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Memorandum of Support

Empire Justice Memo of support: The Misuse of Credit History Information Must be Restricted

A.8070A (Stevenson)       

Empire Justice Center strongly supports A.8070A, referred to as the “Credit Privacy in Employment Act.”  This bill would restrict the harmful use of credit history information in hiring, promotion, termination, compensation, and other employment-related decisions.  We believe the bill would reduce unfair and nonsensical barriers to employment by prohibiting the harmful use of credit history in employment-related decisions. 

Employers are increasingly checking prospective, as well as current employees’ credit histories.  The practice blocks qualified applicants - including people whose credit was damaged as a result of medical debts, divorce, layoffs or other life events beyond their control - from desperately needed jobs and advancement.  It also impacts people whose credit reports contain erroneous information- sadly, not an uncommon occurrence.     

Even though there is a lack of evidence of any correlation between job performance and credit history, the practice has grown because the credit bureaus heavily market the use of credit reports to employers as a way to make more money.  The practice has a discriminatory impact on lower-income New Yorkers who have been disproportionately affected by the economic downturn, and stalls our state’s economic recovery by blocking access to jobs. 
The use of credit checks by employers also represents an unprecedented invasion of privacy, particularly given that past due medical bills make up the majority of accounts reported by collection agencies.  For many job applicants, this means that as a pre-requisite to employment, they have to expose and discuss their personal medical histories, as well as other highly personal events that appear in an individual’s credit history, such as divorce.

This memo was prepared by:

Kirsten E. Keefe

Empire Justice Center
119 Washington Avenue
Albany, NY  12210 

(518) 462-6831
(518) 935-2852