The new law defines “consumer credit history” in broad terms. It covers credit scores, late payments and even basic checks into how someone handles money. Under the update to N.Y. Gen. Business Law, using this data to deny a job, fire a worker or set pay is an unlawful practice.
While New York City has followed the Stop Credit Discrimination in Employment Act (SCDEA) for years, this change closes the gap for the rest of the state. Firms in the suburbs and upstate no longer have the freedom they once did.
Identifying the narrow exceptions for specific roles
The ban is not total, but the state enforces exceptions strictly. You can still run credit checks for roles that meet these specific marks:
- Financial authority: Roles with power over third-party assets worth $10,000 or more
- Legal requirements: Positions where state or federal law requires a bond or a credit check
- Digital security: Jobs that involve regular access to sensitive networks or trade secrets
- Law enforcement: Peace officers, police, or investigative roles within a legal agency
If a job does not fit these groups, a credit check likely breaks the new labor rules. Employers should review their current job descriptions to ensure they align with these categories.
Immediate steps to align your hiring workflow
Staying compliant takes more than just stopping a search. You need to update your HR files and systems.
- Update applications: Remove questions that ask for consent to check credit unless the job is exempt.
- Notify vendors: Give your background check partners a clear list of roles that no longer allow credit pulls. This stops them from sending accidental reports.
- Document exceptions: For exempt jobs, keep clear notes on why the role qualifies for a check under the law.
Reviewing these procedures now ensures your company is ready when the law takes effect.