New Oregon Bill
Restricts Use of Credit
Reports
Oregon Senate Bill 1045
limiting the use of
Credit Reports for
employment screening was
originally set to go
into effect on July 1,
2010, has been signed
and made effective
immediately.
The act spells out that
"it is an unlawful
employment practice for
an employer to obtain or
use for employment
purposes information
contained in the credit
history of an applicant
for employment or an
employee, or to refuse
to hire, discharge,
demote, suspend,
retaliate or otherwise
discriminate against an
applicant or an employee
with regard to
promotion, compensation
or the terms, conditions
or privileges of
employment based on
information in the
credit history of the
applicant or employee."
This act does not apply
to employers who are
federally insured banks
or credit unions;
employers that are
required by state or
federal law to use
individual credit
history for employment
purposes; or for the
employment of public
safety officers.
The act does specify
that a credit report may
be used if, "The
obtainment or use by an
employer of information
in the credit history of
an applicant or employee
because of the
information directly
related to a bona fide
occupational
qualification that is
necessary to the
operation for the
employer's business and
the information in the
credit history has a
substantial relationship
to the functions and
responsibilities of the
position to which the
bona fide occupational
qualification applies."
In other words, the
law does not prevent an
employer from obtaining
an applicant's or
employee's credit report
as long as there is a
clear, bona fide
business necessity,
such as in positions
that include
access
to and/or responsibility
for business or personal
financial information,
check-writing or
credit/debit card
authority, or access to
valuables or large
amounts of cash.
This bill was introduced
in order to protect job
applicants and employees
who have been hurt
during the latest
economic down turn and
have credit problems
from being unemployed.
Although there were many
legislators who did not
agree with the passage
of this bill, it was
passed with a 33-26.
This
Oregon bill
is very similar to
the bill passed in
Washington State in
2007.
ESS has updated our
standard disclosure
and authorization
form to include the
language below. The
updated form is
available at
www.essclientservices.com
under Downloadable
Form.
Washington
and Oregon State
Residents:
A credit report
or other
information
regarding credit
worthiness,
credit standing,
or credit
capacity may be
obtained only if
such information
is legally
required or
substantially
job-related.
This includes
employment where
job duties
involve
access to and/or
responsibility
for business or
personal
financial
information,
check-writing or
credit/debit
card authority,
or access to
valuables or
large amounts of
cash.
Although years ago many
employers pulled credit
reports on all
employees, ESS
recommends that
regardless of state laws
credit reports only be
used for positions where
credit is directly
related to the position.
If you have questions
regarding this bill,
please feel free to
contact us at
info@employscreen.com.
