RAP helps introduce NYC bill to end job discrimination based on credit

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April 10, 2014
For Immediate Release
Contact: Darrah Sipe
darrah@retailactionproject.org
Phone: 646.490-5925

NEW YORK, N.Y. - Today, Retail Action Project (RAP) members rallied around City Councilmembers Brad Lander and Deborah Rose, who re-introduced a bill making it illegal to discriminate against job candidates based on their credit histories. The bill also restricts the use of credit checks for any promotion, demotion, or compensation decisions. RAP is a part of the NYC coalition to stop credit checks in employment.

“Employers should not deny people jobs based on their credit history,” said Councilmember Brad Lander. “Whether from catastrophic medical expenses, death of a spouse, or predatory lending, many New Yorkers have poor credit through little or no fault of their own.  Recent graduates with spiraling student debt need an equal chance to get a job, if they are ever going to pay it off.  This bill is a step forward for fairness, and for common sense.”

With so many New Yorkers out of jobs, a hiring practice that makes obtaining jobs even harder is not economically or socially responsible. Getting more New Yorkers back to work will also help the city and the state to increase economic growth.

Why is credit history discrimination unfair and bad for the economy?

  • Credit Catch-22:  Credit history discrimination puts many New Yorkers in a Catch-22: denied a job due to bad credit and unable to pay off debts because they are out of work.
  • No connection to job performance:  Nationally, over 50% of employers use credit checks to evaluate employees, even though no connection has been shown between poor credit and job performance.
  • Discriminates against people of color and low income New Yorkers:  Not only does this practice block eligible New Yorkers from much needed jobs, but it also disproportionately impacts applicants from low-income communities who were hardest hit by the economic downturn, and can be a used as a means to discriminate against applicants of color.
  • Credit histories are error-ridden:  Credit histories often contain errors and false or invalid information about an individual. Studies have shown that as many as 25% of all credit reports contain errors.
  • Poor credit can often be tied to very personal events that are, in many cases, outside of one’s control. Expensive medical bills, predatory lending, divorces, identity theft, a death in the family, and the loss of a job can all lead to bad credit, but are not the result of poor financial decisions or an indicator of personal responsibility. Not only should these occurrences have no influence on hiring decisions, but job applicants should not be made to explain their poor credit histories if they are tied to private or delicate situations.
  • Punishes students who had to borrow for college:  Recent graduates who are unable to find employment after school—which is increasingly common in the current job market—may also have poor credit if they are unable to pay back their student loans.
      “I went to college to open up career opportunities for me. Instead, the massive debt I incurred from my student loans is now barring me from getting jobs from employers who do credit checks. My credit report does not reflect the fact that I’m a determined worker with a stellar performance record. It just shows that I’m in debt.” –

Onieka O’Kieffe, member of the Retail Action Project.

“I had a bankruptcy a couple of years ago. I was between jobs…I had no insurance and got an injury. After that, I was turned down for many jobs that I was well qualified for only as a result of my medical bankruptcy. It is unfair. Qualified people are being turned away from jobs all over the City only because of credit checks,” said Alfred Carpenter, member of the NYC Coalition to Stop Credit Checks in Employment.”Employers should hire based on education and experience, not credit history.

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