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
George Bailey
October 27th, 2010
5:38 pm
Nisha, read my previous post to Rivercard. It might help you to understand how employers draw conlusions based on credit history.
morons
October 27th, 2010
5:38 pm
Let’s just hope that none of the advocates of credit checking for employment ever become the victim of identity theft.
Rolling-in-coleslaw
October 27th, 2010
5:41 pm
I have a boss and production mgr who can’t manage their money and can’t manage their department but they think they are the smartest people on the planet, the employees are dumb as dirt.
morons
October 27th, 2010
5:42 pm
It’s simple: Being in overwhelming debt makes the candidate a risk for theft or espionage. Say you had $200,000 debt that you could not make a single payment on. Someone comes up to you and offers you $200,000 if they you will give them an internal document. This is why credit checks are an important part of the background check.
Apples and oranges.
Bad credit does not equal theft.
200k debt would lead to a quick bankruptcy.
Mental Floss
October 27th, 2010
6:00 pm
morons Poor thing, are you unemployed? You sound so bitter!
Mental Floss
October 27th, 2010
6:03 pm
Rolling-in-coleslaw
So you work @ KFC? Do you realize you just called yourself “dumb as dirt”?
Mental Floss
October 27th, 2010
6:05 pm
oh, morons
Your identity was stolen too? Pity
Boss Man
October 27th, 2010
6:08 pm
I wish I could also check to see who voted for Obama. Oh well, the credit checks will probably give me the same results.
DAWG
October 27th, 2010
6:22 pm
What a bunch of crap. With the economy the way it is right now, a lot of people are struggling to make ends meet, this does not mean they are less productive and would not be an asset to a company.
George Bailey
October 27th, 2010
6:25 pm
DAWG, read my previous post. It’s an overall picture based on a 5 to 10 year run. Noone is getting denied because of wha happened in the last year. However, if the person had a job, was getting paid, and still chose not to honor their fiancial obligations, it sends a pretty powerful message to an employer. Alos, Medical is not considered when looking at someones credit history. Remember, it’s the history, and not the FICO score. The report that employers see does not give them the FICO.
LG
October 27th, 2010
6:37 pm
This is specifically to Margaret Gray and all the other like-minded, ignorant individuals!
I am a college-educated intelligence analyst who is well qualified to perform my job. I happen to support OUR president and I can see where affirmative action (in some case) may be necessary! I was subjected to a credit check, drug testing and every other security check known to man! I do have top secret clearance as well…however, I DONT agree with the mandatory credit checks. That has nothing to do with my ability to do my job. I hope all of you have the same attitude when it’s time to vote for the next Governor….since he can’t seem to manage his finances, but he wants to manage this state. PLEASE!
S
October 27th, 2010
6:42 pm
Seems to me doing a credit check on a person for a job, is an invasion of privacy. You shouldn’t have to sign your life away so someone else can find out your personal information. In this economy, millions of people could have lousy credit through no fault of their own. It is no longer the people’s country, Corporations rule the roost now. You get who you vote for and this is what we are left with. It’s all about profit and who cares about the people.
George Bailey
October 27th, 2010
6:43 pm
I agree LG, If Nathan Deal applied for a job, I’d decline him based on a combination of bad financial decisions and suspect activities as a congressman. I’d apply the same matrix to any employee looking for a job with a company that I represent.
dawgmom
October 27th, 2010
6:45 pm
I have not taken the time to read all the comments, so I apologize in advance if I’m repeating.
NO potential employer has the right to look into your credit history. Every time your credit is checked is a ding on your credit score. So, if you have applied for 10 jobs and each company checks your credit, by the time #10 checks, your score has dropped.
A long time ago, potential employers were banned from asking questions (to females) such as: Are you married? Does your husband’s job have the possibility of transfer? Do you have children? Do you plan on having children?
These are all private questions that, rightfully, have no basis on job performance. In the same vein, credit scores have nothing to do with how well the person can perform on the job and are a further invasion of privacy. ESPECIALLY in today’s tough economic environment.
George Bailey
October 27th, 2010
6:46 pm
I asked the question before, but I’m still waiting for an answer. All the people out of work with college degrees, do you feel that it’s unfair that you may have gotten a job because you have a degree vs. someone who doesn’t? If not, why are you so upset about a candidate with excellent credit getting a job over someone with a less than stellar credit history?
RGB
October 27th, 2010
6:46 pm
If creditworthiness is highly pertinent to the job (financial services or where the employee handles money or is involved with sensitive information or intellectual property), then a decent credit score should be considered a bona fide occupational qualification. For many other jobs the credit data would seem to be less relevant, though some note a link between poor credit scores and undesirable employee behavior.
But in this economy there are a lot of folks with bad credit scores and that number will increase.
That’s why it’s important to vote next Tuesday. Democrats, that’s November 3rd.
George Bailey
October 27th, 2010
6:47 pm
Dawgmom, the credit search done by companies is completely different than the one done by Equifax. As such, it has no effect on the candidates credit rating at all.
rivercard
October 27th, 2010
8:47 pm
All right George I will take the bait.
No, I don’t feel like it would be unfair ,if I were hired over someone without a college degree, if and only if, my degree was specific to the job being applied for. Otherwise, it seems it is just another crutch for the decision maker as opposed to being a viable tool. Having been this decision maker before, I understand the desire to have something to reinforce what is almost always a highly subjective decision, but just because I have it that doesn’t mean my decision was any more sound.
That is my problem with the credit report. While many “feel” it is predictive of some future behavior, I don’t. I haven’t seen any data that really gives credence to either viewpoint.
Boycott BP
October 27th, 2010
8:58 pm
Credit checks are ONE of MANY tools used to qualify candidates. A candidate for a job is typically selected based on many tools including a good work history, a good interview either in person or screened over the phone. Reference checks are another tool in the selection process. When a candidate passes these hurdles, a credit check shows whether the candidate can manage their affairs regardless of what life presents itself to the individual.
In the past when a candidate has a below average credit score, I have always brought this up to the candidate if I genuinely think the candidate is the one. How the candidate explains the situation helps me make the decision. The credit check is simply ONE TOOL in the selection process and I think it has value in the process.
shadow7071
October 27th, 2010
9:54 pm
Ok, I started out this morning with my comment that I think this credit checking for a job is nuts. Tonight, after perusing these 369 comments I’m more convinced that it’s nuts and many of you more holy than thou advocates are way misguided. You’ve drank the cool aide.
All through this tread of comments I’ve read the theme of “Responsibility”. The credit check will provide a measure of responsibility. Ok responsibility advocates let’s find out how far we should go.
I’m president of my own company and I hire and fire. I hired and fired throughout a twenty-five corporate career with a Fortune 10 corporation. So, I know how the game is played.
Let’s say that I have a job opening. It’s is a professional position requiring an educated, skilled, experienced and responsible person. What’s a fair criteria for selecting this person? Education? Work experience? Job knowledge? Motivation? Inspiration? Energy? Enthusiastic about the job? Good work references? Good communication skills? Good people skills? Actually, all of these are good criteria and are predictive of a good hire. But you advocates want to go further. You want to predict Responsibility. So let’s play that you’re my candidate and I’m going to predict you’re responsibility so….
I want you’re credit report because if you’ve paid your bills on time it’s a good predictor of your responsibility. Right? Right!
Next, I want your children’s grades from school because if they’re not making A’s and B’s then that shows you’re not a responsible parent and will not be a responsible employee.
Then I want your utility bills to see how you use water, gas and electricity because if you’re not responsible with precious resources you want be responsible on your new job.
I want to interview your neighbors to better understand how you maintain your home and property because someone who can’t keep their lawn up is not responsible and can’t be responsible on the job.
I want to know the history of your food purchases so that I can determine if you eat responsibly because some food choices are clear predictors of responsibility.
I want to know where and how often you attend church because someone who is not attending to the spiritual side of there life is not responsible and will not be responsible on the job.
I need a record of how often you call and talk to your mother because a person that is not responsible to their parents can’t be a responsible employee.
How far do you want me to take this advocates. You do get the point, right?
rivercard
October 27th, 2010
10:08 pm
@Shadow7071
Quit giving them ideas.
Pedro "Patron" Lopez
October 27th, 2010
11:29 pm
You filthy Gringos (referring to Los Blancitos).. The majority of my people pay cash for every thing we have. So that means low credit is not bad credit. It just means we choose not to be stupid and pay interest to the banks like you do. The day will come, when white will fade into the sunset like Jordache jeans..
Clayton Bigsby
October 27th, 2010
11:33 pm
And all of you Jim Crow Jackarses who thinks its wise to run a credit check on potential employees will most likely vote for Nathan Deal. You bums..
Slick Rick
October 27th, 2010
11:38 pm
“Research indicates African-Americans and Hispanics tend to have poorer credit than whites”
O yeah……Well I am half black and half Mexican…….
And my credit blows!!!!!!!!!!!!!!!!!!!
Clayton Little
October 27th, 2010
11:42 pm
I’d be all for a credit check by an employer as long as the employer brings their financial records to the interview so I can check their accounting books, percentage of raises given to current employees and the timeframe between raises, did they borrow from banks during this recession to keep their business going and how current are they on their loan payments, and has the executive team members ever had to file for bankruptcy or been with a company that filed bankruptcy and what was/is the current bonus structure for the employer’s executive team members. If they don’t want to divulge that information then they have no reason for me to divulge my information.
gamama
October 27th, 2010
11:49 pm
I admit, I have had to file bankruptcy last month and my credit sucks!
It was not because of over spending and being irresponsibility…which I believed was why people are in the shape they are in with over extending themselves.
but rather it was because of my small business is not surviving due to our economy. Had to use credit to keep us afloat over the last 3 years; trying to turn business back to profitable.
And…husband had a lay-off and now reemployed with 40% decreased income.
for those of you you blasted poor credit as a part of overspending and irresponsibility — lets talk!
We are hard working and honest people. I have access to most of my customer’s credit info and I WOULD NEVER THINK OF USING IT no matter how desperate!
Deciding a person’s ability to do a job based on credit worthiness is just WRONG!
Damon
October 28th, 2010
12:21 am
CREDIT REPORTS: Now Supplanting Skanky Blonde Women with No Morals or Self-Respect as “The Black Man’s Kryptonite”
Another Unemployed Atlantan
October 28th, 2010
12:35 am
Of course a credit report has NOTHING to do with a person’s job performance! My credit score is low for reasons that I had no control over. It is NOT a way to judge someone’s character. It is PRIVATE and is no one’s business but my own!!!
Rolf
October 28th, 2010
1:06 am
It’s the same as “if you need a loan you can’t get one, but if you don’t need it, you can borrow all the money you want. America is severely farked up, and it isn’t a current thing. You have to go back to the Civil War to see the beginnings of the end. But America will end, one way or another.
M
October 28th, 2010
2:04 am
I will let a company check “my” credit report, (which is excellent), if they let me see “Thier Credit Report and complaints First!” You must interview the Employer as well. Too many companys are ran by idiots in the first place. Just because a person may have bad Credit may only mean they need a job to pay the bills. This country owes China, do you want us to let them see “Our Credit Report???? You get the picture??? How dare a company within “this” country ask such a thing????
Ross
October 28th, 2010
2:14 am
I think employers should run a spelling check on potential employees, to weed out the loosers who might effect they workplace.
-drl
lauraannphillips
October 28th, 2010
3:54 am
no no what credit score have to do with a job ? peoples need jods
Whatiftheshoewasonyourfoot
October 28th, 2010
5:54 am
Hi Bryan, FYI, A CREDIT REPORT IS MORE THAN CREDIT CARDS! Okay Bryan let’s say you are making a 6 figure salary and you were let go. Now you home is worth $400,000, your leased cars are a total of $1,100 per month and we’ll forego the utilities, food, maintenance and insurances. You get the picture. Not everyone with a poor credit report are unresponsible bill payers. So do you get the picture, there are circumstances that can’t be help in some cases. So don’t assume anything not in this economy, don’t judge for you may end up in their shoes. It is not fair to use credit reports as a consideration in job hiring. Isn’t the extensive background check enough? I know what your thing how about a Bank Teller, well they are bonded and there are very sever sentences for stealing. PeaceHi Bryan, FYI, a credit report is more than credit cards! Okay Bryan let’s say you are making a high 6 figure salary and you were let go, no job. Now you home is worth $400,000, your leased cars are a total of $1,100 per month and we’ll forego the utilities, food, maintenance, daycare, tuition and insurances. You get the picture. Not everyone with a poor credit report is an irresponsible bill payer. So do you get the picture, there are circumstances that can’t be help in some cases. So don’t assume anything not in this economy, don’t judge for you may end up in their shoes. It is not fair to use credit reports as a consideration in job hiring. Isn’t the extensive background check enough? I know what your thing how about a Bank Teller, well they are bonded and there are very tough sentences for stealing. Peace
NoCreditReports
October 28th, 2010
5:56 am
Hi Bryan, FYI, a credit report is more than credit cards! Okay Bryan let’s say you are making a high 6 figure salary and you were let go, no job. Now your home is worth $400,000, your leased cars are a total of $1,100 per month and we’ll forego the utilities, food, maintenance, daycare, tuition and insurances. You get the picture. Not everyone with a poor credit report is an irresponsible bill payer. So do you get the picture, there are circumstances that can’t be help in some cases. So don’t assume anything not in this economy, don’t judge for you may end up in their shoes. It is not fair to use credit reports as a consideration in job hiring. Isn’t the extensive background check enough? I know what your thing how about a Bank Teller, well they are bonded and there are very tough sentences for stealing. Peace
GwinnettRep
October 28th, 2010
6:18 am
Looks like Nathaan Deal could’nt get a job out side of the top job in Georgia. Voters need to take a clue from the buisness world and see the risk of hiring a person who is deperate and has access to money or information!!!
Tamika
October 28th, 2010
6:18 am
Employers are trying hard to find good people. They need workers and know that . They also don’t want to hire bad employees. They are expensive and consume a huge amount of resource and attetnion. Checking references and credit are two ways of potentially screening out employees who will not be good employees. I have used credit checks to spot people who either are under so much financial pressure that they cannot concentrate or who are not meeting commitments. We also reference checked employees to find people who performed well in previous employment. If you take away the employer’s abililty to screen out bad employees, they will just be more likely not to hire anyone at all.
Atl Resident
October 28th, 2010
7:00 am
Palin fan
October 27th, 2010
9:08 am
Credit and health history should be checked before someone has the privilege of a job.
With the high unemployment, no lazy Obama-loving types with type-2 diabetes who don’t pay there bills should be taken jobs away from decent, hard working real Americans.
This person needs to look at the whole picture with this issue or needs to be laid off to understand the grief. Hell to the no for credit checks and that’s the whole purpose for seeking employment to help get your credit better. How you going to get credit better when you being disqualified because of it?
Job Scared
October 28th, 2010
7:56 am
We had perfect credit until my husband was laid off, we used all our savings, had to start pulling from our IRA account until it was no more just to keep our bills paid so our credit was affected in hopes he would find another job, only once the money was gone we starting falling behind, my check & unemployment was the same amount, so it didn’t go far. My son couldn’t go to college after high school, we tried to work something out with our creditors with no luck, now we are being hounded by collectors threating to lean our home & bank account, which by the way has no money and our credit score is like 560 when it use to be 783. My husband will never find work going by the credit score & in his line of work he has nothing to do with handling money or any finance at all. What are we going to do? What are the rest of the people going to do?
Clark Howard jr
October 28th, 2010
8:01 am
Here is a tip for you….Got bad credit and won’t pass the credit check? Do what I did.
Put a credit freeze on your account. This way the company doing the search will run a check and it comes back with nothing. They can only assume you do not borrow or have zero credit history. Worked for me.
A Credit Freeze keeps your auto insurance rates down too. Geico, etc. and the like can’t arbitrarily raise your rates based on your credit report if you have a credit freeze.
The Georgia legislature will never enact consumer credit/employee rights protections laws (such as in California, Oregon) that will ban employer hiring credit checks.
Reason why? Equifax is based in Georgia and they are quick to line the pockets of the politicians.
Same reason why Georgia was one of the last states to enact the credit freeze.
Don’t listen the racist George Bailey. He probably works for Equifax.
First Sergeant
October 28th, 2010
8:13 am
gamama
October 27th, 2010
11:49 pm
So, what is your position on Nathan Deal and his financial woes? Would you hire him? And, please explain.
First Sergeant
October 28th, 2010
8:24 am
shadow7071
October 27th, 2010
7:24 am
However, if you are a career politician with clear ethics issues and clearly under financial distress due to your own mismanagement, then you qualify to governor of Georgia! What a f–king disgrace.
I do however have a question for you employers on this blog: Would you hire Nathan Deal to handle your money; to handle fianancial decisions for yoiur company; to handle investments for your company; to sit on your company’s board where decisions are made concerning the future of your company? Please explain!
First Sergeant
October 28th, 2010
8:36 am
Job Scared
October 28th, 2010
7:56 am
“What are we going to do? What are the rest of the people going to do?”
The first thing you and many like you can do is not elect a Governor who is in the same situation. Trust me, he will pull himself from debt, utilizing our tax dollars, and won’t do a damn thing for you and those like you. Sonny Perdue has done nothing for the individual citizens of this state. What make people think his buddy Nathan Deal will be any different is beyond comprehension to even the most ignorant. Roy Barnes is not the perfect candidate, but he is the best candidate on the ticket for Governor of Georgia.
And no, I’m not endorsing Roy Barnes. I simply just can not phatom a known crook running my state. Period!
I'm Here From The Government And I'm Here To Help
October 28th, 2010
9:07 am
YEP!!! You own the company and see if that changes your mind.
Really?
October 28th, 2010
9:15 am
People in general are good natured. We say “excuse me” when we bump into someone by mistake, we say “bless you” when even a stranger sneezes, we give money to homeless people,volunteer our time, we console strangers if we see them in pain, we donate to charities, buy neighbors girl scout cookies even if we don’t want them, and the list goes on and on. However for some reason many of us are irresponsible with our own personal finances. We have a do as I say but not as I do attitude. A friend once told me that don’t judge your teenager as to the way she treats you but rather how she treats other people. It is in our nature to treat other people with more respect than we treat ourselves. Ever find yourself being more courteous to strangers than family members? With all this being said I believe that a credit score tells very little about how a person will perform for a company. An interview, background check(so that you know the person isn’t wanted by the police) and a thorough check of references and possibly past employers is more than enough to help one predict whether or not this person will make for a good employee. A credit score will not tell you this and no one can prove it.
angela
October 28th, 2010
9:30 am
@dawgmom. A corporation has every right in this country to check your credit. It’s why you live in America. Now, you have a right to decide whether you want them to have that access or not.
@morons. If one was a victim of ID theft, hopefully, that said credit report will state such, providing the victim notified the reporting agency in a timely manner.
and I would LOVE to reiterate: live within your means. My husband and I do what we want to do, we have no debt, we are prepared for a lengthy illness, we are prepared for sudden job loss. It is actually very easy and stress free to live the way we do, even in this economy.
If you don’t want your poor credit broadcast to a potential employer, by all means, don’t let them check it. That is YOUR right. Americans have chosen to allow corporations to run their lives, then you need to abide by their rules. We chose to control our own lives.
Smartin
October 28th, 2010
9:39 am
I don’t like it, but an employer has the job and I don’t have any “rights” to the job. What I have is the right to walk away from the job if I don’t want to let them do a credit check. We are slowly losing our freedoms. If everyone refused to allow a credit check, the situation would quickly change.
morons
October 28th, 2010
9:45 am
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?
Funny how you think that someone in charge if the STATE handling laws and billions of dollars and someone working in a standard job is the same thing. It isn’t. DUH.
morons
October 28th, 2010
9:52 am
@angela
I sure didn’t get any chances to explain what is on my credit report. I just got flat out rejected. Since you LOVE to say “live within your means” what would you do should you lose your job and all of your assets/bank accounts get stolen? You will find out quickly that credit reporting agencies do not care, and it takes near an act of congress to get the situation corrected. With no $ for a lawyer, you’re screwed.
morons
October 28th, 2010
10:01 am
Credit and work ethic have absolutely no correlation to each other. Unless someone can show me a study that consistently links bad credit with bad work ethic, then go fly a kite.
Rosaria
October 28th, 2010
10:17 am
@ ChipprJones at 1:48 am on 10-28-2010
Chippr,
I just bet your co-workers just LOVE having to put up with your foul-mouthed, undereducated, impatient anger management issues each day.
They must each be absolutely overjoyed at having work extra each day to cover up your mistakes, lack of attention to detail and overall incompetence while you can spend most of the day just “keeping it real.”
You should be lucky for that you are entitled to that nice, over-paying, Affirmative Action job you have and could never EARN on your own merits, especially when you probably lack the requisite intelligence, patience, humility and people skills to work at even the Post Office.
Why you are bragging about your fantasy credit score and how much money you make, why don’t you go ahead and brag to us all about you “good” you are in bed, too?
Keep THAT Real, My Man!