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Philadelphia, PA Bans Use of Credit Information in Employment Decisions

Effective as of July 7, 2016, amendments to the Philadelphia, PA Fair Practices Ordinance make it an unlawful discriminatory practice for an employer to procure, seek to procure, or use an applicant’s or employee’s credit information in connection with making any decisions relating to an individual’s hire, discharge, tenure, promotion, discipline, or in consideration of any other term or condition of employment.

For purposes of this ordinance, “credit information” is defined as any written, oral, or other communication of information regarding a person’s debt; credit worthiness, standing, capacity, score or history; payment history; charged-off debts; bank account balances or other information; or bankruptcies, judgments, liens, or items under collection.

Financial institutions – defined as any bank, savings and loan association, credit union, trust company, insurance or surety company, bank holding company, financial holding company, investment advisor, broker-dealer, entity registered with the U.S. Securities and Exchange Commission, or any subsidiary or affiliate thereof – are exempt from the law’s requirements, as are law enforcement agencies. Additional exceptions exist if credit information must be obtained under federal or state law, or if the position in question:

  • is supervisory or managerial in nature and involves setting the direction or policies of a business or a division, unit or similar part of a business;

  • involves significant financial responsibility to the employer, including the authority to make payments, transfer money, collect debts, or enter into contracts (but not including handling transactions in a retail setting);

  • requires access to financial information pertaining to customers, other employees, or the employer, other than information customarily provided in a retail transaction;

  • requires access to confidential or proprietary information that derives substantial value from secrecy;

  • requires an employee to be bonded under city, state or federal law.

The ordinance further provides that if an employer intends to rely, in whole or in part, on credit information to take adverse employment action under any of the above-bulleted exceptions, the employer must first: (i) disclose the fact of such reliance in writing to the applicant or employee; (ii) state the particular information relied upon; and (iii) must further provide the applicant or employee with an opportunity to explain the circumstances surrounding the information at issue prior to taking any adverse action.

© 2019 Proskauer Rose LLP.


About this Author

Wanda L Ellert, Labor Employment Attorney, Proskauer Rose, Law Firm
Senior Counsel

Wanda L. Ellert, a Senior Counsel in the Labor & Employment Law Department, is located in the New Jersey office. She has practiced labor and employment law for over 20 years.

Wanda has represented management in all facets of labor and equal employment opportunity law. She has litigated employment lawsuits in state and federal courts based on race, sex, age, national origin, disability and religious discrimination; sexual, national origin and age harassment; whistle-blower retaliation; family and medical leave laws; employment contracts;...

Laura M. Fant, Labor & Employment Attorney, Proskauer Law Firm

Laura M. Fant is an Associate in the Labor & Employment Department, resident in the New York office. She is a member of the Accessibility and Accommodations Practice Group, and frequently counsels on matters involving the Americans with Disabilities Act (ADA) and state public accommodation law, as well as disability accommodation in the workplace. She has experience conducting accessibility audits and providing ADA and accessibility training for clients in a variety of sectors, including retail, sports, and not-for-profit. Her practice also focuses on wage and hour and class and collective action litigation, and she is a frequent contributor to the Proskauer on Class and Collective Actions blog.