Simply because a sales associate or cashier may handle
credit applications doesn’t mean a retail employer should be allowed to deny
jobs to applicants with poor credit history, a state appeals panel has ruled.
On Sept. 27, a three-justice panel of the Illinois First
District Appellate Court ruled against Neiman Marcus, finding the department
store chain had violated the rights of plaintiff Catherine Ohle, who had been
denied a job at the chain’s Oak Brook store after a background screening revealed
elements in Ohle’s credit history Neiman Marcus found questionable.
The justices said such practices violated the state’s law
prohibiting the use of credit checks to screen job applicants.
The decision reversed the decision of Cook County Circuit
Judge Kathleen Kennedy, who had ruled in favor of Neiman Marcus, finding the
Illinois law actually exempted retailers hiring sales associates who may handle
in-store customer credit card applications. Since initiating those credit applications
required sales associates to be able to see customers’ “confidential
information,” the judge sided with Neiman Marcus’ contention that this
essentially gave those sales associates “access” to that information, and,
thus, made the credit history of applicants for those sales associates positions
fair game for employment screening.
The justices, however, said this reasoning represented too
broad a widening of the definition of “access” within the state law.
“To construe ‘access’ to personal or confidential
information so broadly as to include merely accepting credit card applications
by an entry level employee applying for this type of position nullifies the
legislative intent evident in this Act,” the justices wrote.
Justice Daniel J. Pierce delivered the opinion of the court.
Justices Michael B. Hyman and John B. Simon concurred.
The case arose in 2012 after the retailer declined to hire
Ohle for the position of “Dress Collections Sales Associate” at its Oak Brook
store. Neiman Marcus specifically cited the results of its check of Ohle’s
credit history in denying Ohle’s employment application.
Ohle then filed a putative class action lawsuit, claiming
the retailer’s use of credit checks violated the Illinois Employee Credit
Privacy Act, which “prohibits an employer from inquiring into a potential
employee’s credit history and prohibits an employer from refusing to hire the
applicant or discriminating against the applicant because of his or her credit
While Neiman Marcus soon after ended its use of credit
checks for sales associate positions, the company responded to the lawsuit by
arguing the state law provided for the use of credit checks for positions for
which a “satisfactory credit history” is an “established bona fide occupational
While the retailer attempted to argue its sales associate
positions, by virtue of job duties which included handling money and, in
particular, credit applications, fell into that category, the justices
disagreed, saying the law was meant to apply to the managers and other higher
level store personnel who actually handle the credit card applications once
they move beyond the sales counter.
They said in the process of initiating and handling
customers’ credit card applications and the “confidential information” they
contain, the sales associates essentially act as a “conduit,” undertaking “a
task no more sensitive in nature than entering credit card numbers into a
credit card machine or taking down driver’s license information to accept a
personal check in order to complete a sales transaction.”
“If the Act applied where employees are simply handed credit
card applications and then place the application in a drawer for processing at
a later time by a different department, then retail clerks in most stores,
including retail stores like defendant’s, would be exempt and employers would
be allowed to deny employment to citizens who face ‘financial hardships that
are often unpreventable’ due to the ‘harshest economic situation we’ve seen in
decades’ and who are not able to obtain employment despite ‘bad credit,’” the
The justices remanded the case to the Cook County Circuit Court
for new proceedings.
Ohle was represented in the action by attorneys with the
firm of Stephan Zouras LLP, of Chicago.
Neiman Marcus was defended by the firm of Jackson Lewis
P.C., of Chicago.