In a clear harbinger for New Jersey, right next door, the City of Philadelphia has just joined 12 other jurisdictions in passing laws prohibiting public and private employers from using a person’s credit history to influence employment decisions. The Ordinance, enacted on July 7, 2016, and effective August 6, 2016, places “meaningful restrictions” on employers who in the past may have lawfully used certain financial information to affect their hiring, firing, promotion, and similar outcomes. New Jersey has not yet introduced legislation to restrict use of credit history in this way.  However, given the competitive employment marketplace in the Northeast and New Jersey’s desire to keep up commercially and culturally with its important neighbor to the west, such a legal step is almost inevitable.

The new Philadelphia Ordinance amends the “Fair Practices Ordinance: Protections Against Unlawful Discrimination”, which makes a public, private, or non-profit employer’s use of credit information a discriminatory employment practice.  Aspects of credit history protected by the new law include:

• Credit worthiness, standing, capacity, score or history;
• Written or oral communication of information regarding debt;
• Payment history;
• Charged-off debts;
• Bank account balances;
• Bankruptcies, judgments or liens; and
• Items under collection;

The new law specifies that an employer or prospective employer may not use any of the above types of information when considering a hire, or when making key employment decisions regarding a current employee.

There are some exceptions to the credit check law, including for those employees with responsibilities directly related to the finances of a company. If a Philadelphia employer routinely uses credit checks on prospective or current employees, it is important for each such company to determine if that practice is now illegal, or if the position qualifies as exempt.

Philadelphia employers who use discriminatory practices in hiring, promotion, and firing of employees are breaking the law. All employees or interviewees have the right to be considered, employed, and promoted on their merit and suitability for a specific job alone. As more jurisdictions join Philadelphia in adding credit information to the list of prohibited considerations, employers should be aware that the practice of routine credit history checks as part of the interview or hiring process is rapidly becoming increasingly unacceptable. New Jersey is likely to weigh in on these issues in the near future, although our current Governor is likely to be hostile to such proposals.  It will be up to the Legislature to decide whether to force the Governor’s hand, or overturn his veto.

All employees have the right to work in an environment free of harassment, discrimination, and retaliation, and with the full protection of the law. If you are facing a hostile work environment, whether based on discriminatory or retaliatory practices in the workplace, please remember:  you have rights.  You should contact an experienced employment law attorney for workers to help you navigate the law. Call Hanan M. Isaacs, P.C., at 609-683-7400 or contact us online today to schedule a near-term and reduced fee initial consultation.  We will investigate your facts, explain the law, and advise you how best to proceed based on your particular circumstances.  Call today.  You will be glad you did.