Illinois has passed a new law which prohibits employers from discriminating against job seekers or employee’s based on credit history. The new law will remove a significant barrier to employment for the growing segment of the population whose credit history has been affected by the historic national recession. The new law will take effect Jan. 1, 2011.
Under the bill, sponsored by Rep. Jack Franks (D-Woodstock) and Sen. Don Harmon (D-Oak Park), employers may not use a person’s credit history as a factor in determining employment, recruiting, discharge or compensation. Employers are also prohibited from even inquiring about credit history or obtaining a credit report. Employers will still be able to conduct background checks on potential employees or current employees provided it does not contain any credit information.
The new law does allow for some limited access to credit check information for positions that involve bonding or security as required by existing state and federal laws. Such situations include positions that allow unsupervised access to more than $2,500; signatory power over businesses assets of more than $100; management and control of the business; access to personal, financial or confidential information, trade secrets, or state or national security information.
Employers who violate the new law may face civil liability for damages or injunctive relief.
Pre-employment credit screenings have been on the rise in recent years, with businesses using them as part of what’s considered a “standard” background check. The Society for Human Resources Management recently found that 60 percent of employers run a credit check on at least some applicants. That is an increase from the 42 percent in 2006 and 25 percent in 1998. Recently, four Ohio Congress members and Senator Sherrod Brown stepped in to try and stop local defense related firings over credit rating issues.
“A job seeker’s ability to earn a decent living should not depend on how well they are weathering the greatest economic recession since the 1930s,” said Governor Quinn after the signing. “This law will stop employers from denying a job or promotion based on information that is not an indicator of a person’s character or ability to do a job well.”
There are no comments
Add yours