NYC Local Law 37 of 2015 Significantly Restricts Employers Use of Consumer Credit Profile

As you may already be aware, New York Local Law 37 of 2015 (NYC 37), passed on May 6th, 2015, is effective as of September 3, 2015.  This law prohibits employers from using an applicant’s consumer credit profile during employment related decisions such as hiring or promotion.  This law is applicable to all employers, both public and private, with exceptions as noted below.  As a result of NYC 37, changes are required to our Disclosure and Authorization form for employers domiciled in New York City. 

Changes to our Disclosure and Authorization Form, and submission process:

1. A specific authorization form needs to be used depending upon the candidates exemption status from NYC 37.

a. One form is for employees that are exempt from NYC 37

b. One form is for employees that are NOT EXEMPT from NYC 37

2. In addition to our updated disclosure form, we are requiring this checklist, which should be completed by a Human Resources Representative and not the applicant, accompany each request for a background check.  This form is intended to help guide the HR representative as to which authorization form to provide the applicant. 

Information about NYC 37

Employer Exemptions:

An employer, or agent thereof, that is required by state or federal law or regulations or by a self-regulatory organization as defined in section 3(a)(26) of the securities exchange act of 1934, as amended to use an individual's consumer credit history for employment purposes;

Employee Exemptions:

Persons applying for positions as or employed:

(A) as police officers or peace officers, as those terms are defined in subdivisions thirty-three and thirty-four of section 1.20 of the criminal procedure law, respectively, or in a position with a law enforcement or investigative function at the department of investigation;

(B) in a position that is subject to background investigation by the department of investigation, provided, however, that the appointing agency may not use consumer credit history information for employment purposes unless the position is an appointed position in which a high degree of public trust, as defined by the commission in rules, has been reposed.

(C) in a position in which an employee is required to be bonded under City, state or federal law;

(D) in a position in which an employee is required to possess security clearance under federal law or the law of any state;

(E) in a non-clerical position having regular access to trade secrets, intelligence information or national security information;

(F) in a position: (i) having signatory authority over third party funds or assets valued at $10,000 or more; or (ii) that involves a fiduciary responsibility to the employer with the authority to enter financial agreements valued at $10,000 or more on behalf of the employer.

(G) in a position with regular duties that allow the employee to modify digital security systems established to prevent the unauthorized use of the employer's or client's networks or databases.

Should you have any questions regarding this change, please do not hesitate to contact us at 877.70.GLOBAL (4-5622)