information from employees and job applicants.
New York Law on Seeking Salary History from Job Applicants
Both the City and State of New York have laws that dictate whether employers should seek salary history information from job applicants or not.
On the one hand, as codified under N.Y.C. Admin. Code § 8-107, subd. 25, employers are generally prohibited by the NYCHRL from inquiring into and seeking the salary history of a job applicant or depending on such history as the basis of negotiating or determining employment. It is critical for employers in New York City to understand that any information inquired regarding bonus compensation and current and/or past salary or wage reports, including benefits such as medical benefits, is considered salary history. However, the law permits employers to make hiring decisions after verifying and relying on salary history information, as long as such information is voluntarily disclosed by the job applicant but without the influence or persuasion of the employer.
On the other hand, New York State prohibits employers from seeking and/or depending, during the interviewing and hiring process, on the salary or wage history of current employees or job applicants as the basis of employment. Furthermore, New York also prohibits employers from retaliating against employees or job applicants on the basis of salary history or wage information. However, the law also provides that without employer influence or prompting, an employee or job applicant may, voluntarily, disclose or verify salary history and/or related wage information. Pursuant to N.Y. Lab. Law § 194-a, an employer is permitted to confirm the applicant or employee’s salary or wage history once the former has made an employment offer with compensation and the latter has provided salary or wage information in response to the offer of employment.
In Part XIX of this series and our blog post titled “Seeking Salary History in Westchester, Albany, & Suffolk Counties,” we will hammer on what the law in Westchester, Albany, & Suffolk Counties says about inquiring into job applicants’ salary history, which is another key employment issue that significantly affects start-ups and growing businesses and companies in New York.
As usual, stay tuned for more legal guidance, training, and education.
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Always rising above the bar,
Isaac T.,
Legal Writer, Author, & Publisher.