DC mayor signs act prohibiting employer use of an employee’s credit information.
On February 16, the mayor of the District of Columbia signed the DC Fair Credit in Employment Amendment Act of 2016 (the Act). The Act amends the DC Human Rights Act by prohibiting employers from discriminating against employees and applicants based on an individual’s credit information. The Act must now proceed to the US Congress for a 30-day review period.
Pursuant to the Act, it is unlawful for DC employers, employment agencies, or labor organizations to ask employees or applicants for credit information or to use, accept, refer to, or inquire about their credit information. Under the Act, “inquire” includes direct or indirect conduct such as obtaining credit information in application forms, credit history checks, or interviews.
The Act provides several exceptions to the prohibition, including in the following scenarios:
Under the Act, an individual may file an administrative complaint with the DC Office of Human Rights for an alleged violation of the Act. An employer found to have violated the Act by the Commission on Human Rights will be directed to cease and desist from the unlawful discriminatory practice and pay the complainant a fine of $1,000 for the first violation, $2,500 for the second violation, and $5,000 for each subsequent violation. Moreover (and as with any other alleged discrimination under the DC Human Rights Act), an individual also retains a private right of action for violations of the Act.
Now that the Act has been signed by the mayor, the final step in the legislative process includes a mandatory 30-day congressional review period. Because Congress has the ability to block implementation of the Act, the Act’s effective date is still unclear.
If the Act becomes law, DC will join an increasing number of jurisdictions—including California and New York City—that have begun limiting or prohibiting employer use of an employee or job applicant’s credit information. As such, employers that use credit checks as part of their employment process should review their employment applications for compliance with these requirements and discuss this recent development with any third-party vendors that may perform these functions.
If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:
 The DC Human Rights Act includes unpaid interns and individuals seeking employment under the definition of “employee.”