Starting on April 18, 2026, New York is cracking down on employers using consumer credit information for hiring purposes. While there are some exceptions, these changes take requesting or using consumer credit history to make hiring decisions off the table for most employers.
What employers need to know about S3072
Earlier efforts to regulate credit report information in employment, such as the Stop Credit Discrimination in Employment Act, focused more on establishing employer guidelines and restrictions on the use of credit checks. Senate Bill S3072 revises the current New York State Fair Credit Reporting Act (FCRA), focusing on specifying and narrowing exceptions to using consumer credit history for employment purposes. Under this amendment, most employers in New York City are generally prohibited from using consumer credit history in making hiring, promotion, compensation, and other employment decisions.
Employer restrictions
Previously, employers could generally use credit information if it was determined to be job-related and necessary. S3072 expands restrictions to include employers, labor organizations, employment agencies, and their agencies in New York State that:
1: Request or use the consumer credit history of applicants and employees for employment purposes; OR
2: Use consumer credit history to discriminate or make decisions regarding hiring, compensation, and conditions of employment.
Exemptions
The amendment still allows room for exemptions in some scenarios.
- Regulations and laws that override S3072:
- Positions where credit checks are mandated under state or federal laws
- Appointed positions that legally require a background check and involve a high level of relevant public trust
- Positions that are legally required to be bonded
- Positions that require security clearance under federal law
- Some self-regulatory organizations are also exempt
- Government safety positions: Exceptions are made for safety roles such as peace and police officers, and other applicable government agency roles.
- Other roles with access to sensitive information: Some other roles that involve access to sensitive information, systems, and funds may apply, such as:
- Positions that include modifying digital systems
- Certain positions that are not clerical and require access to sensitive information, such as intelligence or national security information, and trade secrets
- Roles granted authority to enter into agreements or transfer assets or funds of $10,000 or more on behalf of an employer
In addition to expanding exempt categories, S3072 also provides definitions for further clarity, such as “trade secrets” and “intelligence information.”
Enforcement and violations
Employers that leverage any exemptions to use consumer credit information for hiring decisions are regulated by the New York State Division of Human Rights and are required to explain how and why an exemption was necessary. By April 18, 2028, the Division of Human Rights will submit its legislative report, summarizing how employers are leveraging exemptions to use credit report history in hiring.
Violations will be treated as unlawful discriminatory practices under Section 380‑b of the New York FCRA, granting applicants and employees a private right of action for negligent noncompliance. Unlike some other New York FCRA provisions, the section prohibiting credit history does not provide punitive damages for intentional noncompliance.
Navigating guidelines for roles that require credit checks in New York State
While S3072 still allows exceptions for specified circumstances where not running consumer credit checks may have amplified consequences, it narrows the circumstances in which employers are permitted, encouraging fairer and more mindful decision-making. Due to pre-existing federal and state laws, such as New York’s Stop Credit Discrimination in Employment Act, some employers may see few, or even no changes to their current employment and hiring practices.
The New York Division of Human Rights will monitor and document how employers are leveraging exemptions to screen for credit history, requiring careful review to ensure that credit checks meet the narrowed exceptions under S3072. For the full details of restrictions and exemptions in S3072, see the original legal text here. As always, employers should consult their legal counsel before taking any action.
This content is for informational purposes only and shall not constitute legal opinion or advice. Consult your legal counsel to ensure compliance.
