Potential Employers who run credit checks.

Your credit should have nothing to do with whether or not you make a good employee. I lost a potential job with Cingular because of my credit report had a bankruptcy on it and because I had a credit card and some medical bills. I don't think your credit report has anything to do with whether you can type or answer a telephone. It makes no sense to me.

I understand where you are coming from. I was unable to hire a number of good candidates at a prior job, due to their credit report.

Sounds like you were denied a job because of this. Were you up front about your credit report with your potential employer? In my former company, that made a world of difference.

I am not defending the employers, but there are a few areas where I can see the credit reports playing a role.

Unfortunately, the few bad apples .... employee theft is a very large problem that employers face. In the employer's eyes, someone who has good credit is managing their finances well and has no reason to steal. On the other hand, someone who has problems paying their bills/rent/car payment -- may be tempted to steal from the company to satisfy their problems. This is not to say anyone who has bad credit is a crook, but I'm sure you won't find any thieves who have good credit.

Also, suppose I am considering you for a position where you handle my money -- cashier, accounting clerk, bookkeeper, etc. -- As an employer, I may be inclined to say "if you can't handle your own finances, why should I trust you to handle mine?"

When we look at Equal Employment Opportunity, an employer cannot discriminate on the basis of sex, race, nationality, age. Nowhere does it say that an employer cannot discriminate against your previous credit history. If an employer has a policy in place that says a potential job applicant must demonstrate sound financial performance, then it is legal for them to deny employment if you have bad credit. The only way to change this, is to change the law itself.

Not only money, but other financial and personal information. Name/Addy/Phone/Employer/Credit Card #/Checking Account/etc...

True morningstar, wasn't thinking about that until you said it.

We've got about 20,000 unique individuals in our computer system, with their name/social/dob/dl# etc. If I was a devious person, I could probably go get some credit cards out in my customers' name. For this reason, my company has a bond out on me through our insurance company. If the insurance company refused to issue a bond on me, based on my credit, then my employer would not have hired me since I could not be bonded.

Look at a car dealership. If you are applying to be a car salesman, you better be able to drive a car. If the dealership's insurance refuses to insure you over a bad driving record, then the dealership won't hire you.

[quote]I was a devious person, I could probably go get some credit cards out in my customers' name.[quote]

And this happens every single day in America. The employer also must take into consideration the damage on his/her own business' (for example, negative PR) that could be done by an unscrupulous employee. Sure, you go through the interview process, but they still don't get to know the "real" you. So they:

Call your former employers
Call your references
Follow up on your resume
Check your criminal history
Check your credit report
Check your driving record

They've got to do their due diligence to minimize the risk any given employee poses to them. Unfortunately, decent people sometimes get caught in the middle. That's why it will never hurt you to be proactive if a prospective employer does credit checks, and let them know if you have any issues. If they still don't hire you, then either a) you cannot be bonded, b) the company's insurance will not cover you, and/or c) maybe you really wouldn't be a good fit in the organization, anyway.

Don't forget if you are denied employment based on credit report to get your adverse action letter from them and get your free updated report based on denial.

Can the background check include a credit check?

"but I'm sure you won't find any thieves who have good credit. "
Quote found in the above thread...
Um I know of several people who had darn near perfect credit who robbed a bank so that statement is very untrue...Having good credit does not make you a righteous or moral person....

Thanks for taking my words out of context. I wasn't implying that good credit makes a person righteous, or that bad credit makes one immoral.

BTW do you know these bank-robbers personally, to a point that you have looked at their credit report? I've never met a bank robber before.

I think it is just employers that deal with other peoples financial information that do this. They may be trying to check out your trustworthiness, who knows these days the employment arena is getting tougher and tougher. They can pretty much do what they want to for a pre employment screening.

I think as long as you are upfront about your situation, you will have a better chance (except as said above in situations where bonding or insurance plays a factor). I applied for a job a few years ago and when they told me they would run my credit I was sure I wouldn't get the job. I told them my situation, and still got a job offer.

The other thing I think sucks is auto insurance running your credit. What does that have to do with how you drive? I have a perfect driving record, but terrible credit. Luckily I've stayed with the same insurance company for years, so I got it before they started running credit. But I can't change now, or else my rates would skyrocket. My state even tried to make this illegal in the last elections. But the law didn't pass . . . .

But again, I say. I understand that they are wanting to look at this information if you work for a financial institution, but what does your credit worthiness have to do with a job for construction or for a job for customer service where you are not dealing with any monetary values?

I know that if someone is having financial problems it can interfere with their productivity. There is someone sitting by me who is on the phone and internet constantly trying to get out of her PDL and credit card problems. I know she has not put in a full 8 hour day for a month. Another co-worker is stressed out about his finances and misses a lot of work and is not quite all there when he is here. I feel for them, I have been down their road myself. But, if I were an employer I would never hire them. Financial problems need to stay at home no matter how much time is needed to solve them. So, I think a few people who have to bring it to work make it tough for those who go about dealing with their finances on their own time.

You go and apply for a job so you can earn a living and try to get bills under control and an employer say's sorry no job bad credit.Doesn't make any sense to me.

They worked for the same bank that I did and they drove nice cars and lived in big expensive houses and were top execs....wasnt tryin to take your words out of context...

I agree with both of you.

Have you ever noticed that there are people who know is in debt up to the wazoo and are still able to go out to the dealership and buy a new BMW or Mercedes, live in a $1 million home and afford to send their kids to private school.

But here I am trying to pay my bills and these individuals can get whatever they want. Life is so unfair.

But you know what? Some of those people are living way above their means..eventually it will catch up to them..So I am broke..big deal...Life goes on :)

I was once told by an prospective employer that good credit shows that you are responsible.

I feel like I'm a very responsible person. It's not like I had the money and just forgot to pay my bills. I kinda see what they mean, but unfortunatly credit reports don't show how the person got in the situation, just that they did. I think how the person got in the situation is much more telling then just looking at the report.

And now a days it is so easy to get into credit problems..I remember when I went to my first day of college and all these credit card companies are on campus offering you a credit card..Heck I didn't know a thing about credit then! I should have married rich...LOL JK But at least my husband has a job now(YIPEE) SO we might still have gas and electric next month

What I think sucks is that a few employers don't even TELL you that they look at your credit report. I mean how are you supposed to defend yourself in an interview if you don't even know that they are going to look at it?

I think some employers do credit checks for other reasons also. One is realiability. Insurance companies also do credit checks which effect your premiums. They think this shows how good of a driver you are.

I originated this post and I have read all the responses.

I still firmly and wholeheartedly believe that employers should be barred legally from observing credit reports for the sole purpose of hiring someone to do a job. Credit Reports were originally designed for loan decisions only and they were that way for many years until some business people decided to market them for other purposes. Bad people can have good credit, bad people can have bad credit. Good people can have good credit and good people can have bad credit. I work for a retailer and they run credit reports for people handling money and registers. They fire people all the time for theft even though their credit reports were good when they hired them. So, in my opinion they do the employer no good whatsoever. I have really bad credit at this time and I am not a thief, nor would I even consider stealing to pay my bills ever. The consequences of doing so are greater than not paying the bills. You could get caught, lose your job, go to jail, can't get a rental or place to live, etc. I'm sure many people are in the same position as I am. Bottom line, employers really should not be entitled to such private information especially when financial problems and bad credit can occur under a variety of circumstances that are beyond a persons immediate control. End of story!!!

Frank Chappell, you make some very valid points. I agree with what you are saying.

For certain types of jobs, the government believes a large amount of debt makes someone more prone to engage in espionage. Some employers think debt makes a person more likely to embezzle.

I think character, not debt or credit, determines a person's actions. I know a lot of good people who went through hard times and have a very bad credit report to show for it. Credit discrimination should be illegal. I know the insurance industry is getting sued over using credit scores because they tend to adversely affect minorities according to some recent class actions.

I applied for a position in the AP Department and was denied the job and asked to leave my position as a temp because my credt was bad. They did not even tell me that they were going to check it and when they did, they didn't even let me explain my situation but asked me to leave and the day and work week had just started. I had been temping for six months and then offered a job and then asked to leave because I had bad credit, they didn't even want to listen to my situation. Here I am trying to get a job to clean up my credit. I recently found a better job with more pay and I heard that the job that denied me are going under. Employees are dropping like flies. Serves them right.

I always say everything good or bad happens for a reason. It was awful why they let you go, but somebody had bigger and better plans for you and things worked out for the better for you in the end. You now have a better paying job and the company is going under.

I agree with texaslawyer. Mind you, I wouldn't want to have a bank manager with bad credit. But these clauses (to check credit) are sometimes in the applications for even jobs at the lowest scale, and seems almost a violation of privacy.