ARTICLE
29 November 2019

Puerto Rico Enacts Restrictions On Use Of Credit History In Employment

SS
Seyfarth Shaw LLP

Contributor

With more than 900 lawyers across 18 offices, Seyfarth Shaw LLP provides advisory, litigation, and transactional legal services to clients worldwide. Our high-caliber legal representation and advanced delivery capabilities allow us to take on our clients’ unique challenges and opportunities-no matter the scale or complexity. Whether navigating complex litigation, negotiating transformational deals, or advising on cross-border projects, our attorneys achieve exceptional legal outcomes. Our drive for excellence leads us to seek out better ways to work with our clients and each other. We have been first-to-market on many legal service delivery innovations-and we continue to break new ground with our clients every day. This long history of excellence and innovation has created a culture with a sense of purpose and belonging for all. In turn, our culture drives our commitment to the growth of our clients, the diversity of our people, and the resilience of our workforce.
Seyfarth Synopsis: With limited exception, Puerto Rico has joined the growing list of states that preclude an employer or prospective employer from procuring ...
Puerto Rico Employment and HR

Seyfarth Synopsis:  With limited exception, Puerto Rico has joined the growing list of states that preclude an employer or prospective employer from procuring an employee’s or applicant’s credit history and/or taking adverse employment action based on credit history.

On October 8, 2019, Puerto Rico Governor Wanda Vázquez Garced signed into law Act 150-2019 (the “Act”), which took effect immediately and prohibits employers (or potential employers) from:

  • denying or depriving an individual from receiving benefits or compensation, refusing to hire, refusing to promote, or discriminating against an employee or applicant based upon a credit history report;
  • verifying or investigating an employee’s or applicant’s credit history;
  • requesting or obtaining from a credit agency an employee’s or applicant’s credit report; or
  • taking adverse employment actions based on an employee’s or applicant’s credit history report.

The Act sets forth a list of positions that are exempt (but still require written consent from the employee or applicant), including, but not limited to:

  • management positions;
  • positions that have access to trade secrets (as defined under Puerto Rico law), financial or personal information, or cash or other goods subject to misappropriation totaling at least $10,000; or
  • positions for which a credit report is required by federal law.

Employers that violate the Act may be subject to penalties of up to $2,500 for each violation.

Employer Outlook

Covered employers located in Puerto Rico, and particularly multi-state employers, should ensure that their employment practices are in compliance with the Act, as well as continue to monitor developments in this and related areas of the law, including laws restricting the use of credit history information and applicable fair credit reporting laws.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More