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Credit Checks
June 30, 2009
Chambers Take Action on Credit Report Reform Proposal
Employee theft is a growing problem. The U.S. Chamber of
Commerce rates the annual cost at $40 billion. According
to the Federal Bureau of Investigation, this is the
fastest growing crime in the United States and many
experts estimate that it increases at a rate of 15
percent annually. AB 943 is working its way through the
Legislature that will severely diminish an employer’s
ability to protect their business from this real threat.
“For any employer the risk created by AB 943 represents
a major liability that discourages business growth in
California,” stated Roger Ziemer, Chair of the Southwest
California Legislative Council. “For small businesses,
every little bit counts and it is their right and
responsibility to protect the business within reason.
This proposal unduly restricts the ability of businesses
to use all legally available information in employment
decisions,” continued Ziemer.
On average, businesses lose as much as two percent of
sales to employee theft. AB 943 prohibits employers from
using consumer credit reports for employment purposes
unless the information is “substantially job related,”
as defined, including positions that handle cash, other
assets, or personal information, and at least one of the
following conditions: managerial, municipal, sworn peace
officer or other law enforcement, or as otherwise
required by law. Moreover, language in AB 943 strongly
mirrors language from AB 2918 (2008) that was vetoed by
Governor Schwarzenegger.
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