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Senate bill would prohibit credit checks for employment purposes

February 26, 2014

Texas Employment Law Blog

Senate Bill 1837 , introduced by Elizabeth Warren and co-sponsored by six Democratic senators, would amend the Fair Credit Reporting Act to prohibit employers from using consumer credit checks for employment purposes.  The Fair Employment for All Act would even prohibit employers from checking credit with written authorization from applicants or employees, as currently allowed in most states.

Senator Warren has issued a press release arguing that credit history does not reflect job performance and is a better indicator of bad luck than bad character, particularly after the recession:

“A bad credit rating is far more often the result of unexpected medical costs, unemployment, economic downturns, or other bad breaks than it is a reflection on an individual’s character or abilities,” Senator Warren said.  “Families have not fully recovered from the 2008 financial crisis, and too many Americans are still searching for jobs. This is about basic fairness — let…

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