UPDATE: Treasury Department Issues Highly-Anticipated Proposed Regulations on Opportunity Zones https://t.co/UvNS5Eb0HV
Tax law attorney Gene Chianelli analyzed the Treasury Department's proposed regulations on Opportunity Zones. Here'… https://t.co/PYx1ZBztwB
UPDATE: Treasury Department Issues Highly-Anticipated Proposed Regulations on Opportunity Zones - by @TheRealEWC -… https://t.co/v3PWiglQKq
Senator Elizabeth Warren (D-Mass.) introduced the Equal Employment for All Act in December, which would prohibit the use of consumer credit checks in most employment decisions. In her fact sheet introducing this legislation, Senator Warren reasoned that there is no evidence to suggest that credit is an indicator of one’s work ability, that errors in credit reports are common and, in many cases, difficult to correct, and that bad credit keeps struggling families out of the workforce, worsening their financial circumstances. Senator Warren opines in the related press release that 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. . . . let people compete on the merits, not on whether they already have enough money to pay all their bills.”
The Equal Employment for All Act proposes to amend the Fair Credit Reporting Act to prohibit employers from requiring or suggesting that applicants disclose their credit history, and from procuring a consumer or investigative report. If passed, this Act would also prohibit employers from making adverse employment decisions with regard to their employees on the basis of a poor credit rating or information on the employee’s creditworthiness, standing or capacity. The bill includes exceptions for situations in which the applicant applies for, or currently holds, employment that requires a national security clearance or situations in which an employer is required by law to use a consumer report with regard to an applicant or employee. However, the bill provides that these exceptions would not change the current disclosure and notification requirements to a consumer when such a permissible use of a consumer report occurs in an employment context.
Notably relevant to the current legislative activity was the October 2009 lawsuit by the Equal Employment Opportunity Commission (EEOC) against the Freeman Companies, a nationwide convention, exhibition, and corporate events marketing company, in which it alleged that Freeman’s hiring process had a disparate impact on minorities. The EEOC claimed that in violation of Title VII of the Civil Rights Act, Freeman unlawfully “rejected job applicants based on their credit history” and whether they have had “one or more of various types of criminal charges or convictions.” In August of 2013, however, a Maryland federal court dismissed that lawsuit. While the court conceded that “some specific uses of criminal and credit background checks may be discriminatory and violate the provisions of Title VII,” it ruled that the EEOC had failed to demonstrate that credit checks have a disparate impact on any protected class of employees or applicants.
Until this proposed legislation is passed, which appears unlikely at this time, it remains prudent practice for employers to continue the use of credit checks for positions in which financial responsibility is paramount, or in which access to confidential information is a part of the essential functions of the position.
If you have questions or concerns about this proposed legislation or other legal issues, please feel free to contact Connie Carrigan at firstname.lastname@example.org
Connie Elder Carrigan is a partner in the firm, with a practice concentration in Business Law. Her focus is assisting clients with issues regarding employment law, business advice and litigation, construction law, equipment leasing and creditor bankruptcy. Connie has lectured on topics ranging from employment law, bankruptcy, and equipment leasing to construction law....LEARN MORE