85R1928 KKR-F
  By: Canales H.B. No. 317
  relating to the consideration by certain employers of the consumer
  credit reports of certain employees and applicants for employment;
  providing administrative penalties.
         SECTION 1.  Chapter 52, Labor Code, is amended by adding
  Subchapter H to read as follows:
         Sec. 52.081.  DEFINITIONS.  In this subchapter:
               (1)  "Applicant" means a person who has made an oral or
  written application with an employer, or has sent a resume or other
  correspondence to an employer, indicating an interest in
               (2)  "Commission" means the Texas Workforce
               (3)  "Consumer reporting agency" means any person that,
  for monetary fees or dues or on a cooperative nonprofit basis,
  regularly engages in the practice of assembling or evaluating
  credit information or other information on individuals for the
  purpose of furnishing credit reports to third parties.
               (4)  "Credit report" means any written, oral, or other
  communication of information by a consumer reporting agency that
  bears on an individual's creditworthiness, credit standing, or
  credit capacity.
               (5)  "Employee" and "employer" have the meanings
  assigned by Section 21.002.
               (6)  "Employer engaged in or regulating financial
  services" means:
                     (A)  a bank, savings and loan association or
  savings bank, credit union, or other depository institution or its
  subsidiaries or affiliates;
                     (B)  a mortgage banker or residential mortgage
  loan company;
                     (C)  a securities firm or registered financial
  advisory firm;
                     (D)  a regulated loan company;
                     (E)  an insurance company or insurance agency; or
                     (F)  a state agency responsible for regulating an
  entity described by Paragraph (A), (B), (C), or (D).
  EMPLOYMENT POSITION. A credit report is considered to be
  substantially related to an employee's or applicant's employment
  position or prospective employment position if the position:
               (1)  is a managerial position which involves setting
  the direction or control of a business or a division, unit, or
  agency of a business;
               (2)  involves access to customers', employees', or the
  employer's personal or financial information, other than
  information customarily provided in retail transactions;
               (3)  involves a fiduciary responsibility to the
  employer, including the authority to issue payments, collect debts,
  transfer money, or enter into contracts;
               (4)  provides an expense account or corporate debit or
  credit card;
               (5)  involves access to the employer's nonfinancial
  assets valued at $2,005 or more, including museum and library
  collections or prescription medications or other pharmaceuticals;
               (6)  provides access to:
                     (A)  confidential or proprietary business
  information; or
                     (B)  information, including a formula, pattern,
  compilation, program, device, method, technique, process, or trade
  secret that:
                           (i)  derives independent economic value,
  actual or potential, from not being generally known to, and not
  being readily ascertainable by proper means by, other persons who
  could obtain economic value from the disclosure or use of the
  information; and
                           (ii)  is the subject of efforts that are
  reasonable under the circumstances to maintain its secrecy.
         Sec. 52.083.  EFFECT ON OTHER LAW.  This subchapter does not
  limit or affect the rights, remedies, or procedures available to an
  individual who alleges an unlawful employment practice prohibited
  under federal law, another state law, or an order or ordinance of a
  political subdivision of this state.
         Sec. 52.084.  PROHIBITED ACTS BY EMPLOYER. An employer may
  not require an employee or applicant to consent to a request for a
  credit report that contains information about the employee's or
  applicant's credit score, credit account balances, payment
  history, savings or checking account balances, or savings or
  checking account numbers as a condition of employment unless:
               (1)  the employer is a financial institution or other
  employer engaged in or regulating financial services;
               (2)  consideration of the credit report is required by
               (3)  the employer reasonably believes that the employee
  or applicant has engaged in specific activity that constitutes a
  violation of the law related to the employee's employment or
  applicant's prospective employment; or
               (4)  the report is substantially related to the
  employment position or prospective employment position of an
  employee or applicant and the employer:
                     (A)  has a bona fide employment purpose for
  requesting or using information in the credit report; and
                     (B)  discloses in writing to the employee or
                           (i)  that the employer intends to consider
  the employee's or applicant's credit report; and
                           (ii)  the employment reason for the
  employer's consideration of the credit report.
         Sec. 52.085.  ADMINISTRATIVE PENALTY. (a) An employer
  commits an administrative violation if the employer violates this
         (b)  The penalty for a violation under this section may not
  exceed $1,000. In assessing a penalty under this section, the
  commission shall consider:
               (1)  prior violations of this subchapter by the
               (2)  the severity of the violation; and
               (3)  any other factor the commission determines to be
         SECTION 2.  This Act applies only to an adverse employment
  action that is taken by an employer against an employee or applicant
  for employment or other employer conduct that occurs on or after
  January 1, 2018. Action taken by an employer or other conduct that
  occurs before January 1, 2018, is governed by the law in effect
  immediately before the effective date of this Act, and the former
  law is continued in effect for that purpose.
         SECTION 3.  This Act takes effect September 1, 2017.