Right now, if you have a history of bad credit, or a criminal conviction, employers can pretty much throw you resume in the trash bin.
But there’s a growing movement in this country to discourage hiring managers from delving into your past. Some states are considering legislation to ban credit screening of applicants; and the federal government will soon be introducing new guidelines that will make it harder to use a person’s run ins with the law as part of the application process.
Employers argue they need this information to make an informed decision about an applicant, and to even keep the workplace safe. But such practices end up destroying people’s lives because they deny them a livelihood.
My colleague at MSNBC.com John Shoen recently wrote a great piece on how credit screening is impacting job seekers.
The story quotes Debra Banks, 54, who was denied a job because of her credit history, a history tainted by huge medical bills because she had been without insurance.
“I understand a background check,” Banks said. “But I can’t see how your credit relates to your work. I had more than proved my worthiness as an employee. I didn’t steal anything. I didn’t cheat. I didn’t do anything wrong.”
This is exactly the type of situation legislators want to protect working stiffs against.
About 16 states are now mulling legislation that would ban such credit screening. (Hawaii and Washington states are the only states where such screenings are restricted.)
This from Inc. magazine:
In most states, employers can check job applicants and current employees’ histories for overdue payments on mortgages, credit cards, loans, rent and more. Credit checks are viewed as part of a hiring strategy to prevent putting at-risk or untrustworthy applicants into positions where they could do harm to the company.
But opponents call the practice discriminatory and unnecessary.
Wisconsin State Rep. Kim Hixton proposed legislation banning discriminatory credit checks for jobs not substantially related to an individual’s credit history. He tells Inc.com that while he can see relevance of personal finances to the hiring of an investment banker, for a truck driver, librarian or gym employee, it’s irrelevant, and should be illegal.
And some believe certain screening practices may be used as a way to discriminate against applicants. So, if an employer doesn’t really want to hire a minority they may screen that individual hoping to come up with a prior conviction or something else in their past that can tarnish the application.
To deal with this, the Equal Employment Opportunity Commission is expected to come out with new guidelines in a year or so that will require employers to defend such screening practices by proving that they indeed have an impact on the job at hand.
This from Workforce Management magazine:
Employers spend billions on criminal checks and often base hiring decisions on the results without evidence of the return on the investment or the efficacy of the decisions. The absence of empirical evidence will soon become more than a question of effective screening and hiring practices.
Within the next 12 to 18 months, employers can expect to see the U.S. Equal Employment Opportunity Commission issue new guidelines that require empirical evidence for the “business necessity” defense in racial discrimination cases that arise from screening and hiring practices, according to Rod Fliegel, a partner at Littler Mendelson in San Francisco. The new guidelines are likely to upend hiring policies based on untested assumptions about criminality and workplace behaviors.
It’s all good news for employees who want to put their pasts behind them and earn a living. But it will make it harder for employers who often want to have as much information about an applicant before offering them a job.
What’s your take? Does a person’s skeletons in their closet foretell the type of employee they will be?
March 3rd, 2010 at 10:47 am
If the economy stays depressed for an extended period of time and more employers start using credit reports, employers will soon have a hard time finding any employees.
When they started using credit scores to set insurance rates, at least they had data demonstrating a correlation between scores and accident histories. [Though it should be noted that correlation does not equal causation.] In the case of screening potential employees, credit reports are a tool being used even though there is no evidence correlating bad credit with poor employment habits (e.g., absenteeism, theft). Credit reports in employment situations are being used as an excuse for maintaining social stereotypes, and to reinforce anecdotal sentiments.
My credit score has spanned the range over the years. It’s been below 580 and as high as the mid-700s. Life happens. Falling behind on some bills (or incurring huge medical bills that go to collection) does not mean that an employee will suddenly become dishonest or lazy.
March 3rd, 2010 at 11:28 am
In my case, if an employer screens my credit background, for another year or two a bankruptcy will still be on file. What will not be there is that I never missed a credit card payment in my life (to the best of my memory, anyway). The reason I became bankrupt is because a series of things happenned related to an illness/disability i have (mental health related) where in a short period of time i got into a lot of debt and also lost two good jobs in a short period of time. My illness is very much under control now, but either way it shouldn’t be discriminated against. And by discriminating against my credit background, they are in fact discriminating against my illness.
March 3rd, 2010 at 11:38 am
What an interesting observation RobW. In essence, employees can claim bias based on their disability. That’s one for ADA lawyers to chew on.
March 3rd, 2010 at 12:19 pm
This is off-topic, but I have to admit that wouldn’t end my employability issues, so the ADA lawyer is probably wasting time. The other half of the background checks occur where they do a ‘google check’ or whatever to see what you’ve done on-line. When i get into certain phases of the illness, I’ve been known to act like somewhat of a troll (once an academic referred to me in a paper as a “huge internet troll”) — which is to say i go into online forums almost looking for trouble. Also, I’ve gotten seriously paranoid in online forums, relating to symptoms of my illness. There is nothing i can imagine that they can legally do to prevent an employer from using a resource like bing or google. My illness is similar to the popular bipolar disorder but it’s a little more difficult to treat and is less well known, it’s schizoaffective disorder bipolar type. I’ve come to accept that I will never be employable again, at least for anything other than a minimum wage job.
March 3rd, 2010 at 3:15 pm
RobW, it is possible to work with search optimization consultants to front-load web searches with positive results. It’s a tactic most often employed when one shares a name with someone who has an unpleasant online presence, or when others have attempted to smear your reputation. That said, there are a few other things you can do:
1) Change your online name/presence/moniker and email address. Unless you posted under your full legal name, you should be able to distance yourself from your screen name(s).
2) If you did use your real name, consider using a variant (e.g., “Bob” instead of “Robert”).
3) As you establish your preferred online presence, always tie it to your name as you want it to appear. If you previously used “John Smith”, but now want to be “John Edward Smith”, be sure to use that name on all new online content, as well as your resume, cover letter, and any calling card.
4) Make sure potential employers know to search under your preferred name. You can do that with a brief note accompanying your resume and cover letter. It can be worded thus: “There are many John Smith’s in the world. To ensure your online searches find me, be sure to search for ‘John Edwards Smith’.”
5) If necessary, consider a legal name change.
Also, on a related note, it would be best if you did not disclose details about your condition on sites like this one. Such incidental disclosures can show up in search results, too. Employers are not supposed to use such information, but it is better if you don’t leave any smoking guns for them to find.
April 8th, 2010 at 6:22 pm
I pray that there is a change in the crimminal background check because everyone a second chance.