Majority of Consumers Want Credit Checks for Employment Banned

Should credit history be used as a measure of employment? When the average American is asked, he or she will likely say, “No.” recently did a survey regarding this subject. While the survey did not focus directly on using credit for employment, 1,000 individuals were asked about laws banning credit checks in hiring decisions.

Out of this amount, 53 percent are for the ban, 39.3 percent have no issues with credit checks for employments, and 8.2 percent are undecided. The data from goes on to mention legislation to ban credit checks proposed in 2010; 33 bills were proposed in 18 states, and only two went through. For states that passed such legislation, credit checks are not banned completely from employment. Credit history may be screened for executive, financial, and other positions involving the handling of money or sensitive information.

Such legislation, then, could serve as a template for a national law, such as the Equal Employment for All Act.

The use of credit in employment has been scrutinized since the start of the recession in 2008. 60 percent of employers hiring screen applicants for credit, but how it is used varies with each employer. Because many have lost their jobs and ended up declaring bankruptcy or foreclosing their homes, those whose credit falls outside of the “good” range are blocked from employment – meaningful or otherwise.

Using credit history as a measure for employment can be discriminatory in some cases. As we have wrote on here before, minorities are disproportionally affected by credit and criminal background checks. Because of this, credit and criminal histories are not used as blanket measures for hiring and, in an ideal hiring process, are examined on a case-by-case basis. In such instances, any criminal charge or poor credit cannot automatically block candidates.