New York Background Check Change Effective April 2026

Paula Fulghum • April 30, 2026

Changes Below

A major shift is coming to hiring practices in New York—and it’s going to impact how employers think about background checks.


Starting April 18, 2026, New York significantly restricted the use of credit reports in employment decisions, expanding protections that were previously limited to New York City across the entire state.


If your organization operates in New York—or hires employees there, this is a change you can’t afford to overlook.


What’s Changing?


Under the updated New York State Fair Credit Reporting Act:


  • Employers are generally prohibited from requesting or using credit history
  • This applies to decisions involving:
  • Hiring
  • Compensation
  • Promotions
  • Discipline
  • Any terms of employment


Credit history includes:


  • Credit reports and scores
  • Payment history
  • Bankruptcies, liens, or judgments
  • Even information shared directly by the candidate about their finances


Credit checks are no longer a standard hiring tool in New York.


Why This Change Matters


This law reflects a broader national shift away from using financial history as a proxy for job performance.

Research and policymakers have increasingly questioned whether credit history has any meaningful connection to how someone performs at work.

New York now joins a growing list of states limiting or banning this practice altogether.


For employers, this means:

  • Rethinking traditional screening processes
  • Ensuring hiring practices are job-related and defensible
  • Reducing risk of discrimination claims tied to financial history


Are There Any Exceptions?


Yes—but they are narrow and specific.


Certain roles may still allow credit checks, including positions that:

  • Have significant financial authority
  • Require access to sensitive financial data
  • Are subject to regulatory or legal requirements

However, employers must be able to clearly justify why a credit check is directly related to the job responsibilities.


What Employers Should Do Now


1. Review Hiring Practices

Remove any credit check requirements from:

  • Applications
  • Background screening processes
  • Internal hiring policies


2. Train Hiring Managers

Ensure your team understands:

  • What can and cannot be asked
  • How to evaluate candidates without financial bias


3. Update Vendor Relationships


Confirm your background screening providers are:

  • Compliant with New York law
  • Not automatically including credit reports


4. Document Exceptions Carefully


If you believe a role qualifies for an exception:

  • Clearly define the justification
  • Maintain documentation 

Spread the word!

By Paula Fulghum June 16, 2026
After more than 25 years in Human Resources, I’ve watched South Carolina transform.
By Paula Fulghum June 12, 2026
One thing has always fascinated me about manufacturing. Manufacturers are masters of efficiency. They invest millions in automation, robotics, lean processes, quality systems, and continuous improvement. They’re constantly looking for ways to produce more, reduce waste, improve accuracy, and scale operations. And it works. Yet when it comes to HR, I often see a completely different mindset. Many manufacturers still rely on highly manual processes for onboarding, benefits administration, payroll changes, time-off requests, and employee communication. As an HR professional who has spent years working with manufacturers across South Carolina, I’ve often wondered why. The same company that can automate a production line to improve efficiency by 20% may still be handing out paper forms during orientation. The same organization that uses sophisticated technology on the shop floor may still be relying on manual HR processes that create delays and frustration for employees. What’s interesting is that today’s manufacturing workforce is more connected than ever. Nearly every employee has a smartphone in their pocket. They expect the same convenience in managing their employment information that they experience in every other aspect of life. This doesn’t mean people aren’t important. In fact, I believe the opposite. Technology should handle the transactions so HR professionals can focus on the relationships. Instead of spending time processing forms, answering routine questions, or entering data, HR can focus on engagement, retention, leadership development, workforce planning, and supporting employees where it matters most. The manufacturers that will win the talent battle in the next decade won’t just automate production. They’ll modernize the employee experience as well. What are your thoughts? Why do you think manufacturing has embraced automation on the production floor faster than it has in HR? #Manufacturing #SouthCarolinaManufacturing #HumanResources #WorkforceDevelopment #OperationalExcellence #EmployeeExperience #Leadership #SouthCarolinaBusiness #HRTechnology #InnovateHR
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We have clients in multiple industries with their own unique cultures and operational structures. We respect and honor that. We report to our clients and don’t accept commission from insurance providers.

Contact Information

A black phone icon.

864.541.7809

info@innovatehr.com

PO Box 8871 Greenville, SC 29604

Hours of Operation

Monday - Friday: 8:30am-5:00pm

Social Media

© 2018-2025 innovateHR™

Website Design by Wonder

We have clients in multiple industries with their own unique cultures and operational structures. We respect and honor that. We report to our clients and don’t accept commission from insurance providers.

Social Media

Contact Information

Hours of Operation

A black phone icon.

864.541.7809

info@innovatehr.com

PO Box 8871 Greenville, SC 29604

Monday - Friday: 8:30am-5:00pm

@ 2018-2025 innovateHR™

Website Design by Wonder