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Pre-Employment Credit Checks Eliminated From Many States

Updated on August 5, 2016
Patty Inglish, MS profile image

Ms. Inglish is an award-winning Employment & Training pro with regional records and tens of thousands placed into gainful employment.

Credit checks for employment are gradually being eliminated in the United States.
Credit checks for employment are gradually being eliminated in the United States. | Source

Financial Discrimination is Possible via Credit Checks

Credit checks can be discriminatory within the procedures used for pre-employment investigations. This leads to still further financial hardship for those who cannot pass the scrutiny.

These financial-based background checks angered increasing numbers of the long-term unemployed American 2000 - 2013, especially in the aftermath of the Great Recession with its layoffs, downsizings, government bail outs, Stimulus Funding, and more.

Pre-employment credit checks, except for federal government, banking and financial services businesses, and similar should be eliminated.

Analysts have consistently found, from examining many corporate employment records across the country, that a personal credit history containing problems does not correlate with financial/material dishonesty on the job or with poor overall job performance (see the link and videos below for references).

Source

Analysts have consistently found, from examining many corporate employment records across the country, that a personal credit history containing problems does not correlate with financial/material dishonesty on the job or with poor overall job performance

— P. Inglish

US States That Eliminated Pre-Employment Credit Checks by 2016

Pre-employment credit checks are no longer legal in the following states, except for certain financial institutions, defense employers, or similar:

  • California
  • Colorado
  • Connecticut
  • Delaware
  • Hawaii
  • Illinois
  • Maryland
  • Nevada
  • Oregon
  • Vermont
  • Washington

Individual cities that passed legislation banning credit checks for employment citywide:

  • City of Chicago
  • New York City
  • City of Seattle, Washington has outlawed employers in the city from using criminal records found in background checks as a reason to deny hiring job candidates as well.

Mobile Health recommends all businesses to use an employee screening program to attract only the best talent. Credit checks are not vital.

— Virtual-strategy.com; 2013.

US States That Took Action To Begin To Eliminate Credit Checks in Non-Financial Employment Prior To 2013

  • In the Northeast: New York, New Jersey, Connecticut, Vermont, Maryland, Pennsylvania.
  • In the Midwest: Michigan, Missouri, Ohio, Indiana, Illinois
  • In the South: Florida, Georgia, Kentucky, South Carolina
  • In the South/West: Texas, Colorado, Arizona, New Mexico, Nevada, Arkansas
  • In the West: California, Oregon, Washington, Montana, Nebraska

Click thumbnail to view full-size
Homless family walks from Phoenix to San Diego in hope of gaining employment in The Great Depression (US 99. Near Brawley, Imperial County). Unwarranted credit checks feel like this to the serious job seeker.
Homless family walks from Phoenix to San Diego in hope of gaining employment in The Great Depression (US 99. Near Brawley, Imperial County).
Homless family walks from Phoenix to San Diego in hope of gaining employment in The Great Depression (US 99. Near Brawley, Imperial County). | Source
Source
Unwarranted credit checks feel like this to the serious job seeker.
Unwarranted credit checks feel like this to the serious job seeker. | Source

Professional Opinions from Workforce Experts

  • America’s Economic Comeback Requires Qualified Candidates for the Job | Virtual-Strategy Magazine -- "As America turns the corner of the recent economic slump, the Dept. of Labor shows that businesses are hiring. Mobile Health recommends all businesses to use an employee screening program to attract only the best talent. Credit checks are not vital." (Reference: virtual-strategy.com/2013/03/11/america%E2%80%99s-economic-comeback-requires-qualified-candidates-job Retrieved 4/15/2013.)

Employment Related Bills Pending in Florida’s 2012 Legislative Session: Senate Bill 102 and House Bill 303 will prohibit employers from directly or indirectly using a job applicant’s personal credit history as a hiring criterion, except where required by law.

— Examiner.com/workplace-issues-in-orlando; 2012

January 2012 - New workplace rules cover credit checks, social media. Ventura County Star - California employers and employees have a variety of rules to learn with the enactment of new laws that cover

  • credit checks,
  • dress codes, and
  • social media.

More than 120 business owners, managers and human resources officials gathered to examine the matter and its possible results.

Possible Proxies for Employment Discrimination

In certain states, some companies may be advertising in their job postings that "The unemployed need not apply." A number of agencies have posted that their opinion is that this is also discrimination and EEO actionable.

SB 1045 - Job Applicant Fairness Act

NOTICE: Another Tack

In certain states, some companies may be advertising in their job postings that "The unemployed need not apply." A number of agencies have posted that their opinion is that this is also discrimination and EEO actionable, because unemployed applies more frequently in the 2010s to "older workers", "minority race workers", "physically and mentally challenged workers", and perhaps even "female workers." Thus, "unemployed" in this case is a proxy word for "minority."

Iliinois Governor Signed Law to End Pre-Employment Credit Checks- August 2010

Proxy for Other Discriminatory Options

It is not legal in a job interview to ask where the job candidate lives or with whom, unless the candidate is a minor child. Asking these questions of any adult gives the interviewer some information about the demographics of the job candidate, none of which is to be asked or exposed in the job interview according to labor law/EEO.

A home address is subject to search on a number of real estate company websites and county property records, revealing the average property prices, rental prices, and incomes of local residents. The address can also reveal the ethnic and faith mix of the area, found on Sperling's Best Places. It reveals the percentages of single and married people in the area, educational levels, and other data. Except for educational level (dates not allowed to be asked), all of these questions are illegal.

At least 25 US State Legislatures in 2010 and early 2011 prepared bills with which they planned to ban Pre-Employment Credit Checks in order to end financial discrimination and allow more people to secure employment. Credit checks in these states were considered unfair to laid off workers, those with high medical bills through no fault of their own, and people that lost their homes in the US mortgage and banking disaster of the late 2000s. There is some evidence that suggests that financial discrimination also targets lower-income workers of color and ages over 40 (laid off/downsized). Pre-employment credit checks can, therefore, function as a proxy for discrimination on the basis of income, ethicity/race, and age.

Another, newer, credit check problem is the growing number of people targeted for Identity Theft and its results.

Congressman Steve Cohen testified at a House Financial Services Subcommittee

Credit-Check Lawsuits and Precedent

Individuals applying for promotions in their careers have reported across the Internet that when they checked their credit histories, they found unexpected information. Their employers had run credit checks on them during the period of interviewing for the potential promotions. These individuals felt violated.

Lawsuits have been pressed against credit checks in the following cases:

Loudy Appolon filed a class action suit (Reference: privacyblog.littler.com/2010/12/articles) against the defendant University of Miami and the Leonard M. Miller School of Medicine, stating that these institutions ran credit checks in a way that discriminated against African American and Latino job applicants.

The plaintiff was hired by the schools, quit her job at another university in Miami FL, then was told she could not be hired by the U of M facility, because of her poor credit report. The report was mistaken, she had it corrected, and she was still not hired by U of M. She seems to feel that the credit report reason for non-hire was a proxy for her demographic as African American. Thus, the class action suit (some of the allegations were dismissed by the court in March 2011). This is one of the cases that sets a precedent for Credit-Check Discrimination.

Additional lawsuits of this nature have been filed against such companies as the following, although ruling results are not complete:

  • Freeman, a Dallas convention and corporate events planning company
  • Kaplan HIgher Education Corporation

(Reference: http://www.law.com/jsp/article.jsp?id=1202486450121&slreturn=1&hbxlogin=1)

© 2011 Patty Inglish

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    • profile image

      Cathyp 3 years ago

      I am so angry here in Philadelphia PA I was employed by a company that was in the twin towers they opened an office in Philadelphia it was a computer hardware, software sales and repair business.I was getting paid very well as I was the office Manager and these employers were the best employers I ever worked for.They all died in 9/11 and we lasted a few months but since the funding came from our coorporate offices we could no longer get payments for our job or pay anyone including the bills. We thought that we would go to New York and find out what happened it was a long time before we could get to ground zero to find out they all died.I was making a very good income so I had several credit cards and living a good live stile never expecting this.I tried to find a similar job with the similar pay but for some reason I was never given the opportunity.I had to work two to three jobs to try to make ends meet in humble jobs because every time they would run a background check my credit check was not good.I try to explain to the people that I was trying to survive with three jobs two part

      t ime jobs and one seasonal jobs.This would only provide for what I needed not for paying student loans and credit cards and medical expenses because I would never get any medical on the part-Time jobs I was getting paid 10.00 and hour or 9.00 and hour and just praying to God that things would get better and I could find a good job as I have a bachelors degree and I still owe students loans.I am so sad to report that I have worked in Non profits expecting to get a good job at least 35,000.00 a year and the most that I have gotten paid is 12.00 an hour. I would work these jobs hoping it would open a window to something better but all I got was contract jobs and temp jobs.After serving in Americorps for just a stipend I thought that maybe this would help me resume look good( and I love to help people) I am 54 years old and it is 2013 going on 2014 I do not owe as much in the student loan but I still owe credit cards.I am hoping that something will turn up before I retire that can get me back on my feet because now I have two grandchildren that I am caring for as well(providing for).I called one of the collection agency in tears asking them if they could hire me and they could charge the money I owe in the very check that they are paying me but I could not get a deal going.I later found out in the n on profit agency that they turned me down because the person who is HR worked once for one of the banks that i owe (Credit Card) as she ran a credit check. How am I ever going to pay if no one is willing to take a risk in hiring me hey I want to pay i do not have the money I do not make enough.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 3 years ago from North America

      In at least 25 US States as of December 2013, credit checks for employment are becoming or already illegal.

      In an at-will employment State in America, without a contract with the employee, an employer could do just about as he pleased; but credit checks for jobs and promotions are becoming illegal, causing grounds for lawsuits.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 4 years ago from North America

      Exactly so. Hopefully, many more states have outlawed credit checks.

    • KatNance profile image

      KatNance 4 years ago

      Why is credit history of any relevance to the potential of a job applicant? are WHY r they trying to make it even harder to work..I know someone thats a police officer..he has GREAT work history..but wouldNOT hire him base on his credit..He has kids,,HOW is a Family supposed to make it and now hes living ON THE STREETS

    • profile image

      Mr Richard Lum 5 years ago

      I live in England/United Kingdom and it has made my life a living hell over the past few years e.g, being rejected for working in a bank for having debts back in 2010. Currently in the process of trying to get a good job and guess what the pre-employment check is still in progress nearly a week after passing my interview for the job. I think this type of discrimination is totally unnecessary and immoral and it has probably contributed to my current depressive state which I would like to say has been stabilized by medication from a doctor! I think more emphasis should be on people who have committed crimes and much much less on someones credit history. These laws in my eyes are criminal and they are damaging the lives of otherwise healthy, intelligent and hard working individuals.

    • Marble Sweets profile image

      Marble Sweets 5 years ago

      The fact that this hub has so many comments shows what an immense problem this is in this country right now, and how so many people, including yours truly, feels discriminated against with these credit checks? Why is credit history of any relevance to the potential of a job applicant? I never, ever will get that...And yet, if you don't sign off on the form giving the employer the right to check your credit, you automatically don't get the job. Like so many have already said here, it isn't right! Steph in South Carolina

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      I am extremely sorry that happened to you Jenna!

    • Jenna Pope profile image

      Jenna Pope 5 years ago from Southern California

      In 2003, my credit was checked when I applied for a job. I was going through a messy divorce at the time. So my credit was not up to par. I didn't get the job.

      This was a very informative article! Voted up!

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      The credit record problem is worsening, and I am hearing it from all around the country. Credit checks just don't turn up what many employers think they do. For instance, one large company here received an excellent credit report on a woman that embezzled huge amounts of money.

      Gulf Coast Sun - Even though parts of Florida have a lot of job listing, people don't seem to be getting hired. Senior Citizens are getting hit financial in ways they never expected. Best wishes to you.

    • Gulf Coast Sun profile image

      Gulf Coast Sun 5 years ago from Gulf of Mexico

      Thank you for a wonderful and informative article/hub. Living in Florida, which is in such a depressed job market and housing market has thrown many of us into the unemployment lines, thus losing our homes. There are no longer classes of people: rich, middle class, and poor. Now it's the rich and the rest of us. It would be helpful if those of us in the situation, who worked for 40 years, put kids through college and ready for retirement, can have our credit scores redefined as not bad credit, but rather as "economy-poor-due-to-market-problems."

    • profile image

      Melissa 5 years ago

      Even as an Accounting and Finance person, I don't think my credit should be considered. The issues with my credit are not necessarily due to decisions I've made. They are due to extenuating circumstances, that I regret, that would never enter into decisions I would make for my company. I have bad credit. Yet, if I find a penny laying in the change machine - I turn it in. I'm not unethical or crooked or any of those things. I've been naïve and made mistakes. I'm great at my job, and I always put the interests of the company first. I don't want to be discriminated against either.

    • Brandym2012 profile image

      Brandym2012 5 years ago from PA

      Thank you for sharing this hub! With all the talk about foreclosure's and bankruptcy's in the media the past few years, why would they even consider taking that route. Maybe a law needs to be put in place on this issue. Just don't seem fair to our hard workers, considering the big people in power are behind the economical disaster.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      I am very sorry all that happened to you. These credit checks can cause tremendous havoc and unnecessarily so. Additional notices of legislation in other states shows up on Google and Yahoo, but it seems slow going still.

    • Lisas-thoughts101 profile image

      Lisas-thoughts101 5 years ago from Northeast Texas

      great hub. Very discrimatory. I am glad to see Texas as one of the states ending the practice. My son was the victim of a violent crime and was in the hospital for three months hours from our home. I was off work 2 days a week driving back and forth. I had the time off work, the medical bills and the high credit card bills in gas and lodging. Credit turned to mush. Then my boss of 11 years died and I suddenly had to look for a job. It was horrible. And almost impossible with the credit check and a deceased reference because of a single shingle law firm. I finally took a job that is way under the pay scale I was making. Hopefully this will mean I can work my way back up.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      A big ladies and gents clothing mfg and dist. concern in my city was doing these checks QUARTERLY for several years on existing employees. Their resulting staff turnover was very high without good reason.

    • Hady Chahine profile image

      Hady Chahine 5 years ago from Manhattan Beach

      Great article! Pre-employment credit checks, with few exceptions, is a total invasion of privacy and absolutely discriminatory. What's next…annual credit checks for existing employees? Good or bad credit does not define a person's ability to perform their job description effectively and efficiently.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      I feel that is it usually an invasion of privacy, unless perhaps done for an armored car service or a bank.

    • TotalHealth profile image

      TotalHealth 5 years ago from Hermosa Beach, CA

      Great hub! I totally agree. The majority of credit checks for employment purposes are completely irrelevant to the job description. Unless a person is being consider for a senior management or accounting position, in which their decisions impact the health of the company or have direct access to money, then this requirement should be illegal. ~ It’s invasion of privacy.

    • leros003 profile image

      leros003 5 years ago from Orlando, FL

      Thanks for the info! This will definitely be an interesting year for politics, especially with the upcoming presidential election.

    • divyananjappa profile image

      divyananjappa 5 years ago

      A friend was (and still is) on unemployment for over a year, he maxed his credit cards while taking cash advances out to pay for his car payment and insurance.

      He thought he would find a new job within six months.

      Wrong.

      So after maxing his credit, and no job in site (Michigan has a horrible economy,) he was left with facing foreclosure, maxed out and late credit cards, and bad credit.

      Now each employer he interviews with wants to run background and credit checks.

      Really?

      Chicken or the egg.

    • ThePelton profile image

      ThePelton 5 years ago from Martinsburg, WV USA

      Cloverleaffarm, you mentioned divorce. My Mother divorced my Father when I was sixteen, and he left with the credit rating she had worked to build for the both of them. He quickly ruined that rating while Mother worked her way up from nothing like she was just graduating again.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      Excellent advise that looks into the underlying strata, cloverleaffarm. Thanks for helping us with the conversation here.

    • cloverleaffarm profile image

      Healing Herbalist 5 years ago from The Hamlet of Effingham

      I agree with Peter Lumetta, credit scores are a Scarlett letter that many don't deserve. There are so many circumstances that come along in life, where you are thrown off course. Major illness is one that can put you in ruin. I would think it horrible not to hire someone because their wife had been ill. It is not due to their fault.

      Or how about the women who is divorced, and her credit score was ruined by her husband. It is her fault? No. But, she would find it hard to find an apartment, or a job if she was only looked at as a number.

      As a past employer, I looked at references, not numbers. If you worked hard, it was not my business what you did at home.

      I know I hate being rated as just a number. It is an unfair practice that should stop. More people would be able to work.

      And to nadejshda , why not hire an accountant with a bad score. His score does NOT reflect his work. I could reflect the fact that his wife underwent chemo, and they lost everything. Or perhaps he went through a divorce and it didn't go well. This divorce does not reflect his intelligence to do the work, it just means he had a lousy lawyer.

      One should not judge others. You never know when you will be in their shoes, and someone will be judging you by a number.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      Feels like it, doesn't it?

    • ThePelton profile image

      ThePelton 5 years ago from Martinsburg, WV USA

      I can understand that some employers would like to thin the ranks of applicants if they have but one job, and a hundred applications. However, I have been running out of money, and I need work, and I'm wondering where all this is leading. First our credit rating, then our twitter accounts. What next, prostate exams?

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      If Republicans support the concerns of business more than they do other groups, then they would likely want to allow businesses to examine job candidates in any way possible. I want fairness to both sides, employers and employees, but credit checks are not related to work ethic or results in the largest majority of cases. That's all there is to that.

      NOW THEN, If I knew a job candidate uses dirty language, sexist slurs, and hate language; and arranges drug deals and murders on Twitter, then I don't want that person attempting to work for me. Actually, I don't want that person around me and I won't have them around me, so I make sure I am not an "employer" of others than volunteers at this point. What's in the heart comes out the mouth and the lie that character and behavior are separated and not related must be extinguished.

      As for me, I speak and act the same no matter where I am, online or off, so I would have nothing to hide, but passwords to Twitter and FB are really no one's business and can lead FAST to ID Theft!

    • ThePelton profile image

      ThePelton 5 years ago from Martinsburg, WV USA

      Recently, I read that the Republicans in the Colorado State Legislature voted AGAINST making credit checks illegal in job applications. Keep that in mind on election day! I also heard the other day that some companies are asking for access to an applicant's TWITTER account.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      I like the way some dental practices choose new employees as technicians and assistants. They try out each candidate that looks good and has a good interview, giving them a full day's work experience with pay. The best one on the floor with the most productivity and people skills wins the job. No credit checks.

    • profile image

      mikeydcarroll67 5 years ago

      Hopefully this goes a ways towards helping us that are struggling. I feel like I have to lie to employers about my credit history and that isn't right. Maybe this is a step in the right direction towards helping to get the economy back on track.

    • profile image

      khmohsin 5 years ago

      That was a great Post. Please keep writing because I love your style of Post.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      Thanks for that good information! We are making progress.

    • profile image

      PWalker281 5 years ago

      Hawaii is another state that bans (with exceptions) pre-employment credit checks.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      The sooner it ends, the better! Thanks for your experiences, PWalker281.

    • profile image

      PWalker281 5 years ago

      It's good to know this trend in pre-employment credit checks is slowly ending. I remember applying for a job with the Fed. gov't and being asked on the application about my credit (e.g., past bankruptcies, moneys owed the IRS). I was shocked to see it as I had worked in Federal EEO some years prior and felt it was not only discriminatory but an invasion of my privacy and had nothing to do with my ability to perform the job. Of course, I wanted the job and answered it anyway. That was about 20 years ago. If that happened today, I would probably refuse to answer it, even if it meant not getting the job.

      Thanks for this informative hub. Voted up, useful, and interesting.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      It seems to be a menu of things that get in the way, right? Thanks skinsman82000.

    • skinsman82000 profile image

      skinsman82000 5 years ago from Frederick Maryland

      Anything that can prevent potential employers from discriminating against you is a plus in my book. America has in the past always been known as a place where you can make something of yourself out of nothing. It's been going the other direction for a while. This is a step in the right direction. Now only if they could abolish having a 4 year degree and 8 years experience for an "entry-level" job.

      Great article. Voted Up.

    • Express10 profile image

      H C Palting 5 years ago from East Coast

      This is an informative and useful article. It is not uncommon to find that employers use credit checks as a reason to discriminate, lower the number of applicants who will actually be considered (decreasing their workload), and as a way to simply nose around the job applicant's life and habits. Many positions require credit checks even where the applicant will not have access to money, confidential info, or financial information.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      That is exactly right. One cannot battle on forever in a dead situation. My best to you!

    • profile image

      Beachelf 5 years ago

      Patty-

      That may have been it. I had my college diploma, transcripts from school, and references from colleagues, employers, and parents of students. Apparently, not good enough. At some point you have to say, "enough" yourself.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      A private family? They must be afraid of a person pretending to be a tutor in order to get into the home and steal. Incredible.

    • beachelf profile image

      beachelf 5 years ago from Virginia

      So, anyone know if Virginia has banned this? I know Geico does credit checks. And I had a private family refuse to interview me to teach their Autistic son because I wouldn't sign off on a credit check. Pretty soon, you'll have to post it on your front door or they won't deliver your pizza.

    • profile image

      nikashi_designs 5 years ago

      Perfect Hub full of great information and one that is of great concern to most of us. Never understood why a credit check was necessary for employment. With this knowledge it might be wise to get some kind of credit alert set-up. This would be beneficial for two reasons pre-employment checks and identity fraud. Regardless great information.

    • The Corniwhistler profile image

      The Corniwhistler 5 years ago from Kansas City Metropolitan Area

      Thanks for this information. I'm currently out of work and my credit's been a worry of mine. I look forward to follow up.

    • GoGreenTips profile image

      Greg Johnson 5 years ago from Indianapolis

      Good Hub! This is a great thing, companies have increasingly infringed on the rights of the citizens and it frankly just isn't right.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      It's something old about good people never having money problems, never getting sick, never being stalked, never getting divorced, etc. - a set of myths used conveniently when needed.

    • RJ68 profile image

      RJ68 5 years ago from Memphis

      I just do not believe that poor credit history is indicative of work ethics...I am not sure where the concept came about but it is discrimination.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      All very good points. Every time credit is checked, this check appears on the credit report and can be very hurtful if a dozen employers check and do not hire the person. Checking credit leaves bad credit records!

    • imatellmuva profile image

      imatellmuva 5 years ago from Somewhere in Baltimore

      I am a strong advovcate against credit checks on employees and/or potential employees. Credit criteria is subjective, and company's who are not reviewing a credit report for the purpose of lending, have no right to information contained in a report, and further lack the qualifications to review a report.

      Even if a credit report is reviewed by a lender for a loan, each lender's credit criteria is different. The same is true for an employer, or potential employer.

      Some employers don't understand that multiple inquiries on a credit report, are because people are seeking employment, opposed to establishing credit. Too often folks are denied on this basis alone. AND even if an employer understood this; a credit report still should not be a part of a job review process.

    • Marcy Goodfleisch profile image

      Marcy Goodfleisch 5 years ago from Planet Earth

      Very interesting hub, Patty - thanks for sharing the information. Voted up and interesting.

    • profile image

      askme 5 years ago

      Now...if employers will actually follow these new laws. Checking someone's credit is a relatively new thing in the last 10 years. When I started working in insurance back in the late 1970s, I cannot recall any employer checking my credit. Plus I've always thought someone with bad credit obviously NEEDS a job and thus would probably work much harder than co-workers who have stellar credit. Hope employers will abide by the law.

    • girlgonestrong profile image

      girlgonestrong 5 years ago from Plymouth, MI

      I'm glad that this will be done away with. We can leave the minority thing out of it. Credit checks still should not be the basis of employment. Seriously. You might have been looking for a job for months and the little bit of coin that you have dries up and you start missing payments. Now that you have a job, things can get back to normal...but oh...you can't GET a job because of the dings on the credit report? Makes zero sense.

    • Marla Neogra profile image

      Marla J Neogra 5 years ago from Parkersburg, West Virginia

      Thanks for this posting. I was turned down for a job 8 years ago because I had a bankruptcy in my past. I was the most qualified for the job and the only one with an active top secret clearance so could have started immediately. Guess they had to wait a couple of months to get someone else in the position. I can understand anyone's frustration in this situation and am glad you brought it to the forefront.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      Additional states have introduced new bills to stem the tide of unnecessary credit checks for employment in January 1012, including Florida.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      I hope readers report in with more states that have passed the legislation to disallow these credit checks. Thanks for commenting!

    • Angela Kane profile image

      Angela Kane 5 years ago from Las Vegas, Nevada

      Good, I could never understand how ones credit history determined what kind of employee a person would become. This was very discriminatory and did not make any sense. I thought this was just another way to not have to hire people they didn't want to hire for "other" reasons.

    • teachertalking1 profile image

      teachertalking1 5 years ago

      Thanks for sharing such informative material! I've believed for some time now that credit checks are a blatant violation of privacy, and am happy to see that many states are making them illegal.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      I'm sorry to hear all those things happening to you, but you have good spirit! I hope HubPages is providing some income for you - best of luck and success!

    • David Warren profile image

      David Warren 5 years ago from Nevada

      Great hub Patty! I've been out of work for awhile, not related to the economy but due to multiple surgeries. Rather than do nothing I prematurely accepted an at home job for Alpine Access that I enjoyed but wasn't physically up to at that point. I barely got through their credit check prior to being hired on. Now that I have been out of work longer I know I would not make it thru their credit check now and I doubt that my outstanding service would mean a a hill of beans. Tough times indeed. I think my only chance in life is to recover fully enough to return to my original job I had prior to my surgeries as they know I didn't become unemployed due to the economy. Tough and unfair times indeed for all.

    • Rusticliving profile image

      Elizabeth Rayen 5 years ago from California

      Excellent Hub Patty! It's scary to think that you could be passed up for a job you need to pay off your credit debt because you have credit debt! Talk about your "Governmental Oxymoron!" What ever happen to the "Good Ol' American Integrity" of the workplace??

      Definitely voted up and informative!

      ~Lisa RusticLiving

    • Melanie Gladney profile image

      Melanie Gladney 5 years ago from Pennsylvania

      Excellent hub. This "Big Brother" mentality of checking into citizens' backgrounds is positively archaic. I can understand companies wanting to protect themselves, but for a person who fell on hard times and desperately needs to turn his/her life around, such measures could mean never rising above one's unfortunate conditions.

    • LoriSoard profile image

      LoriSoard 5 years ago from Henryville, Indiana

      Great hub. Perhaps a person with bad credit is attempting to get a better job or second job to pay off debt. I am glad for the elimination of credit checks. I think it is an unfair practice and none of the employer's business. The only occasion I can see where it might be important is if an employee is handling the company's money.

    • kxdorey profile image

      kxdorey 5 years ago from Beverly Hills, California, USA

      Awesome hub. I think that part of the problem is the government is always regulating this. It may seem like a good idea at the time but it prevents free markets. Just look at the bank bailouts which will cost the average citizen $50,000 in taxes in their lifetime. Not spending that money is economic recovery for most people.

    • moonstruck4ever profile image

      moonstruck4ever 5 years ago from somewhere in upstate New York

      I just found you and will be following!

      Very informative! Thanks!

      Voted up!

    • Daisy Mariposa profile image

      Daisy Mariposa 5 years ago from Orange County (Southern California)

      I read somewhere that if you have less than outtanding credit, and there's a good reason for it, you should be pre-emptive and explain it in the job interview.

    • teenboyproblems profile image

      teenboyproblems 5 years ago from Nebraska

      Awesome hub. Thanks!

    • profile image

      Mopsy 5 years ago

      We all could be one paycheck away from homelessness. It is so very sad and maddening at the same time that this is actually allowed to happen in this country. Why are companies even allowed to do this is beyond me. I hope that the practice of credit checks is stopped once and for all. Next thing you know a person will be denied healthcare due to bad credit.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      -- like the president and vice president making their IRS returns public each year.

    • gabgirl12 profile image

      gabgirl12 5 years ago

      If its for public service however I think credit checks should stand. For the most part because if you are working for the public it's important to lead and live by example. I can accept that, as working as a public service to me is a priviledge of serving, not just a job.

    • TropicalSnowAngel profile image

      TropicalSnowAngel 5 years ago from Orlando, FL

      Very informative! I am glad to hear that this is being looked at, especially now that so many are running into financial difficulties. I will say that for anyone looking for a job in the defense industry who may require security clearance, there will ABSOLUTELY do a credit check. Poor credit history is seen as a potential security risk. I guess they figure you may be more easily paid off to give up government information.

    • GClark profile image

      GClark 5 years ago from United States

      Voted Up! Very informative and timely article. Makes you wonder how many top qualified people aren't hired because of a credit check. No matter that they had top credit previously with property ownership and impressive employment history. Even if a state makes it illegal to use the credit check it would be easy for a company to base a decision on that without anyone knowing. Talk about hitting someone when they are down! Keep up the great writing. GC

    • jaywigz311 profile image

      jaywigz311 5 years ago from Orlando, FL

      This hub is very well done. How is someone supposed to fix their credit if they can't get a job to begin with, and the fact that employers eliminate job applicants due to unemployment is ridiculous.

    • Chef Joel profile image

      Chef Joel 5 years ago from International Chef

      Amazing hub very interesting and helpful

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      Thanks very much, Will1015. I bet the credit monitoring service could be expensive and hard to cancel from credit card charges.

      A friend had quarterly credit checks done by a credit/collections call center of a company that owned a dozen leading clothing chains. He felt that the company feared workers might steal credit card numbers. The company was sold a few years ago and I do not know of the ongoing credit checks are still done. I think it would be a lot of pressure put on workers.

    • Will1015 profile image

      Will1015 5 years ago from Brooklyn

      In my experience with "free" credit checks, I had access to credit scores from all 3 major credit bureaus. But, I had to sign up for a 14 day trial of the credit monitoring program - which automatically starts charging you monthly if you don't cancel.

      On the topic of pre-employment credit checks, I was once denied a job as a customer service rep at a call center for AT&T. Their explanation was that individuals with bad credit are more likely to be desperate for money, and therefore more likely to steal from the company. That was about 5 years ago when the unemployment rate was about half of what it is now, and not as many people were bad financial situations. So maybe there was more truth to their argument back then, but now there are lots of honest, hard-working people who are struggling financially.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      it is my hope that pre-employment and after-employment credit checks be eliminated coast-to-coast, although I can understand them in banking.

      Another thing that seems wrong is that you can get a free credit report yearly, but it contains no credit score. You have to pay additional for that. Has anyone else met with that situation?

    • RGNestle profile image

      RGNestle 5 years ago from Seattle

      I really liked the information you used here. I have been denied work on numerous occasions due to my credit score being used against me.

      When I was starting out, I had a terrible credit score and I couldn't get work in the banks to which I had been applying. Of course, I didn't find this out until later when I requested my credit score after being denied a credit card.

      It's amazing that three separate, secret systems of turning a person's financial life into a set of three digit numbers can dictate where a person can work and what a person will pay for insurance. What does a person's credit score have to do with how healthy they are or how well they drive. It's insane.

      I am so happy that it's being done away with.

      Keep the great Hubs coming. Your fans will keep reading!

    • uniquearticlesbuz profile image

      uniquearticlesbuz 5 years ago from USA

      Great Hub, Thanks for this useful information.

    • kcamp01 profile image

      kcamp01 5 years ago from Anniston, Alabama

      Thanks for this information. Ironically, when you lose employment you potentially face financial strain which will decrease your credit score at a time when you need employment the most. I have always questioned this policy.

    • Sanford Rainey profile image

      Sanford Rainey 5 years ago from Maryland, USA

      How do you do it hub after hub after hub??? Amazing.

    • Womble profile image

      Womble 5 years ago from Suffolk East Anglia

      As I read more and more of this, I am appalled by all that has been going on. Frankly I am glad I am British and do not live in the USA for it strikes me as a merciless place to live and earn a living. What worries me that the Senator who is probably a democrat, will lose his position if and when the Republicans get in and they could not care two hoots about anyone.

    • sharewhatuknow profile image

      sharewhatuknow 5 years ago from Western Washington

      Credit checks are an extremely unfair way to gain "insight" of an individual.

      Suppose that a person lost employment and couldn't pay their bills due to severe injuries suffered in a car accident? This did happen to me back in 1995. Up until then, I had excellent credit with GMAC, Suzuki, MasterCard, Lowes, JCPenny, etc...

      And in one day, that all was lost. In that time I never did file bankruptcy, but my husband of almost 5 years has file bankrupty 3 times, before we were married.

      Now married to him, always wondered how that would affect me with credit checks, since we live in a community property state.

      Thanks Patty for making me feel a whole lot better!! Voted up and useful.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      MikeNV - Scary stuff! Thanks for your hair-raising experience.

      A friend of mine set up auto-payments from their checking acct. for a credit card. Then the credit card company called his wife and got her to write ANOTHER check. Unscrupulous as can be and negative credit reports even though always paid on time.

      Hillbilly Zen - Thank you so much for visiting here. I love your phrases! America is supposed to be a land of opportunity, but it is also a good place to starve to death. Thanks for your insights!

    • Hillbilly Zen profile image

      Hillbilly Zen 5 years ago from Kentucky

      What an eye-opening Hub! Since Kentucky is an "at-will" employment state, I've dealt with some of the most reprehensible hiring practices there are, but I had no idea that a credit check was among them. Thank you, Ms. Patty, for this very useful information. This line from another Hub of yours really frosted my flakes - 'the company management felt that the workers had nowhere else to go and were "stuck."' They've got us over a barrel and they know it, but armed with knowledge like you've shared here, maybe we can fight back. Voted up, awesome and useful!

    • MikeNV profile image

      MikeNV 5 years ago from Henderson, NV

      It's very easy for any company to report you to a credit Bureau. And they do NOT have to prove anything. The burden of Proof is left on the Consumer.

      Case in Point: I Called T-mobile to cancel my service years ago. At the time I was fully paid on the account. T-Mobile had my credit card number on File and continued to bill me. I called them and told them to stop. They did not. I filed a claim with my Credit Card company and had the charges reversed.

      You would think that would be enough right? Wrong. AFTER this they sent my account which was paid in full to collections.

      I contacted the 3 large Credit Bureaus and provided them with my Credit Card Company reversal decision and they have still refused to remove the charges.

      I told them they need to contact T-Mobile to prove that I used services which I did not.

      To this day it's still on my Credit. And the Credit Bureaus do NOT care. Trying to contest these charges is a nightmare. The Credit Bureaus give you maybe 2 lines to write. No way to provide proof. So you have to do it through the mail. I did all of that and still no results.

      The credit Bureaus do NOT want to help you. It's nearly impossible to get ahold of a real person.

      Corporate America WANTS PEOPLE TO HAVE BAD CREDIT because they Profit from it. The worse the credit the higher the interest rate. And Corporate America is making a lot of extra profit by screwing over the masses.

      So it is very important that people try not to give anyone their credit cards for auto billing, and try not to use them at all if possible.

      I would bet that if an audit were done of the Credit Bureaus we would find that there are error on more than 80% of all records and these errors are NEVER in favor of the Client.

      Furthermore the Credit Bureaus sell Credit Scores to consumers but the numbers they report to consumers are DIFFERENT than the numbers they report to lenders. It's a total scam. Credit Monitoring is another Fraud.

      The Federal Government REQUIRES that these reports be made available at no cost once per year. There is only one website you can do this on... The one the Government REQUIRED them to set up. It's Annual Credit Report dot com with no spaces.

      This is the only FREE way to contest your charges online.

      And while I believe the States are well intentioned and this is good news in relation to hiring, I do not believe that large corporations will stop the practice until there is a massive lawsuit. It's like driving 60 in a 55 zone, the law doesn't matter until it's enforced.

      Excellent hub... as usual. Voting up.

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      Charles - News reports state that is is law, but call your state govt or the local labor board to find out for 100% certain.

      GoGreenTips - I agree.

    • GoGreenTips profile image

      Greg Johnson 5 years ago from Indianapolis

      Great Hub! Well researched and written. I think it is totally inappropriate for companies to do credit checks, its has no basis for how well a person will do at their jobs. In today's world it's hard to find anyone that can keep up with the costs of everything anyway.

    • Charles Webb-it profile image

      Charles Webb-it 5 years ago from Edmonds,WA

      So is this now illegal in Washington state? has it been passed into to law?

      thanks great Hub!!

    • Patty Inglish, MS profile image
      Author

      Patty Inglish 5 years ago from North America

      Charlie - Experiences such as yours add reasons for pre-employment credit checks to be eliminated in this country. Thank you for telling us about your situation.

    • profile image

      Charlie 5 years ago

      I have been victimized by pre-employment credit checks - here is my story -- I worked for a large company for over 10 years, got "reduced in force" (laid off) in 2008 -- started my own business with my wife, ran into some financial issues and got behind on some payments, which resulted in credit blemishes. We ended up closing the business down when we realized were chasing debt and not generating enough revenue. So, I went back to my old company, gained an interview, aced it, and was offerred a job "contingent on a credit check and criminal background check". Criminal background check? No problem - but a Credit check? Well, long story short, I did not pass their criteria for good credit. When I asked what the criteria was, they said nothing. Now, this is such an obvious example of discrimination, but here in NC they say it is not. So what happens now that I can no longer secure my old 100K salary at my old company? I look for another company. But the same pattern persists from job offer to job offer - "Can't bring yo on board until you pass our credit criteria". "What's your criteria?", I ask....no response. How can I meet a goal without knowing what the goal is? Is it an 800 credit score? Never had it, never will. I ended up in fast food making $12 bucks an hour wondering where my life went....a far cry from $50 bucks an hour...I feel quite discriminated against.

    • Patty Inglish, MS profile image
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      Patty Inglish 5 years ago from North America

      I'm not an attorney, Stephanie, but Arkansas does not look to be one of the States in which pre-employment credit checks have been eliminated yet. I'd suggest a free telephone consultation with a local labor or employment attorney to see what you can do.

      From the credit reports I've seen, I'm guessing (don't know for sure in your case) that the bank was possibly focusing on the amount of total debt you have, how large your monthly payments are, how many creditors you have, whether you requested any accounts to be closed or whether any creditors closed your accounts, how many creditors accessed your credit file to see if they could benefit from offering you new credit accounts, etc. You could ask the bank's HR dept. but I do not know if they will tell you specifically.

      Let us know what you find out, if you'd like to do so. Best of luck to you!

    • profile image

      Stephanie 5 years ago

      I live in Arkansas and I recently applied for a teller position with a bank. I was laid off in July and can't find a job for anything. The bank turned me down due to information in my credit report. My credit score is fine so I'm not sure what the bank's problem is. I want to know if it is legal for them to turn me down for employment.

    • profile image

      SanXuary 5 years ago

      Being a financial advisor is irrelevant and so is any other job. If you do not have a job, try a divorce or how about a three year old daughter with cancer. Money is not your value in terms of what you know. I spared close to a thousand dollars to help others this month and that is not anyone's business what I do with my money. Especially, some employer who thinks they own me and my life like a slave.

    • iain-mars profile image

      iain-mars 5 years ago from United Kingdom

      good hub. i can see both sides of this argument, as an employer but also as a human being who can emphasise with people looking for work. pre-employment credit checks could potentially be singling out people that could otherwise be excellent employees.

      of course if you're a financial advisor, you really should have a squeaky clean credit record but i almost struggle to see the relevance to many other careers...

    • Patty Inglish, MS profile image
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      Patty Inglish 5 years ago from North America

      Thanks to everione that is posting comments here. Awareness of the issue and some outcomes is a good thing. I have known a few people whose credit was stalled and even ruined by the death of a spouse where joint accounts were frozen. Some accounts were seized for bills the surviving spuse new nothing about. Some surviving spouses had to declare bankruptcy.

      I have received messages from a just a very few employers that feel that even these unfortunate spouses I mentioned above must be deadbeats, dishonest,and potential theives. This is very sad. A good credit check does not guarantee good work habits, productivity, or honesty. A state college here had a case of an official that had good credit checks and almost 40 years of good work history; but she embezzled many thousands of dollars a few years short of retirement age. A non-profit ni the state fired and prosecuted an embezzler, but the person passed a good credit check and was hired by a govt agency - what's up with that? He did make resitution, so - second chance?

      Thanks for all the comments. I am sensing that oreand more workers are angry about credit checks and a number of employers are becoming angry with not being able to check out job candidates as much as they would like.

      A deli owner in NYC I knew never took inventories or logged in amounts of food items purchased. He wondered why he was losing money. Food was going out the back door. You know, there are safeguards employers can use - like doing inventories and tracking deliveries. And we have so many surveillance camers watching us these days!

    • Patty Inglish, MS profile image
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      Patty Inglish 5 years ago from North America

      Oksanaivanova - Thanks for reading and asking your Question. Can you give me links to a few blogs where you might post the translation? I'd enjoy viewing their content and love to read Russian.

    • mitowrite profile image

      mitowrite 5 years ago from Austin, Texas,USA

      I had no idea this was happening! But I guess since I haven't been working that long. Thanks for the info!

    • Oksanaivanova profile image

      Oksanaivanova 5 years ago from USSR

      We have the same problem in Russia. I'll translate it and post in different russian blogs (if you are not agains of it). Very useful and exiting theme. Thanks.

    • HrtsMakeFamilies profile image

      HrtsMakeFamilies 5 years ago from Independence, Kentucky

      I'm so glad to hear that they are making this change. I know several people that were turned down for jobs because of credit issues. I didn't think that was fair especially in the economy that we are in. Great article.

    • Karen N profile image

      Karen N 5 years ago from United States

      That's great news! To me it really seems like discrimination for them to be able to check your credit report in the first place.

    • Mamba79 profile image

      Mamba79 5 years ago from Los Angeles, CA

      I believe that pre-employment credit check should be banned. A person's personal finances especially if it was influenced by divorce, health, lay-off, etc, does not mean the person can not perform at a specific job. If you are a computer programmer and have the necessary skills to complete your job then what you did with your personal finances doesn't matter. Maybe he was young bought a house and market crashed. Does that mean the person can't excel at his new or current job?