New Illinois Law Will Prohibit Discrimination Against Employees and Job Applicants Based on their Credit History

Legal Alerts

8.12.10

On August 10, Illinois Governor Quinn signed House Bill 4658 into law. The new law, the Employee Credit Privacy Act makes it illegal to use personal credit history to determine employment, recruiting, discharge or compensation. The new law forbids employers from inquiring about an applicant or employees’ credit history or obtaining a copy of their credit report. However, it is important to note that this new law does not prevent an employer from conducting a thorough background check that does not contain a credit history or report.

There are a number of exceptions to the new prohibition. For instance, employers may access credit checks under limited circumstances including positions that involved bonding or security per state or federal law; unsupervised access to more than $2,500; signatory power over business 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.

The law takes effect on January 1, 2011. In the meantime, employers will need to review their applicant process and their use of background checks and make necessary adjustments to come into compliance with this new law.

If you have any questions, or desire more information about the Employee Credit Privacy Act, please contact your Dykema relationship attorney. 


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