So what about credit checks? Employers were previously allowed to obtain credit checks on potential candidates for employment. With the new law the employer’s ability to obtain consumer credit reports for employment purposes is banned unless that potential employee meets certain criteria:
Labor Code section 1024.5, the person for whom the report is sought must be: (1) in a managerial position, as defined below; (2) in a position in the state Department of Justice; (3) in the position of a sworn peace officer or other law enforcement position; (4) in a position for which the information contained in the report is required by law to be disclosed or obtained; (5) in a position that involves regular access to specified personal information for any purpose other than for the routine solicitation and processing of credit card applications in a retail establishment; (6) in a position in which the person is or would be a named signatory on the employer’s bank or credit card account, or authorized to transfer money or enter into financial contracts on the employer’s behalf; (7) in a position that involves access to confidential or proprietary information (as specified); or (8) in a position that involves regular access to $10,000 or more of cash, as specified. “managerial position” is defined in the new law as an employee covered by the executive exemption set forth in Industrial Welfare Commission Wage Order 4, subparagraph 1 of paragraph A of Section 1, which applies to “persons employed in professional technical, clerical, mechanical and similar occupations.”
Before an employer can even request a consumer credit report they must give a written notice to the potential candidate of the exact reason as to why they are running the consumer credit report. See more about the new law by visiting the link below.
