Would a history of late or non-payment on a person’s credit report, as reported by debt collectors, affect your decision to hire that person? If so, you are part of the reason the New York State Legislature is seeking to ban the use of credit reports in employment decisions.
Lenders, landlords, and employers frequently use the data reported to credit bureaus for a variety of decisions. Due to the overwhelming volume of debt in the U.S. and the potential inaccuracies in reporting, New York and other states have taken steps to limit how this information is used.
In 2023, New York’s governor banned hospitals, health care professionals, and ambulance companies from reporting medical debt to credit agencies. The reasoning was that the reporting of medical debt disproportionately affected underserved populations.
CFPB Director Rohit Chopra stated, “Medical bills on credit reports too often are inaccurate and have little to no predictive value when it comes to repaying other loans.”
In January 2025, the Consumer Financial Protection Bureau finalized a rule to remove medical bills under $500.00 from credit reports.
New York’s New Bill
Now, the New York State Legislature is taking it a step further. Already passed by the Senate and awaiting the governor’s signature, Senate Bill S3072 proposes an amendment to the New York General Business Law. The bill would prohibit the disclosure or use of a person’s consumer credit history by employers, labor organizations, employment agencies, or their agents for employment decisions.
According to Experian, one of the three main credit reporting agencies, describes what typically appears on an individual’s credit report as “information about you and your account history with credit cards and loans.” This includes personal information, accounts, collections, credit inquiries, and public records.
More specifically, as it relates to payments and debt repayment, credit reporting agencies provide details such as:
Payment history status (e.g., current, or how many times paid late)
Dates of late payments
Last reported payment date
Past due amount
Current monthly payment amount
Senate Bill 3072, introduced by NYS Senator James Sanders Jr., is meant to offer individuals with past credit challenges a second chance at meaningful employment. “Your credit report should not determine your career,” said Senator Sanders. “This bill recognizes that life happens—people face medical emergencies, family crises, and economic downturns. Those challenges should not follow you into a job interview. With this legislation, we’re restoring fairness to the hiring process and opening the door to opportunity for thousands across the state.”
Will these limitations on the use of credit reports affect your hiring and employment decisions? We’d love to hear from you! Share a comment below and let us know your thoughts.
