Law to End Pre-Employment Credit Checks

Lisette Livingston |

www.thechicagocitizen.com

45 years of serving the Black community

In tough economic times, a new law, which takes effect on Jan. 1, 2011 and that prohibits Illinois employers from discriminating based on a job seeker or employees credit history, is a step in the right direction as we face one of the nations deepest recessions in history.

The law, entitled the Employee Credit Privacy Act, removes a significant barrier to employment for people whose credit history has been affected by the economy. It was signed by Governor Quinn recently.

Under the law, Illinois employers may not use a persons credit history to determine employment, recruiting, discharge or compensation, unless one of the limited circumstances apply.

Sponsored by Rep. Jack Franks (DWoodstock) and Sen. Don Harmon (D-Oak Park), it forbids employers from inquiring about an applicant or employees credit history and precludes the employer from obtaining a copy of an applicants credit report. The law, however, does not affect an employers ability to conduct a thorough background investigation that does not contain a credit history or report. Employers who violate the new law can be subject to civil liability for damages or injunctive relief.

Under the Act, there are certain situations where employers may access credit checks including:

Positions that involve bonding or security per state or federal law

Unsupervised access to more than $2,500

Signatory power over businesses assets of more than $100

Management and control of the business and in situations where there is access to personal, financial or confidential information, trade secrets, or state or national security information.

According to the Society for Human Resources Management (SHRM), pre-employment credit screenings are on the rise where recent statistics indicate that 60 percent of employers run a credit check on at least some applicants. That s an increase from the 42 percent in 2006 and 25 percent in 1998, SHRM reports.

A job seekers ability to earn a decent living should not depend on how well they are weathering the greatest economic recession since the 1930s, Quinn said recently in a release.

This law will stop employers from denying a job or promotion based on information that is not an indicator of a persons character or ability to do a job well, he said.

Quinn also discussed the new law online at www.illinois.gov, where raw audio tape of his statements can be found.

Latest Stories

Latest Podcast

STARR Community Services International, Inc.