LIMITS TO EMPLOYER’S USE OF CREDIT HISTORY (Effective Date: 4/18/26)

The New York Fair Credit Reporting Act has been amended to significantly restrict the use of consumer credit reports in employment-related decisions. This includes hiring, promotions, setting compensation, imposing discipline and other terms of employment.

Under this amendment, the law only allows employers to utilize the results of an individual’s credit history in only limited circumstances. Specifically, an employer may request or use credit info if:

• Legal Mandate: State or federal law, or a self-regulatory organization, requires the employee to have a specific credit standing.
• Heightened Clearance: The position requires elevated security clearance or access to intelligence/national security information.
• Financial Oversight: The individual has signatory authority over third-party funds or assets valued at $10,000 or more or holds a fiduciary role permitting them to enter financial agreements of that value.
• Digital Security: The party is responsible for modifying digital security systems designed to protect an employer’s or client’s networks or databases.