The New York City Council recently passed a bill that would ban the use of credit checks during hiring. The bill, which was approved by a 47 to 3 vote, is set to drastically change the way people are hired. City council members who voted in favor of the bill say that one of the most important changes will be that the practice, which was disproportionately discriminatory towards blacks and Hispanics, will allow more people to get jobs they deserve.
Supporters Praise the Change
Labor unions, support groups and council members who supported this legislation will be especially elated by its approval, because of similar bills being rejected in past years. This bill will help to end a form of discrimination that has been improperly valuating potential employees since the 90s, when the credit bureaus found a new market in hiring managers.
For years now, credit checks have been used in the hiring process as a way to supposedly gauge a person’s trustworthiness. However, there have been no studies to prove a correlation between bad credit and bad character.
In a statement by the president of Retail, Wholesale and Department Store Union, Kathryn Wylde said that “the final version of the bill strikes a balance that most employers feel they can live with. It is important, however, to monitor the cost and consequences of this legislation to ensure that city government is not unwittingly putting businesses and consumers at risk.”
Opposition Fear the Risks
Opposition to the legislation argues that this bill, admittedly pro-employee, can put unnecessary risk on employers. By asking employers to hire an employee without knowing their financial background could allegedly open businesses up to increased risk of theft or embezzlement from financially unstable candidates.
The bill does have some exemptions. Police officers, employees with government security clearances, and employees that would have power to sign over third-party assets worth $10,000 or more are exempt from this bill and subject to credit checks.
Garland & Mason, L.L.C. – New Jersey employment lawyers