New Illinois law prohibits employers from checking credit history

On Tuesday, August 10, 2010, Governor Pat Quinn signed a bill into law that prohibits Illinois employers from discriminating based on a job seeker or employee’s credit history.

On Tuesday, August 10, 2010, Governor Pat Quinn signed a bill into law that prohibits Illinois employers from discriminating based on a job seeker or employee’s credit history. This new law will remove a significant barrier to employment for the growing segment of the population whose credit history has been affected by the historic national recession. The new law takes effect Jan. 1, 2011.

Sponsored by Democrat Rep. Jack Franks and Democrat Sen. Don Harmon, House Bill 4658, creates the Employee Credit Privacy Act. Under the act, Illinois’ employers may not use a person’s credit history to determine employment, recruiting, discharge or compensation. The new law also forbids employers from inquiring about an applicant or employee’s credit history or obtaining a copy of their credit report. The law does not affect an employer’s ability to conduct a thorough background investigation that does not contain a credit history or report.

Employers who violate the new law can be subject to civil liability for damages or injunctive relief.

Under the new law, employers may access credit checks under limited circumstances, including positions that involve: bonding or security per state or federal law; unsupervised access to more than $2,500; signatory power over businesses assets of more than $100; management and control of the business; access to personal, financial or confidential information, trade secrets, or state or national security information.