New Philadelphia Law Prohibits Employers From Using Credit Information Of Employees And Job Seekers

Written by ESR News Blog Editor Thomas Ahearn

The Philadelphia Order No. 160072 (PA) which came into effect on July 7, 2016, amends Chapter 9-1100 of the Philadelphia Code titled “Fair Practices Ordinance: Safeguards Against Unlawful Discrimination,” by adding a section that prohibits employers from obtaining or using credit information regarding employees and job seekers under certain conditions.

Signed by Mayor of Philadelphia Jim Kenney, Ordinance No. 160072 prohibits employers from using the credit information of candidates or Philadelphia employees – with some exceptions – for employment decisions such as hiring, firing, or promotion. “Credit information” is defined as any written, oral or other communication concerning:

  • Debt;
  • Creditworthiness, reputation, capacity, score or history;
  • Payment history;
  • Write-off debts;
  • Bank account balances or other information; Where
  • Bankruptcies, judgments, liens or other items in the process of collection.

However, Order No. 160072 prohibiting the use of credit information of job seekers and employees in Philadelphia by employers will not apply in the following exceptions:

  • To any law enforcement agency or financial institution;
  • To the City of Philadelphia with respect to efforts to obtain information regarding taxes or other debts owed to the City;
  • Whether this information is to be obtained under federal or state law;
  • Whether the job requires an employee to be bonded under city, state, or federal law;
  • If the work is of a supervisory or managerial nature and involves setting the direction or policies of a company or a division, unit or similar part of a company;
  • If the work involves significant financial responsibility for the employer, including the authority;
  • If the job involves significant financial responsibility to the employer, including the power to make payments, transfer money, collect debts or enter into contracts, but not including managing transactions in an establishment sale to detail ;
  • If the work requires access to financial information relating to customers, other employees or the employer, other than information usually provided in a retail transaction; Where
  • Whether the work requires access to confidential or proprietary information which derives substantial value from the secrecy.

By law, if an employer relies on credit information to consider adverse employment action against a person, and certain paragraphs of the law apply, the employer :

  • must disclose the fact of such trust to the person in writing and identify and provide the particular information on which the employer relied; and
  • Give the employee or candidate the opportunity to explain the circumstances surrounding the information in question before taking such adverse action.

As previously reported by ESR News, the National Financial Educators Council (NFEC) conducted a survey of 1,100 workers which found that 5.2 percent of respondents said they had been turned down for jobs because of their credit information, while 26.3 percent said employers performed credit checks. their credit history.

Besides, ESR News also reported that Harvard University published a study on credit check bans by employers aimed at helping job seekers with bad credit find work found that people with average to low credit scores, those under 22, and African Americans were more likely to be unemployed due to of these laws.

More information on ESR credit reports

Job Screening Resources® (ESR) is a global provider of fast, accurate, affordable and compliant background check services for employers. The ESR is audited annually for SSAE 18 SOC 2® Type 2 compliance. To read more blogs on how employers use credit reports during the hiring process, visit

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