In a growing trend, Nevada joins nine other states to prohibit the use of consumer credit reports or other credit information for employment purposes. The new legislation goes into effect on October 1, 2013.
The legislation prohibits employers from:
- Requiring an employee or prospective employee to submit to a credit report or other credit information as a condition of employment.
- Using, accepting, referring to, or inquiring about a consumer credit report or other credit information
- Taking or threatening adverse action against a person who refuses to submit to a consumer credit report.
- Taking or threatening adverse employment action based on an individual's consumer credit report or other credit information.
- Taking or threatening adverse action against an employee or prospective employee in retaliation for exercising his or her rights or the rights of another person. This includes filing a compliant or a legal proceeding, or testifying in a legal proceeding.
The law applies to both private and public employers in the State of Nevada, with few exceptions. Employers may request or consider consumer credit reports or other credit information for employment purposes only if it is required or authorized to do so by a state or federal law. Credit information may also be considered if an employer reasonably believes that an employee or applicant has engaged in activity which may constitute a violation of a state or federal law. The final exception to this new law is the credit information must be "job related." To apply this exception, the duties of the position must involve:
- Responsibility for financial assets or employment with a financial institution
- Access to confidential or proprietary information
- Managerial or supervisory responsibility
- Direct exercise of law enforcement authority as a government employee
- Responsibility for or access to another person's financial information
- Employment with a licensed gambling establishment
If an employer violates the new law, civil remedies include the right of employment for prospective employees and the right of reinstatement or promotion for employees. The employer may also be assessed lost wages and benefits, as well as reasonable costs and attorneys' fees. The new law allows enforcement by way of a class action.
The state also allows the state's Labor Commission to impose administrative penalties of up to $9,000 per violation and to bring an action for injunction requiring compliance with the law.
Other states with similar legislation are California, Colorado, Connecticut, Hawaii, Illinois, Maryland, Oregon, Vermont and Washington.
To review the legislation, please click here.