New York City has joined a growing group of locations that restrict the use of credit history in the hiring process. Starting September 3, 2015, NYC will prohibit employment discrimination based on a job applicant’s or an employee’s consumer credit history. Credit history cannot be used in hiring, compensation, or the terms or privileges of employment.
Credit history under the New York law includes the individual’s credit worthiness, credit standing, credit capacity or payment history.
Like many other laws restricting the use of credit reports, exceptions are available when required by state or federal law. There are also exceptions available for certain positions, including employees who need security clearance, employees with fiduciary duties, employees with access to trade secrets and employees with regular access to digital security systems of the employer or its clients’ networks.
Employers in New York City that use credit checks as part of employment or applicant screening should review their processes in light of the new law.