We previously discussed the validity of credit checks as part of a job hunt and you had plenty to say. If you’ll remember, we wondered whether an employer should be able to check your credit history and use that information to decide whether to hire you. Based solely on your comments, the overwhelming majority of job seekers think the practice is unfair, and here are just a few of your reasons:
• “There are thousands of people in the work force who have bad credit, from major to minor credit issues. If everyone was given a credit check, [from the] president on down the line, how many jobs would be lost? I’d say the vast majority of congressmen, senators and those who work in positions of authority in the U.S. would have some explaining to do. Credit checks do not give an ethical picture of the person; there are many reasons behind poor credit. This does not mean the person will steal from your company or trade secrets to foreign countries.” — Lenore
• “I think that [it] is a disgrace that an employer can check your credit and use it to decide if they want to hire you or not. There are many things in life that can cause one to have bad credit. What about companies that go bankrupt and can go under a different name and open back up? Maybe the person that has a bad credit history should be able to go under a different name to re-establish their credit.” — Bre
• “I am just wondering: Do the companies that require a great credit score pay all their invoices in less than 30 days? … What’s their customer satisfaction ratio? BBB information?” – Bill Bailey
• “When you are unemployed, you may very well get behind in your bills. Heck — you can have a job and be behind on your bills! On top of that, you may or may not have erroneous marks on your credit report that even if you know about them, it takes time and money to get them corrected. It is not as if a simple letter will make them go away.” — Cats
Recently, the Arizona Republic ran a story on the same topic, due in part to the Equal Employment Opportunity Commission’s concern about credit reports. Credit checks, the EEOC says, might hurt women and minority groups more than any other job seekers.
Reporter Jahna Berry explains:
“Financial pressures often are a motivation for employee theft, according to the Association of Certified Fraud Examiners’ 2010 review of more than 1,800 workplace-fraud cases worldwide. The study found that living beyond financial means accounted for 43 percent of the cases, and money difficulties accounted for 36 percent of the cases.
“Those fraud statistics are disputed by consumer advocates, who argue that the fraud examiners’ report suggested that men, older workers and divorced employees were prone to theft, but employers don’t screen based on those characteristics.”
Berry interviewed job seekers whose finances took a hit after layoffs, which then made finding work more difficult. One job seeker and his wife sought a loan modification on their home after he was laid off. In order to get the modification, they had to skip some mortgage payments, and that naturally dented his credit history.
According to the Washington Post’s coverage of a recent EEOC meeting to discuss credit checks, employers aren’t running the checks just because you give them permission to in your application.
Columnist Michelle Singletary writes: “The Society for Human Resource Management says job applicants shouldn’t worry too much about credit checks. Although about 60 percent of organizations use credit checks when selecting employees for some jobs, only 13 percent conduct credit checks on all job candidates.
“‘Credit-check results are one important component of the hiring decision but are not typically the overriding factor in the consideration of a job candidate,’ Christine Walters, a human-resource professional and lawyer, told the EEOC.”
Of course, as Singletary’s article explains and many of you explained in our last post, your financial concerns don’t turn you into criminals. You might be behind on a few mortgage payments, but you’re not necessarily going to embezzle from your boss. After all, you took the job to make money and stay afloat financially, so the last thing you want to do is risk losing your job. That’s probably the reason you allowed the company to run the credit check in the first place — you didn’t want to say no and lose a job opportunity.
According to the EEOC, more meetings in the coming months will look at potentially unfair hiring practices and how they affect various groups. Although no recent significant changes have come regarding credit checks, hopefully discussions about them won’t die down. If more employers understand the nuances of financial hardships and personal responsibility, they might be willing to look beyond and credit score and find the candidate who will actually do the best job.