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Schwarzenegger vetoes applicant credit report ban

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in Employment Background Check,Human Resources

Gov. Arnold Schwarzenegger has vetoed A.B. 482, a bill that would have prevented employers from using consumer credit reports when performing background checks on employees and applicants. (See “Strike 3 for bill banning applicant credit checks?” )

The bill would have prohibited most California employers from using a consumer credit report unless the information obtained is “substantially job-related.” Credit checks would have been allowed only for positions involving access to the employer’s money, assets, trade secrets or other confidential information.

This was the third time in three years that Schwarzenegger has vetoed a bill prohibiting employers from using credit reports for employment background checks.

In his veto message, Schwarzenegger said, “As with the last two bills, this measure would also significantly increase the exposure for potential litigation over the use of credit checks.”

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