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Your Employee Matters


By October 1, 2010No Comments

Many HR That Works Members have asked about limitations on using credit checks under federal and state laws. Here’s the most recent EEOC “informal” discussion letter on this topic.

As of this date, four states (Illinois, Hawaii, Oregon, and Washington) have laws restricting the use of credit checks to employees in financially sensitive positions – never mind that an applicant or employee with poor credit is a greater overall “risk” for employers. The Illinois statute is typical in limiting credit checks to:

  • Positions involving access to sensitive information
  • Positions involving unsupervised access to cash or marketable assets valued at more than $2,500
  • Positions with signatory power over business assets of $100 or more per transaction
  • Managers who set the direction of or control a business
  • Positions for which the employer is required by law to obtain a bond
  • Positions for which state or federal law or regulation establishes credit history as a bona fide occupational qualification
  • Positions for which the law requires employers to obtain credit history

This is one reason why we recommend that you work with our partner Global HR Research, who stays on top of these developments.