Senate Bill Limiting Credit Reports Proposed

US Senator, Elizabeth Warren, recently filed Senate Bill 1837, cited as the "Equal Employment for All Act of 2013." The bill would amend the Fair Credit Reporting Act to prohibit the use of consumer credit checks for employment purposes.

If passed, Senate Bill 1837 would prohibit employers from asking employees and prospective employees about their credit histories or from obtaining that information from a consumer credit report. Employers would not be permitted to use, or cause to be procured, a consumer report or investigative consumer report with information on a consumer's creditworthiness, credit standing, or credit capacity. The prohibition would apply when the information is used for employment purposes or when an employment-related adverse action is taken. The prohibition would apply even if the consumer consents to or otherwise authorizes the procurement or use of a consumer report for employment purposes or in connection with an employment-related adverse action.

There are two exceptions in the bill:

  • The consumer applies for, or currently holds, employment that requires national security clearance
  • It is otherwise required by law
This type of legislation is a growing trend at the state level. In 2013, Colorado and Nevada passed legislation restricting employers' use of credit information. States with similar laws include California, Connecticut, Hawaii, Illinois, Maryland, Oregon, Vermont and Washington. There are four states that are currently considering similar legislation, and another three states have already pre-filed legislation for consideration in 2014. 

Liberty Screening will continue to monitor and report on this trend going forward.

A copy of Senate Bill 1837 is available here: