New Credit Check Restrictions Could Expose Employers to Potential Liability
The Maryland Job Applicant Fairness Act, which recently took effect after being signed into law by Governor O’Malley last spring, now prohibits an employer from using a job applicant’s credit history or credit report in determining whether to hire an applicant, discharge an employee, or to “determine compensation or the terms, conditions, or privileges of employment.” The Act exempts some employers from the prohibition, such as certain financial institutions, companies required by federal or state law to conduct credit inquiries, and entities registered as investment advisors with the Securities and Exchange Commission. Notwithstanding, the vast majority of employers will be required to comply with the Act, which means that any employer who currently utilizes an employee or applicant’s credit history and reports in making employment decisions will have to cease doing so, or ensure that it only uses such information for employees or applicants that fall within the specific exceptions enumerated by the Act. Read more
Maryland Liability Insights 