December 9, 2019

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New Puerto Rico Law Limits Employers’ Use of Credit Reports in Employment Decisions

Puerto Rico has enacted legislation to limit the use of credit reports in making employment decisions.

An “Act to Protect Employee’s Credit Information” (PR Act. No. 150 of October 8, 2019) prohibits employers from refusing to hire, dismissing, or otherwise discriminating against an employee or applicant because of the information in a credit report or on account of the employee’s credit history. The Act is effective immediately.

The new law also prohibits employers from verifying or obtaining the credit history information or credit reports of an employee or applicant.

Fines for violating this Act may range between $1,000 and $2,500 for each violation.

Exceptions

Credit reports may be obtained only for certain positions, including, for example:

  • Managerial positions;

  • Positions for which a credit report is required by law;

  • Positions that require access to financial or personal information of other persons and not the information usually provided for a purchase transaction;

  • Positions that require access to trade secrets (as defined by local law);

  • Positions that require a fiduciary responsibility to the employer; and certain positions that have regular access to cash or other goods.

Before requesting a credit report or credit history information from an employee or applicant who is covered by an exception, employers must obtain the employee’s written consent.

What Employers Should Do

  1. Puerto Rico employers should ensure they modify any practice of obtaining and using credit reports to comply with this new enactment.

  2. If use of a credit report is permitted, ensure written consent is obtained.

  3. Puerto Rico employers should modify any forms to ensure compliance with the Act.

  4. Multi-state employers should ensure compliance with the requirements of the federal Fair Credit Reporting Act and applicable state laws.

Jackson Lewis P.C. © 2019

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About this Author

Sara Colón-Acevedo, Jackson Lewis, wage hour lawyer, employment discrimination attorney, puerto rico courts legal counsel, administrative forum law
Shareholder

Sara E. Colón-Acevedo is a Shareholder in the San Juan, Puerto Rico, office of Jackson Lewis P.C. Her practice concentrates in employment discrimination and wage and hour law counseling and litigation on behalf of employers in Puerto Rico local and federal courts.

Ms. Colón-Acevedo has extensive trial experience before both federal and local courts and administrative forums in Puerto Rico. She also has experienced defending employers facing collective wage and hour class actions.

In her...

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Associate

Karla Carrillo Russe is an Associate in the San Juan, Puerto Rico, office of Jackson Lewis P.C. Her practice focuses on representing employers in workplace law matters, including preventive advice and counseling.

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