On Sept. 8, the California Legislature sent AB 22 to Gov. Jerry Brown for his signature or veto. Similar in substance to bills former Gov. Arnold Schwarzenegger repeatedly vetoed during his administration, AB 22 would add a new provision to the California Labor Code and amend the state’s Consumer Credit Reporting Agencies Act (Civ. Code §1785, et seq.) to limit when employers lawfully can use “consumer credit reports” and impose specific notice and disclosure obligations on employers who intend to do so. If signed by Gov. Brown, AB 22 would take effect Jan. 1, 2012.
The Requirements of the New Law
New Labor Code §1024.5 would limit when private and public sector employers, except for financial institutions, lawfully can use consumer credit reports for employment purposes. Specifically, employers would be permitted to use consumer credit reports only if the individual is applying for or works (or would work) in the following positions:
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