If your credit report is not perfect, you may worry that a hiring manager will see it and hold it against you. In Illinois, most employers are not allowed to do that, but a few jobs and employers are exceptions. Understanding these rules may help you recognize a problem and respond.
Illinois law bars most employers from checking your credit
Under the Illinois Employee Credit Privacy Act, most employers cannot ask about your credit history, order your credit report or refuse to hire you because of it. An employer also cannot make you give up these rights. If an employer violates the law, you may be able to sue in circuit court, and an employer that loses must pay your costs and attorney fees.
Some jobs and employers are exempt from the rule
The law does not apply to banks, insurance companies and certain government agencies, such as law enforcement units or agencies where the law requires credit checks. However, those employers still need your permission under federal law. Other employers can check your credit only when good credit is a legitimate requirement of the job, such as when the position involves:
- bonding that state or federal law requires
- unsupervised access to $2,500 or more in cash or marketable assets
- a managerial role that sets the business’s direction
- access to confidential financial information or trade secrets
If a job does not fit one of these situations, an employer generally cannot rely on your credit report when deciding whether to hire you.
Federal law still requires permission and notice
When an employer is allowed to check your credit, the federal Fair Credit Reporting Act requires the employer to obtain your written permission first. Before rejecting you because of information in the report, the employer must give you a copy of it and a summary of your rights.
After the decision, the employer must send a notice explaining how you can review the information and correct any errors. If the report contains an error, you may dispute it with the credit reporting agency.
Getting legal guidance after a credit check costs you a job
If an employer checked your credit when it should not have, or rejected you without the required notices, it may help to speak with an attorney. An attorney who handles credit report problems can review what happened and explain your options.
If a background check error is also involved, that may matter too. Understanding your rights may help you respond with confidence, whatever the outcome.