SENATE BILL No. 261
DIGEST OF INTRODUCED BILL
Citations Affected: IC 22-5-7.
Synopsis: Use of credit reports for employment purposes. Prohibits an
employer from using a credit report in the process of hiring a
prospective employee or in determining whether to continue the
employment of an employee. Provides that an employee or prospective
employee may bring a civil action against an employer for violating
this prohibition. Provides for an award of actual damages, court costs,
and attorney's fees to an aggrieved individual, along with an injunction
against the employer's further use of credit reports in violation of the
Effective: July 1, 2012.
Taylor, Simpson, Arnold, Breaux,
Broden, Hume, Lanane, Mrvan,
Randolph, Rogers, Skinner, Tallian,
January 4, 2012, read first time and referred to Committee on Pensions and Labor.
Second Regular Session 117th General Assembly (2012)
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SENATE BILL No. 261
A BILL FOR AN ACT to amend the Indiana Code concerning labor
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 22-5-7; (12)IN0261.1.1. -->
SECTION 1. IC 22-5-7 IS ADDED TO THE INDIANA CODE AS
CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY
Chapter 7. Prohibition Concerning the Use of Credit Reports
for Employment Purposes
Sec. 1. As used in this chapter, "credit report" means a written,
oral, or other communication of information by a consumer
reporting agency concerning the:
(2) credit standing; or
(3) credit capacity;
of a consumer.
Sec. 2. As used in this chapter, "trade secret" has the meaning
set forth in IC 24-2-3-2.
Sec. 3. (a) Except as provided in subsection (b), an employer
shall not use a credit report:
(1) in the process of hiring a prospective employee; or
(2) in determining whether to continue the employment of an
(b) An employer may use a credit report for employment
(1) the information contained in the credit report is
substantially job related in that the employment position or
prospective employment position of the individual for whom
the credit report is sought has access to:
(B) other assets; or
(C) trade secrets or other confidential information; or
(2) the employment position of the individual for whom the
report is sought is a:
(A) managerial position;
(B) position in the office of the attorney general created by
(C) sworn law enforcement position; or
(D) position for which the information contained in the
report is required to be disclosed by law or to be obtained
by the employer.
(c) This section does not apply to a person or business subject
(1) Sections 6801 through 6809 of the Fair Credit Reporting
Act (15 U.S.C. 1681 et seq.); or
(2) state or federal statutes or regulations implementing the
Sections referred to in subdivision (1);
if the person or business is subject to compliance oversight by a
state or federal regulatory agency with respect to the Sections
referred to in subdivision (1).
Sec. 4. (a) An employee or prospective employee may bring a
civil action against an employer to enforce section 3 of this chapter.
(b) In an action brought under subsection (a) in which an
employer is found to have violated section 3 of this chapter, the
court may do the following:
(A) actual damages; and
(B) court costs and reasonable attorney's fees;
to the prevailing employee or prospective employee.
(2) Enjoin the employer from committing further violations
of section 3 of this chapter.
Sec. 5. This chapter does not limit an employee's or prospective
employee's rights or remedies under any other state or federal law.