Did you know that employers in New York City are generally prohibited from requesting consumer credit history from employees or job applicants? As codified under N.Y.C. Admin. Code § 8-107, subd. 24(a), employers may not, with narrow exceptions, request or use consumer credit information for the purposes of employment pursuant to the SCDEA (the statute through which the NYCHRL was amended). Thus, employers must understand that even if no action is taken based on any consumer credit information provided, it is a violation of the SCDEA to merely ask for such report(s).
As we move forward with this series, we have, in this blog post, hammered on what New York State Law says about running credit checks on employees and job applicants.
New York State Laws on Running Credit Checks on Job Applicants
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.
Further, any employer seeking a job applicant or employee’s credit information is required, under the New York’s Fair Credit Reporting Act and FCRA and as codified under 15 U.S.C. § 1681b(b), to (1) obtain written consent from the person, provide the individual with notice that the credit information may be requested, and, if the employer seeks the information, (3) provide the employee or job applicant with the address and name of the consumer reporting organization involved with compiling such reports.
Most importantly, the statute also provides that the employee or job applicant has the right to be provided with a copy of the consumer credit report from the compiling agency.
In Part XVIII of this series and our blog titled “New York Law on Seeking Salary History from Job Applicants,” we will hammer on what the New York State Law says about conducting credit checks on employees or job applicants, 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.
In the interim, if there are any questions or comments, please let us know at the Contact Us page!
Always rising above the bar,
Isaac T.,
Legal Writer, Author, & Publisher.