Credit Checks In California Now Tougher Than Ever


Effective January 1, 2012, California employers will have to avoid yet another potential legal hazard that haunts businesses with the threat of costly penalties: the unauthorized use of consumer credit reports regarding job applicants and current employees.

Currently, pursuant to the California Consumer Credit Reporting Agencies Act, employers can request a consumer credit report (i.e., a report obtained from a consumer credit-reporting agency bearing on an individual's credit worthiness, credit standing, or credit capacity) for purposes of evaluating an applicant or employee for employment, reassignment, or retention. But starting next year a valid reason for obtaining a consumer credit report should be viewed as being the exception rather than the rule.

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Topics:  Credit Checks, Employee Credit Checks, Job Applicants, Penalties

Published In: Administrative Agency Updates, Finance & Banking Updates, Labor & Employment Updates, Privacy Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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