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Massachusetts Sets to Ban Credit Checks in Hiring

Massachusetts Sets to Ban Credit Checks in Hiring

Massachusetts is on the verge of enacting a groundbreaking law that would prohibit the use of credit reports in employment decisions. The legislation, titled An Act Reducing Barriers to Employment Through Credit Discrimination (H.1434), has passed the House and is expected to be signed into law soon, with an effective date of January 1, 2025. This law would prevent employers from using individuals' credit histories for hiring, promotions, or retention. It would still allow other forms of background checks but sets the stage for Massachusetts to have the strictest credit reporting restrictions in the U.S. Employers would need to adapt their hiring practices and documentation to comply with the new requirements, which include an anti-retaliation provision to protect employees' rights.

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