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Credit Checks Measure Advances In N.J. Legislature

TRENTON, N.J. (AP) — Legislation that would restrict New Jersey employers from requiring job applicants to submit to credit checks before they are hired may soon come before the full Assembly.

The measure would bar such checks unless the employer is legally required to conduct them or they’re needed due to the position being sought. Employers also would be allowed check the credit of prospective employees who they reasonably believe may have been involved in financial crimes such as embezzlement or fraud.

If the bill becomes law, employers who are caught improperly checking applicants’ credit could be fined $5,000 for an initial violation, and $10,000 for each subsequent violation.

The Assembly’s labor committee approved the measure on Oct. 14. A full Assembly vote has not been scheduled. Sen. Nia Gill, D-Essex, has introduced an identical bill. It has been referred to the Senate’s labor committee.

“Let’s face it — in most cases credit checks are unnecessary and say nothing about whether a potential employee is fit for the job,” said Assemblyman Ruben J. Ramos Jr., D-Hoboken. He’s sponsoring the Assembly bill with fellow Democrat Cleopatra Tucker of Newark.

Under the proposed measure, credit checks for potential new hires would be barred except for:
— Officers and investigators with law enforcement agencies in the state.
— Management positions that involve setting a firm’s financial direction or control.
— Positions involving access to the valued possessions or financial information of customers, other employees or employers (except for information customarily provided in a retail transaction).
— Positions involving fiduciary responsibility to the employer — including the authority to issue payments, transfer money or enter into contracts — or involving property leases.
— Positions that provide expense accounts for travel.

The measure also would bar employers from requiring job seekers to waive or limit protections granted under the bill as a condition of applying for a job or receiving an offer.

“The bill doesn’t prevent an employer from a credit inquiry or employment action if credit history is a bona fide occupational requirement of a particular position or employment classification,” Tucker said. “Otherwise, requiring such checks may actually be impairing someone’s ability to recover financially by starting a new job.”

(Copyright 2010 by The Associated Press.  All Rights Reserved.)