New York State has recently amended the New York State Fair Credit Reporting Act. These amendments have added several new restrictions on the use of employee/applicant credit information by an employer.

The new regulations make it unlawful for an employer to request an employee’s consumer credit history or rely on such information in any way when making a hiring decision. The law defines “consumer credit history” as “an individual’s credit worthiness, credit standing, credit capacity, or payment history, as indicated by: (1) a consumer credit report; (2) credit score; or (3) information an employer obtains directly from the individual regarding (i) details about credit accounts, including the individual’s number of credit accounts, late or missed payments, charged-off debts, items in collections, credit limit or prior credit report inquiries, or (ii) bankruptcies, judgments or liens.”

This new regulation is set to take effect on April 18, 2026. There are exceptions to this prohibition, but they are narrowly tailored and mostly exist to allow state/federal employment agencies to perform mandatory background checks unimpeded. Employers should amend their hiring procedures to ensure that credit checks do not factor into the decision-making process.

You can read the entire law HERE.