Employer Credit Checks… Good or Bad?

workforceverification February 21, 2012 0

Landing a job is very important, but how many steps does it take to get there? Usually during or after the interview process, employers conduct background checks, credit checks, and even look at your references. Some potential candidates do not like these checks, but they are very beneficial for the company to find out the history of the candidate.

According to the Society for Human Resource Management, 60% of employers use credit checks for job candidates.

Although background checks are very legitimate, some professionals are concerned with employer credit checks and they are under heavy fire right now. The underlying concern with these credit checks are that poor credit scores could become a barrier for not landing a job.

 

The big debate right now is whether the credit reports are an accurate way to measure employee qualifications for a job. On one side of the debate, employers think the credit checks are a good check because those with bad credit scores are more likely to be irresponsible, and also steal from the company because they have less money. Employers also argue that credit checks protect businesses against fraud. On the other side of the argument, potential employees feel this is unfair because mistakes happen to everyone. According to the executive director at the U.S. Chamber of Commerce, “It’s very easy for the best, well intentioned people to have very difficult times, and employers recognize this.” Also, employees think that being able to pay your bills on time has no direct correlation to job performance. According to Chi Chi Wu, from the National Consumer Law Center, “It is a practice that we believe is both harmful and unfair to American Workers.”

Right now, some states are creating laws for equal employment opportunities that limit the use of credit checks for companies. There are certain exceptions for industries like banks, credit unions, debt collectors, insurance agents and government jobs.

Where do you stand on this issue with credit checks??

Source: itstechnologies

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