New York State Fair Credit Reporting Act<\/a>.<\/p>\nNew York is now one of 11 states that prohibit credit checks for employment decisions.<\/p>\n
This law prohibits an employer, or potential employer, from using a consumer credit report in their decision to \u201chire, terminate, promote, demote, discipline, compensate, or in setting the terms, conditions, or privileges of employment.\u201d<\/p>\n
The law also prohibits state or municipal agencies from requesting or using \u201cfor licensing or permitting purposes, information contained in the consumer credit history of an applicant, licensee, or permittee for licensing or permitting purposes.\u201d<\/p>\n
But the law does not apply to agencies required by state or federal law to use an individual\u2019s consumer credit history for licensing or permitting purposes.<\/p>\n
The law places the burden on employers to demonstrate that an exception applies before accessing credit information.<\/p>\n
According to the New York State Legislature\u2019s summary of the law, \u201cthere is little to no evidence that shows a correlation between credit history and job performance.\u201d<\/p>\n
Still, \u201cthe majority of large employers are now using credit checks in the hiring process and in how they treat existing employees,\u201d according to the summary.<\/p>\n
\u201cIn addition to lacking any such meaningful correlation, the Federal Trade Commission has released a study indicating that as many as one in four consumers may have a \u2018material error\u2019 in their credit reports,\u201d according to the summary.<\/p>\n
\u201cMany New Yorkers, through no fault of their own, have less than ideal credit histories that may stem from issues completely unrelated to their job performance or capabilities. These consumers are disadvantaged because employers are using credit reports to determine if an applicant or employee is worthy of a job or a promotion. This bill would put an end to this practice,\u201d according to the summary.<\/p>\n
There are a few exceptions under the new law, including law enforcement workers, and those who have a security clearance for their job.<\/p>\n
Previously, New York City was the only area in New York state where credit checks for employment decisions were banned. But the Stop Credit Discrimination in Employment Act was passed in September 2015.<\/p>\n
Legal experts say the new statewide law will help promote fair hiring practices and reduce barriers to employment that are tied to financial hardship.<\/p>\n
The law is expected to help reduce potential discrimination related to financial history and shift the focus to skill-based or merit-based hiring.<\/p>\n
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Jared Cook<\/p>\n
\u201cIf people are going to discriminate against applicants on the basis of their finances, it creates a situation where people who are already having bad financial luck get into a deeper hole because they already have money problems, and then can\u2019t find a job because their money problem is going to get used against them,\u201d said Jared Cook, senior counsel at Tully Rinckey PLLC\u2019s Rochester office.<\/p>\n
\u201cThat\u2019s the biggest concern behind this law. We want to make sure that people can get employment. We want people to be able to work,\u201d Cook said.<\/p>\n
\u201cIt\u2019s no secret that the economy is difficult for a lot of people right now, \u00a0and has been for the past several years, and there are probably more and more people that are more extended on their credit than they may have been in the past, and I think the state is probably responding to some of those concerns,\u201d Cook said.<\/p>\n
For businesses that do criminal background checks, Cook advises them to make sure that, if the check is outsourced, make sure it does not include a credit check.<\/p>\n
\u201cFolks should be aware of that, if you outsource any kind of background check to a third party, make sure that you communicate with them and tell them, we don\u2019t want you to do a credit check as part of that background check because that\u2019s illegal in New York now,\u201d he said.<\/p>\n
\u201cIt\u2019s not illegal to do a background check, but employers should be aware that there are certain restrictions on the way you can use somebody\u2019s criminal history against them,\u201d he said.<\/p>\n
[email\u00a0protected]<\/a> \/ (585) 232-2035<\/p>\ni<\/p>\n","protected":false},"excerpt":{"rendered":"Listen to this article Summary: New York law bans credit checks in employment decisions Governor Kathy Hochul signed…\n","protected":false},"author":2,"featured_media":198729,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[78097,18959,75155,426,9,11,10,49,79145,51,50,79146],"class_list":{"0":"post-198728","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-new-york","8":"tag-credit-history","9":"tag-employment-law","10":"tag-ftc","11":"tag-kathy-hochul","12":"tag-new-york","13":"tag-new-york-headlines","14":"tag-new-york-news","15":"tag-new-york-state","16":"tag-new-york-state-fair-credit-reporting-act","17":"tag-new-york-state-headlines","18":"tag-new-york-state-news","19":"tag-ny-legislature"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/198728","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=198728"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/198728\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/198729"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=198728"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=198728"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=198728"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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