Today, Mayor de Blasio signed into law Intro. 261, which bans employers in NYC from using credit checks in hiring and promotion decisions. New Economy Project commends the Mayor and NYC Council for taking this important step to end employment credit checks. With this law, NYC is removing an unjustified and discriminatory barrier to jobs, which disproportionally harms New Yorkers of color. The new law not only represents an important civil rights victory, but is also the strongest law of its kind in the country.
As coordinator of the NYC Coalition to Stop Credit Checks in Employment, New Economy Project has for many years fought to end employment credit checks — as a matter of civil rights and economic and racial justice. Reports have found that nearly half of all employers use credit checks, even though there is no connection between credit reports and a person’s ability to do a job or likelihood to commit fraud or theft. Credit reports reflect the existing inequities in our credit system and economy; using credit information to make hiring and firing decisions leads to racial exclusion, unjustly blocks employment opportunity, and raises major privacy concerns. Plus, credit reports are notoriously riddled with errors.
The credit reporting agencies have aggressively driven this market, expanding their profits by selling credit reports to employers — even though, as a representative of one of the Big Three credit bureaus stated under oath, they know there is no connection between credit history and job performance.
We are pleased that the new law requires the NYC Human Rights Commission to issue a report in two years, analyzing the effect of the law’s exemptions on New Yorkers. We expect the analysis to show what we already know: that credit-based employment discrimination has no place in our city, or our country.
We look forward to working with the City to publicize and enforce this new law, which goes into effect in 120 days.