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03.18.10 The Rise Of Credit Check Use In Hiring Practices  By John VinsonIn states across the country, the practice of credit checks has affected both employers and employees. Businesses have increasingly been conducting credit checks on potential employees, many turning them down because of bad credit. Citizens have called upon the government to intercede on a practice which many deem unfair, and believe it should be made illegal. In Baltimore, Maryland the state government is deciding whether to adopt law which would ban credit checks from being used to hire or fire. Senator Mike Lenett of Maryland, opposes credit checks used for hiring, stating, "Credit reports were meant to determine credit-worthiness, not job-worthiness." He recalls examples of stories people have had dealt with the problem, "At the last minute having the rug pulled out from under them and denied a job on the basis of their credit report." Businesses who support credit reports claim the practice is needed to screen any potential liability risk. Their claim is that those with high amounts of debt are more apt to steal, and for certain businesses, theft can be a severe problem. Retail, banks, restaurants, and hospitals are places where credit checks are highly relied upon. The opponents of 'hiring related' credit checks state that credit rating has little to do with employees deciding to steal or not. In the current economic climate, many have bad credit for the simple reason of being unemployed. Therefore, why would they endanger their job status on theft? If anything, people with bad credit could make for potentially stellar employees. Another point brought about by those who oppose credit checks is that using the practice will extend the current economic crisis further than necessary. As more become unemployed, credit issues rise, but how can they be fixed if they aren't allowed to work again? Hence, the cycle goes on for longer than it would be without the credit checks. There have been compromises brought about, which would allow credit checks for certain occupations. Those who apply to work for financial institutions would be susceptible to a credit check, or any other position who directly handles money on a daily basis. While this compromise is liked by many, others still deem it unfair as a marker of character. One particular problem which many have addressed is how far credit reports look back. Most will dig as far back as 6-7 years. This can be unfair because a person's financial status can change quite a bit even in the span of one year. Especially for those who are younger, who might have had credit problems during or right out of college. The problem with credit checks isn't going away. While many sympathize with potential employees, the employers have a lot to lose in the current economic climate as well. They may not like the practice, but some businesses feel the need to try anything to keep assets secure. As a HR professional, it's vital you balance the various factors when deciding to pull credit on a potential employee. About the Author: John is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news. |
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