An Appellate Court (Illinois) has again highlighted to employers how fraught the background credit check process remains. The court found Neiman Marcus had compromised it’s background check process by subjecting sales associate applicants to a credit check. The case ( Ohle v The Neiman Marcus Group ) puts forward that an offer of employment was rescinded following a background credit check. The check revealed collections and judgements registered. Ohle had brought the case as a result of the company carrying out the check on an entry level position of sales associate. It is claimed that Neiman Marcus therefore violated the Illinois Employee Credit Privacy Act (the “Act”). The First District Appellate Court had agreed.

The Act bars employers access to the credit history of an applicant. Subject to exceptions a background credit check may be permissible. Exceptions total seven but Neiman Marcus chose to identify three. The first being access to assets with a value of $2,500 or more. Signatory authority to assets over £100 per transaction and access to confidential or personal information. The first two points were dismissed based on history and statute language. The court therefore chose to analyze the third exception. This being access to confidential and personal information by Ohle.

Neiman Marcus had argued that by processing customer’s credit card applications their confidential and personal information was a “accessible”. As per the majority of credit card applications certain personal information was volunteered. These details were names, social security details and addresses. The Circuit Court judge had found in favor of Neiman Marcus however the retailer’s stance was rejected by The Appellate court citing “access” as too vague and in practice the information was minimal. The role of sales associate involved accepting the relevant information and processing it to the credit office or manager/s. Alternatively securing applications within a secure box in a cash register. The Appellate Court took note that the role was no more than a ‘conduit’ that the information passed through and under the Act it did not constitute access.

This case confirms to employers that not all applicants should be subject to a background credit check. The roles, criteria and exemptions under state law must be strictly followed an adhered to. The processing of client information does not, by default, constitute a credit check.

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