Illinois Law on Employer Use of Credit Information

Illinois prohibits employers from considering credit history for most positions.

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Illinois is one of a handful of states that limit the circumstances in which employers may use credit reports in making employment decisions. Like employers in other states, Illinois employers must follow the notice and authorization requirements of the federal Fair Credit Practices Act (FCRA), to make sure applicants and employees know when their credit reports are used and have an opportunity to correct errors in those reports. (For more information on what the FCRA requires, see our article Can Prospective Employers Check Your Credit Report?)

In Illinois, however, employers may not check an applicant’s or employee’s credit report or consider credit history in making job decisions, except in limited situations.

Illinois Ban on Using Credit Information

Illinois employers may not fire, refuse to hire, or discriminate against anyone in compensation or other terms, conditions, or privileges of employment based on that person’s credit report or credit history. Credit history refers to a person’s past borrowing and repayment activities, including whether the person pays bills on time and how he or she manages debt and other financial obligations.

Employers in Illinois are also prohibited from checking an applicant’s or employee’s credit report and from inquiring about credit history.

Exceptions for Certain Employers and Employees

Although Illinois has generally banned employer use of credit history, there are a handful of exceptions for employees who will have certain financial responsibilities. An employer may require an applicant or employee to have a satisfactory credit history if any of these exceptions applies:

  • Federal or state law requires bonding or other security for the person holding the position.
  • The position requires custody of, or unsupervised access to, at least $2,500 in cash or marketable assets.
  • The duties of the job include signatory power for business assets of at $100 or more per transaction.
  • The position is managerial, and involves setting the direction and control of the business.
  • The position requires access to personal or confidential information, trade secrets, financial information, or state or national security information.
  • The position meets any other criteria set forth in federal or state regulations for which credit information is a bona fide occupational qualification.
  • The person’s credit history is either required or exempt under federal or state law.

In addition, Illinois law doesn’t cover certain employers. These exempt employers, which include financial institutions, insurance companies, debt collectors, and law enforcement agencies, may consider credit information without violating the law.  

by: , J.D.

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