ROCHESTER, N.Y. (Spectrum News 1) — A new state law will limit how employers can use your credit history.
Brochures fill the wall inside Karyn Rando’s office at the Consumer Credit Counseling Service of Rochester. One of the biggest things she helps clients with is missing out on employment due to bad credit history. Now, thanks to a new law, that will change.
New York joins 10 other states, making it illegal for most employers to look at your credit history. This means information about your credit score or late payments can’t be used in the hiring process.
“It will allow them to apply for more jobs and really get in the door to meet with employers and talk about the skills they have for that particular role,” said Rando.
There are some exceptions to this new law. Law enforcement positions, jobs that handle large amounts of money or trade secrets, positions with high public trust or security clearance or jobs in the financial industry can still require credit checks.
Jared Cook, an employment attorney with Tully Rinckey, says the best thing for employers: start reviewing your hiring processes now.
“If you use any third parties to conduct background checks, make sure they’re aware of it and aren’t going to do anything on your behalf,” said Cook.
Rando says credit reports don’t always show the full picture.
“They might’ve had financial hardship that is unfortunately showing up on their credit report, but it could be something they had no control over,” said Rando. “Maybe it was a medical issue that resulted in a missed payment or a series of missed payments.”
Even though credit history won’t be used in employment, it’s still important to be aware of what’s on the report.
