Should credit checks be used in hiring decisions?
Should companies use credit checks to help them decide whether to hire you?
AJC reporters Katie Leslie and Marcus Garner write that a growing number of people affected by record joblessness and foreclosure have a new worry: Will bad credit keep me from getting the job?
While the U.S. Equal Employment Opportunity Commission reviews testimony regarding the use of credit background checks for employment, supporters say the checks are a smart business tool. Critics counter that the reports unfairly discriminate against minorities and those affected by the recession, Leslie and Garner write.
What do you say? How much weight should credit checks be given? Are they relevant? Why or why not?
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414 comments Add your comment
Corrina Webber
October 27th, 2010
11:21 am
I am an HR professional, and I do not think credit checks should be used in hiring. I think there are many things that can occur in someone’s personal life that could impact thier credit, while not being a correct indicator of their character. For example, they could have a loved one with an illness or the economy could affect them. I just think that if someone is “discriminated” against (and yes I think it could be discrimination) for their credit history, then we are really doing an injustice to the company we represent as well as the economy in general. Now, I understand that any additional peek into someone’s real self is important in hiring, because there are so many “screens” they put up, but I believe that the Human Resources professionals of the world can come up with a better solution then this. There are many people that have great credit, and not so great character.
Always A Victim
October 27th, 2010
11:25 am
“How many paid troll blog posts does it take to buy an Acura?”
Corrina Webber owns one!
One Nation Under educated
October 27th, 2010
11:25 am
Dream On… dream until your dreams come true!
No, quit dreaming – Get a job, Work hard, fight tyranny,
Blog trolling don’t pay enough to float an Acura, punk. And pull your pants up. You look stupid like that.
ToLondon2012
October 27th, 2010
11:27 am
Look my credit is f***** up… However I worked for a fortune 100 company handling credit cards, and purchsase orders for business, and customers. These cards some had no limits, and some where pcrds. Not once did I think oh my car getting ready to repossed i need to get these numbers. People with good credit can steal from there jobs and there is more cases of that. All those teachers who were arrested for the pcard fraud didn’t pay bills with it. They brought all kinds of goodies and lux items. I mean my job is diffrent from my personal life. People have so much going on now credit is the least of there worries. However was laid off and jobs transfered to temp workers who are stealing the credit cards. It is just a matter of integrity, didn’t Bernie Madoff steal millons (I am sure he had a1 credit). Credit can’t determine what type of employee you are going to be. If that was the case I should not have been at my job over elven years, or when the IRS came after me.
Chris
October 27th, 2010
11:29 am
Know that you do not have to be directly handling money or finances in order to steal. Using that as a crutch will only have you fall down the stairs of ignorance.
Your credit affects all aspects of your lives. Whether you want it to or not.
Chris
October 27th, 2010
11:31 am
And know this: if your credit is affecting if you get that job or not, either there’s more to your personell file (or lacking), or your credit is atrocious. The credit score is but one factor, not the one factor.
Call your bluff
October 27th, 2010
11:37 am
One Nation Under educated
October 27th, 2010
10:25 am
“HR, Gotta go, Closing (financial) the 3rd fastest growing co. in Atlanta this week, so my life is pretty good. But I am not free until all people are free of tyranny. At least I don’t work in HR.”
WOW, thought you were LEAVING to go do something important!
What a tangled web we weave … deadbeat!
Georjajim
October 27th, 2010
11:38 am
Cheese, I think you misunderstood…at least I think you did. I was saying that just because an employer checks your credit rating DOESN’T mean they are racist or trying to weed out “certain” folks.
I was also saying that if they DID do that, that they are not a very smart businessperson to use that criteria.
The rest of my post was not an opinion, but a stated reality in most retail corporations hiring for Store Managers, Receiving personnel, etc.
Not sure how I confused you, though. There was no racism or bigotry in my post.
Samantha
October 27th, 2010
11:39 am
I don’t think that credit checks should be used. Simply because of the extremely high unemployment rate. I myself have fallen behind on credit card payments because I was laid off over 4 months ago. My unemployment basically covers my mortgage, car note. It barely covers anything else.
I think it’s wrong for all companies to use that to determine if they are going to hire someone or not. Just like the lady in this story…they should have hired her if it shows that she was behind on her mortgage because of job loss.
It’s just another form of racial discrimination! I know for a fact that if a company really want to hire a person they would.
I believe that if a company is interested in hiring a person, check their credit report and found some things on there that is not good; they should at least give the person a chance to explain what happened instead of just ’suddenly’ deciding not to hire them.
Call your bluff
October 27th, 2010
11:40 am
One Nation Under educated
October 27th, 2010
11:25 am
“Blog trolling don’t pay enough to float an Acura, punk. And pull your pants up. You look stupid like that.”
Yep, you have a mighty important job. You look stupid just posting. All lies and fantasies.
Pity.
Samantha
October 27th, 2010
11:43 am
Corinna Webber: I agree with you 100%
Rainy Day
October 27th, 2010
11:54 am
@ Samantha
Where was your “rainy day fund” (savings) when you lost your job? Did you think you were so perfect at your job that your boss would never dream of letting you go?
The excuses are over folks ~ the current economic crisis isn’t going to give you a “get out of jail free” card. The personal responsibility crowd always wins.
ed
October 27th, 2010
11:54 am
Have you ever had to deal with the three major credit agencies? Forget it! I would not trust anything contained in their reports. I’ll take three good references, both personal and business, anytime over the credit agencies which employ clerical personnel who can barely read.
Middle_Class
October 27th, 2010
11:54 am
Funny, going bankrupt every 5 or 6 years never kept Donald Trump from getting bank loans. I’m sure the rich have a different credit rating system. CEO’s steal billions and can leave prison and walk into a new CEO position. Martha Stewart walked out of prison for insider trading and they threw TV offers at her.
The bottom line ….. there are rules for the rich and powerful and those for the rest of us.
Charles
October 27th, 2010
11:56 am
So to all of these CALLOUS people on here- who do you think you are? Jesus? Stop judging folks and tend to your own matters!
One Nation Under educated
October 27th, 2010
11:58 am
Adolf, Cheez-whiz, Dream On, Call your bluff,
gotcha. – heh-heh – like I said, pull your pants up, I ain’t gonna hire you lookin like that, no matter what your credit score is. I’m waitin for M/E reports. You’re waitin for Momma to call you out of her basement. And tell us you got an Acura. I can see you drive up in your hoopty-car from my corner office window. And take “blog-trolling” off your resume. It aint a creer, and it doesn’t suit you. You’re welcome.
THE Controller
Rainy Day
October 27th, 2010
12:00 pm
I was unemployed for 13 months and paid all my debts on time. Part of that time was do to the fact that I didn’t need a job to support my family. I had over two years income saved for unemployment, plus additional. I never took unemployment either. When I finally found the right job, I offered my credit history as proof that I was not in trouble. I was immediately hired with full benefits from the start and was on the job just a few months and I received a promotion and nice raise. It does pay to be financially secure and have perfect credit. There are no excuses!
professional skeptic
October 27th, 2010
12:00 pm
If no one in Georgia cares about Nathan Deal’s credit record, then no one else seeking employment in Georgia should be judged on his/her credit record, either.
If we’re going to use this as a standard for employment, then it should be uniformly applied, or dropped altogether.
CreditReportJokes
October 27th, 2010
12:01 pm
LoL…what I find interesting is that the banks do credit checks for EMPLOYMENT…but they DO NOT do credit checks on the companies they do business ventures with..
Troll Police
October 27th, 2010
12:03 pm
@ Middle_Class
Sorry, but you are NO Donald Trump, Martha Stewart, Bill Gates, etc, etc, etc.
Stop with the wealth envy and tend to your own financial affairs.
Chris
October 27th, 2010
12:04 pm
Some of us do care about Deal’s misfortunes in finance, and ARE going to judge him for it.
fair is fair
October 27th, 2010
12:06 pm
I would not be opposed to having my credit report reviewed by the company IF they would allow me to review their financial statements to see if I feel they are healthy enough for long term employment. Also, do they randomly pull credit checks on active employees? People can get in credit trouble while they are working there so should not they be fired?
LMAO
October 27th, 2010
12:07 pm
One Nation Under educated
October 27th, 2010
11:58 am
Adolf, Cheez-whiz, Dream On, Call your bluff,
gotcha. – heh-heh – like I said, pull your pants up, I ain’t gonna hire you lookin like that, no matter what your credit score is. I’m waitin for M/E reports. You’re waitin for Momma to call you out of her basement. And tell us you got an Acura. I can see you drive up in your hoopty-car from my corner office window. And take “blog-trolling” off your resume. It aint a creer, and it doesn’t suit you. You’re welcome.
THE Controller
LMAO One Nation, you are ONE PATHETIC sore loser! Are your numerous lies a reflection of who you really are! You betcha! Controller – LMAO!
First Sergeant
October 27th, 2010
12:09 pm
Truth Hurts
October 27th, 2010
8:46 am
If you cannot manage your own personal finances why would an employer want to hire you? There are too many other applicants who have managed their personal finances and are not deadbeats. Why take on unmitigated risk?
Such as Nathan Deal; why do Georgians want to hire this guy? Why take on the unmitigated risk?
Hired!
October 27th, 2010
12:14 pm
I think I should be hired over someone equally as qualified as myself based on my financial history. I got the job, they didn’t.
Hired!
October 27th, 2010
12:17 pm
“Also, do they randomly pull credit checks on active employees? People can get in credit trouble while they are working there so should not they be fired?”
If the bill collectors or Sherrif is tracking you down at work, you bet they check and they can fire you. When your personal life crosses over into your business life this is the price you pay. I have seen this happen!
One Nation Under educated
October 27th, 2010
12:21 pm
Despite the Disrupt-A-Thread under educated trolls thrown in at the last moment, I think the verdict is in on this issue – most agree that it is wrong, and a feudalist, awful way to hire, but a great way to dole out privilege. Off to lunch
1911A1
October 27th, 2010
12:27 pm
Geez Louise, maybe employers should be administering spelling tests instead of credit checks.
One Nation Under educated
October 27th, 2010
12:27 pm
Adolf, Cheez-whiz, Dream On, Call your bluff, LMAO
I have no house payment. I live rent-free in this troll’s head. And I said – Pull your pants up, boy!
Reeeeally really gotta go now. heehee
Troll Police
October 27th, 2010
12:42 pm
I have no house payment = I live with Mommy & Daddy
(which gives One Nation the freedom to be a deadbeat and troll the Internet)
Troll Police
October 27th, 2010
12:44 pm
“Off to lunch”
6 minutes for lunch, did Mom make you a PBJ so you could get back to “work” so quickly!
Troll Police
October 27th, 2010
12:47 pm
“So to all of these CALLOUS people on here- who do you think you are? Jesus? Stop judging folks and tend to your own matters!”
IT happens when you air your dirty laundry on the Internet. FYI – calling people callous is judging as well!
Middle_Class
October 27th, 2010
12:49 pm
Not the ones who will vote for him. They are the SAME business owners and bankers that reject others for having bad credit.
Everyone who supports Deal with his 6 million debt and shady ethics and still thinks credit checks should be used to disqualify job applicants are HYPOCRITES!
“Some of us do care about Deal’s misfortunes in finance, and ARE going to judge him for it.”
Troll Police
October 27th, 2010
12:49 pm
“Have you ever had to deal with the three major credit agencies?”
No – never. However, I pay my debts. You wouldn’t have the hassel either if you did the right thing.
The Dogfighter Returns
October 27th, 2010
12:55 pm
What does this have to do with whether a candidate is qualified or not?
It is totally irrelevant unless the employer is making a loan to an employee.
rivercard
October 27th, 2010
12:56 pm
“We researched the issue a number of years ago and did not find sufficient data to support a correlation between a score and job performance and risk,” Suhr said”
Can any of you backing the use of credit checks produce any data correlating these issues or are these your “feelings”? It’s really just more voodoo that companies go through (personality tests, etc) that exist only to paper the file, cya and justify the HR staffing.
I will be glad to reconsider based on some pertinent data.
Butwadduino
October 27th, 2010
1:00 pm
From the article: “To my knowledge there isn’t any research out there that makes the critical link between what shows up on a credit report and information that gets to whether someone will be able to perform the job,” Crawford said.
For that reason, SunTrust mortgage company does not conduct credit background checks, spokesman Hugh Suhr said. “We researched the issue a number of years ago and did not find sufficient data to support a correlation between a score and job performance and risk,” Suhr said.
Said another way, there is apparently no conclusive evidence that hiring someone with a poor credit history increases their risk of poor performance or malfeasance. Unless there is a serious scientific study showing such a connection, then using credit history as a screening tool does not have any rational basis.
My gut feeling is that most of those committing fraud/theft did so because they had trouble living within their means – something that their credit history would likely reflect. But, it’s something else to say that any expected increased fraud risk associated with a credit-poor candidate is significant enough to be worth considering.
Further, if credit history has any validity as a predictor of a candidate’s risk of negative behaviors, could it not also be a predictor of certain positive employee behaviors (e.g., adaptability, creative thinking, ability to withstand stress, multitasking skills)?
Companies using this tool to screen out candidates are likely missing out on some excellent talent.
Witchhazel
October 27th, 2010
1:02 pm
George Bailey, the employer is in the power position not the employee. How many employee’s ask a potential employer for their credit report. I would imagine NONE because if we really knew the financial history of these companies many employees of the company would leave. Utilizing credit reports are a scam, some or legitimate, many are not. Criminal backgrounds are good indicators. Thus I bet Bernie Maddoff had perfect credit, around 800. Its a man made factor, you don’t see the potential for abuse because you have been suckered into the credit institute model of utilizing credit for other than financial purposes. When it fails they will say its within the probability of error, not statistical model can be proven 100% correct.
Remember I SAW THE MODELS!!!!
Stephen
October 27th, 2010
1:03 pm
if credit checks are so important to screen potential new employees, will employers go back and pull up credit on their current employees? Seems to me that everyone who work for their companies are not running with “passing” credit.
Come on son
October 27th, 2010
1:20 pm
I bet many of the people who support credit checks for employment are voting for Nathan Deal, who would not pass the credit check muster for an executive job, but “he is good enough for governor” = hypocrites.
A Hearty Cheese Sauce
October 27th, 2010
1:40 pm
Enter your comments here
iamadogperson
October 27th, 2010
1:46 pm
i remember when i applied at a CPA firm that they wanted to do a “background” check. i knew nothing of the practice of running a credit report. my husband and i had , in fact, filed bankruptcy years
earlier because of an automobile accident in which he became totally disabled. my puney salary would not accomodate our bills. what the CPA
firm asked me to do was write in my own words why we filed bankruptcy. i did get the job, but i don’t know if i have had this experience since. the position was as a bookkeeper, so maybe, like mentioned above, it was because i was handling the finances
Use Cash - Not credit
October 27th, 2010
1:46 pm
I have used cash only for over 13 years and then lost my job due to the economy. I have a lower credit score due to NOT using credit cards. I should not be denied employment because I don’t rely on credit cards. I should be put in management because I DO know how to manage money. I did it alone – no roommate – no “live in” boyfriend – no spouse!
Mary
October 27th, 2010
1:49 pm
Oregon has outlawed this practice. Time for other states to use the precedence.
Sick&Tired
October 27th, 2010
1:57 pm
It’s just another form of discrimination and I’m speaking as someone with excellent credit. It’s being used to deny jobs to people they truly don’t want in companies. I believe it will eventually come back to hunt them. If you’re not dealing with money or finances; it should be outlawed.
It’s just as bad as not interviewing candidates who have been unemployed longer than 6 months.
Andy in Blairsville
October 27th, 2010
1:59 pm
I think credit checks are a fantastic prerequisite for employment. If your employer can run a background check on you, there’s no reason he can’t run a credit check on you.
It’s ok for your employer to know you have a DUI but it’s not ok for him to know you don’t pay your bills? Both credit checks and background checks show character and maturity or lack thereof.
mike
October 27th, 2010
2:06 pm
There’s general characteristics of someone with bad credit: money mismanagement issues, potential entitlement issues in regards of not paying the money back and potential influence of stealing to address current financial crunch, to name a few. Some or all may apply. That being said, it’s important for a business owner to know who they’re potentially dealing with.
Recent Air Force Vet Unemployed
October 27th, 2010
2:09 pm
Good luck getting a law preventing this since our very federal government pulls credit reports in order to get a security clearance. Crappy credit? No Top Secret, and probably not even a Secret…Is that to discriminate against minorities?!
Recent Air Force Vet Unemployed
October 27th, 2010
2:12 pm
Great, yeah Mary…Let’s follow Oregon?! Of course Oregon has outlawed this practice, as their people can’t even pump their own gas…Be gone hippie.
not so fast
October 27th, 2010
2:17 pm
Interesting how many of you seem to think hiring people based on credit decisions is wrong but yet think Deal should NOT be elected because of his credit (and think that hiring him while rejecting others is wrong). Isn’t that the same discrimination?
For the record, I have very good credit and think basing a hiring decision on credit is bogus. I am an employer and do NOT run credit checks on my own internal employees. I DO run criminal backgrounds and MVR reports (yep – I want to know if someone had 3 DUI’s in the last 3 months – I don’t care about speeding tickets).