Discrimination Based on Credit Information Is Now Prohibited in Washington, D.C.


credit informationDespite what you might think, not every type of discrimination is actually illegal. If an employer tells an employee she’s fired because the company doesn’t like her religion, is that legal? No, because a law specifically prohibits discrimination based on religion.

But if an employer fires an employee because the employer doesn’t like the color of the shirt the employee is wearing, that’s perfectly legal. No law prohibits discrimination based on the color of an employee’s shirt.

In most workplaces in the United States, discrimination based on an individual’s credit score or credit history is legal. Generally speaking, laws have not specifically prohibited discrimination on that basis. However, this is about to change in Washington, D.C.

The Fair Credit in Employment Amendment Act

D.C. Mayor Muriel Bowser recently signed the Fair Credit in Employment Amendment Act (the Credit Act), which prohibits employers from using credit information about a job applicant or an employee for employment purposes. The Credit Act amends the existing D.C. Human Rights Act of 1977 to include the credit information as a protected class characteristic.

A protected class is a group that has special legal protection based on a characteristic that all the individual members of the group share. In the case of the Credit Act, the shared characteristic that is protected is the individuals’ credit information.

Washington, D.C., now joins the following states and municipalities with similar laws:

  • Chicago
  • New York City
  • Philadelphia
  • California
  • Colorado
  • Connecticut
  • Delaware
  • Hawaii
  • Illinois
  • Maryland
  • Nevada
  • Oregon
  • Vermont
  • Washington

Let’s look at some of the specific provisions of the Credit Act.

Prohibitions of the Credit Act

credit informationThe Credit Act makes it illegal for an employer to ask, obtain, or use credit information about its current or prospective employees. This means that an employer cannot discriminate against a current or prospective employee based on that person’s credit information. It doesn’t matter how the employer gets the individual’s credit information—it cannot be used for employment purposes regardless of its source.

The Credit Act applies to all Washington, D.C., employers, employees, and prospective employees. However, it doesn’t appear to apply to independent contractors. The Credit Act’s prohibition on credit information discrimination also doesn’t apply in these specific situations:

  • when another D.C. law requires an employer to obtain the employee’s credit information;
  • when an individual is applying for a job as a police officer;
  • for employees in the Office of the Chief Financial Officer of the District of Columbia;
  • when credit information must be considered under another D.C. law as part of obtaining a particular security clearance;
  • when a D.C. government employee provides his or her information to the Board of Ethics and Government Accountability or to the Office of the Inspector General;
  • within financial institutions, for positions that require handling and accessing the personal financial information of others; or
  • when an employer is asking for an employee’s credit information in accordance with a law enforcement investigation, court order, or subpoena.

Enforcement of the Credit Act

If a violation of the Credit Act occurs, the D.C. Office of Human Rights may levy a fine on the employer in the amount of $1,000, $2,500, or $5,000, depending on how many times the employer has violated the law.

Victims of credit information discrimination can also file a complaint with the D.C. Office of Human Rights or sue the employer directly in D.C. Superior Court. Employees who win their cases are eligible for any damages that are deemed “appropriate.”

For more information about enforcement of the Credit Act, please read our blog post on the “Five Things You Should Know About the D.C. Human Rights Act.”

Summing It Up

  • The Fair Credit in Employment Amendment Act prohibits employers from discriminating against employees and job applicants based on their credit information.
  • Employers who violate this law are subject to civil liability if the victim of credit information discrimination sues his or her employer or potential employer. Fines may also be imposed if the D.C. Office of Human Rights concludes that an employer violated the law.

Have you been discriminated against based on your credit information? Does your state or city have a law prohibiting that discrimination? Please contact our office so we can help you understand your rights and figure out what to do next.