Discrimination Based On Credit Score And Other Protected Grounds Under NYC Human Rights Laws
Employment Discrimination Attorney Alena Shautsova
In May of 2015 New York Mayor signed into law a bill that bars employers from using job seekers’ credit score during the hiring process. “Every New Yorker applying for a job deserves a fair shot — and we are committed to protecting the rights of our workers and making sure that every New Yorker has the opportunity to succeed.", de Blasio said in a statement. "This bill will remove a barrier to employment and ensure that people are judged on their merits and ability, rather than unrelated factors." It means that a refusal to hire based on one’s credit score or history, or even a requirement to present one’s credit history/score may cause employer to be liable for damages, and attorney’s fees.
The Bill 261-2014 does have a number of exceptions to this general rule. Under the local law of the City of New York No 37 those exceptions are as follows:
- an employer, or agent thereof, that is required by state or federal law or regulations or by a self-regulatory organization as defined in section 3(a)(26) of the securities exchange act of 1934, as amended to use an individual's consumer credit history for employment purposes;
- persons applying for positions as or employed:
- as police officers or peace officers, as those terms are defined in subdivisions thirty-three and thirty-four of section 1.20 of the criminal procedure law, respectively, or in a position with a law enforcement or investigative function at the department of investigation;
- in a position that is subject to background investigation by the department of investigation, provided, however, that the appointing agency may not use consumer credit history information for employment purposes unless the position is an appointed position in which a high degree of public trust, as defined by the commission in rules, has been reposed.
- in a position in which an employee is required to be bonded under City, state or federal law;
- in a position in which an employee is required to possess security clearance under federal law or the law of any state;
- in a non-clerical position having regular access to trade secrets, intelligence information or national security information;
- in a position:
- having signatory authority over third party funds or assets valued at $10,000 or more;
- that involves a fiduciary responsibility to the employer with the authority to enter financial agreements valued at $10,000 or more on behalf of the employer.
- in a position with regular duties that allow the employee to modify digital security systems established to prevent the unauthorized use of the employer's or client's networks or databases.
It must be noted that the exceptions listed above are not carte blanche for the financial industry to check credit score of all of its potential workers. This was specifically emphasized during the City Council hearings.
In addition, if usage of the credit score/history has a disparate effect on the group of employees, this in its turn may result in findings of unlawful discrimination based on protected grounds. Example: an employer lawfully checks credit history of its potential employees, however, rescinds job offers for majority of African American candidates whose score is “poor” and does not do it for White applicants.