CLIENT ALERT – Illinois Prohibits Employee Credit Checks
The recently enacted Illinois Employee Credit Privacy Act prohibits most Illinois employers from obtaining credit histories or reports and using them in any employment decision. The law prohibits (1) inquiring about an employee’s or applicant’s credit history; (2) seeking credit reports on employees or applicants from a consumer reporting agency; (3) and discriminating against an individual with respect to any aspect of employment because of his or her credit history or credit report. Employers are still permitted to conduct background investigations pursuant to the Fair Credit Reporting Act, so long as any report does not include credit history information. Certain employers are excluded from the reach of the statute, including financial and insurance institutions, debt collection agencies, and certain public sector employers. In addition, the statute provides a limited exception for positions or groups of employees for which a satisfactory credit history is a bona fide occupational requirement.
Employers with operations in Illinois are advised to revise their hiring and background check practices immediately to exclude seeking credit histories for applicants and employees in any form, including on an employment application, in an interview, or through procurement of credit history reports.