Maryland Joins Illinois, Washington, Oregon, and Hawaii in Restricting Employment Credit Reports

PRLog (Press Release) - May 6, 2011 - Elk Grove, CA  May 6, 2011–  HireSafe Employment Background Screening, a division of Data Research Network, Inc., reports that the recent legislation signed by Maryland Governor O’Malley called the Job Applicant Fairness Act, which generally prohibits employers from using an applicant’s or employee’s credit history in making employment decisions, goes into effect on June 1st. Specifically, the Act prohibits most employers from using credit history in determining whether to deny employment to a job applicant; discharge an employee; decide compensation; or evaluate other terms and conditions of employment, unless it meets specific timing and job-relatedness requirements.
The Act applies to employers of any size, but certain employers are specifically excluded from the Act’s coverage. Various financial institutions, as well as employers who are required to inquire into an applicant’s or employee’s credit history under federal or state law, are excluded from the Act’s prohibitions.

Maryland now joins Illinois, Washington, Oregon, and Hawaii as states that currently have restrictions or prohibitions on the use of credit information in employment decisions.
The various state laws provide limited exceptions that allow employers to request or use credit information where such information is related to a “bona fide purpose that is substantially job-related.” The bona fide purpose exception generally applies to those positions involving money-handling or other confidential job duties. For instance, employers may request or use credit information for employees in managerial positions that control or direct part of the business, employees who are provided expense accounts or corporate credit cards, and employees who have access to confidential business information. Notably, where an employer chooses to request or use credit information for a bona fide purpose, it must disclose its intent to do so in writing to the employee or applicant.

HireSafe continues to advise their clients to only request credit reports where there is a clearly defined business need. Employers who use credit history as a routine part of a background check or other hiring processes should evaluate their policies in light of the recent momentum against using such information in employment decisions.
HireSafe offers intelligent, customer-driven solutions that help clients to lower cost, increase efficiency and reduce their exposure to employee liability risk. Formed in 1997, HireSafe is one of the earliest adapters of compliant and legal employment background screening. As a licensed CA Investigative Agency, HireSafe clients are assured of FCRA compliance with all state and federal background screening laws.

For more about HireSafe business solutions, news and policies, visit: http://www.hiresafe.com

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Hiresafe offers world class investigative background check services tailored to every level of employment needs, encompassing more than 75 different services in more than 250 countries and territories worldwide.