The Stop Credit Discrimination in Employment Act (“SCDEA”) signed by Mayor Bill De Blasio went into effect on September 3, 2015. The overarching premise of the law prohibits employers from using an individual’s consumer credit history when making employment decisions about applicants or current employees. Employers that operate in New York City are encouraged to read the entire text of the law to assess its impact on their organization. Full text of the law can be found here.
There are exceptions to the law which permits employers to conduct credit checks for the following positions:
— where employers are required by state or federal law or regulations, or by a self-regulatory organization (such as FINRA) to use an individual’s consumer credit history for employment purposes;
— police officers, peace officers, or those in a position with law enforcement or investigative function at the City of New York Department of Investigation (“DOI”) (or in certain positions subject to background investigation by the DOI);
— certain positions working for the City of New York subject to a background investigation by the DOI;
— positions requiring the employee to be bonded by City, state or federal law;
— positions requiring the employee to possess a security clearance under federal or state law;
— non-clerical positions having regular access to trade secrets, intelligence information or national security information;
— positions having signatory authority over third party funds or assets valued at $10,000 or more, or positions that involve a fiduciary responsibility to the employer with authority to enter financial agreements on behalf of the employer for $10,000 or more; and
— positions that allow the employee to modify digital security systems protecting the employer or client’s networks or databases
The New York City Commission on Human Rights (NYCCHR) has issued guidance related to the law for employers and employees/applicants; information related to that guidance can be found here.