Discussions
Credit reports in employment screening?
Posted by Phoenix1962 • 5/08/08 • Subscribe to this Discussion [RSS] • Report This Topic
Tags: credit reports, discriminate, employment screening, minorities
Do you think that the use of credit reports in employment screening is just another clever way for business to discriminate against minorities? Tell me what you think?
User Comments
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No it's a clever way to discriminate against people who aren't responsible with their own money.-
So people who lose a job because of a company merger or acquisition, or have a catastrophic health crisis, or fall prey to the current mortgage-lending crisis are all irresponsible people and their ability to obtain meaningful employment should suffer because of it?
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BINGO! I strongly agree with csiunatc.
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Major corporations make irresponsible (remember Enron?) credit decision all the time and yet the government it not shutting them down they is able to move on with business as usual so why should it be different with an individual who mismanages his or her money in their personal life?
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Well, the government isn't "shutting down" people with negative credit report entries, either, is it? The government doesn't maintain credit reports, and the government isn't requesting the reports or making the employment decisions...I'm not sure I understand how this is comparable. People and businesses are, of course, free to decide not to do business with companies that have a negative track record, and many do. -
Quite a few major banks were accused of dishonesty in their collusion with Enron, shouldn’t those companies be held to the same standers as consumer? JP Morgan was accused of lending Enron money to help them cover up its insolvency. Although, JP Morgan, along with Citibank settled with the government investigators (for $300 million dollars) that does not excuse the fact that employees of the corporation made those unethical decisions that were deeply rooted in dishonesty. So who lost the two banks' money? We all know that the individual employees were protected by the corporate shield but how dare companies judge when this is the way they operate? See,
www-rohan.sdsu.edu/~rgibson/jpmorgan.html
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Folks in desperate positions do desperate things. Obtaining a credit report for hiring has been implemented in business practices for years. -
I've never heard of this practice, are you saying that, when applying for a job they want to see your credit report!!!!!! OUTRAGEOUS -
If you apply for certain jobs at banks or other financial institutions where you are advancing credit or providing financial advice, then yes, it makes sense to view how many foreclosures and bankruptcies you have on your personal credit.
I don't see how that's a swipe at minorities. Not to mention you have to give your permission before ANYONE can pull your credit - they can't do so without it. You are free to inquire as to their reasons for pulling your credit if you are suspicious. If you think it's an attempt to discriminate - then don't give the acceptance.
Seems to me though that you wouldn't need to pull someone's credit if all you were trying to do is discriminate against a minority - you'd be able to see what you were looking for in such a situation in a face to face interview.
Some jobs (particulalry those in charge of large financial portfolios) require frequent credit pulls by the employer.
If the employee feels they have been subjected to unfair practices, the best course of action is to contact the FCRA Federal Trade Commission 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 (877) FTC-HELP (877-382-4357)-
Thanks for clearing this up,:)
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kdawg, I don't believe that most employers DO use credit screening as Phoenix is suggesting, but I think his point was that it could be used as an EXCUSE not to hire minorities,not that an employer would need a credit report to determine whether someone was a minority (I kind of suspect that you knew that).
And, of course, you can always refuse access to your credit report when applying for a job, but that generally means that you simply won't be considered for the job, so if the problem Phoenix suggests does exist, it's hardly a solution. -
Being a racial minority in particular, and especially a racial minority with a long history in the United States, has more of an effect in a lot more areas of life than you would think. Look at it this way. Who's going to know more about working on a car, a random person off the street who's never looked under a hood in their life, or someone from a long line of mechanics who grew up playing in the garage while their parents worked? It's the same way with racial groups. If your particular race has always been in a disadvantaged position economically, you are probably not going to grow up knowing the ins and outs of personal finance to the extent that you would know how to pull yourself up by your bootstraps. You might not know how to budget, you probably would not know how to ask for a loan (especially if your race was historically discriminated against by banks), and you may have never looked at your credit report in your entire life. With results like these...
www.startribune.com/homes/11362941.html
Now, if a prospective employee is trying to get a job in the banking and credit industry or something similar where they are going to be looking at people's financial accounts and handling a lot of money, I can see merit in a prospective employer looking at an applicant's credit report. Similarly if the applicant's trying to get a job that involves national security, because a bad credit report is a weak spot that can be exploited by enemies of this country. (It's for this reason that the military keeps close tabs on servicemembers' financial habits. A soldier in debt is a very vulnerable soldier, especially overseas.) But for any other job, one's credit status is not a protected class under employment law and is therefore a loophole that prospective employers can exploit rather than directly rejecting the applicant explicitly on the basis of race.
So, in a nutshell, yes, it's possible this practice was put into place as a sort of backhanded expression of racism.
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I do think that it is discriminatory - no that's not the right word, I think it is an unreliable way to determine the average person's ability to do a job properly.
Mistakes that a person can make with regards to credit and finances stay on their credit report for a long time - so do problems with identity theft which is a HUGE problem lately.
The fact that you did something wrong (or financially irresponsible), perhaps 5 years ago should not affect and does not affect one's ability to work.
Furthermore neither the employer nor the credit bureaus actually know what went wrong, and therefore have passed a final judgment on a person by numbers alone. There is no room for explanation in the credit system.
Maybe someone defaulted on a loan because they got really sick, or a family member did, and it cost them thousands of dollars in medical bills and lost wages. Happens all the time (and, by the way is the leading cause of bankruptcy).
Maybe someone stole a credit card from you, and damaged your credit before you even knew what was happening (happens all the time).
The list can go on and on, but the employer won't see that.
For what it's worth, I never understood why a person who needs money to pay off debts should be denied a job because they need money. I hear "desperate people do desperate things" all the time, but denying them the ability to EARN money will make them more desperate, dontchya think? It perpetuates the cycle.
I think that baring jobs that actually require a person to handle, invest or deal with large sums of money - no credit check is required. If an employee turns out to be irresponsible - you fire them. If they steal from you - you fire them, and take tehm to court.
Credit checks can't actually tell you if a person is going to be a good or bad employee. They can't tell you if the person is a thief or not.-
I think part of the problem though, is that if you failed to do a thorough background check on the individual, that you may subject yourself to negligent hiring actions. If they wouldn't extend a loan to you, why should they let you extend loans to others on their behalf? That wouldn't make sense.
I don't disagree with most of what you are saying though.
Still, let's remember that anyone who fails an employment application process due to something that was disclosed on their credit report is supposed to be notified of the source of any information used against them (along with disclosures about their rights under the FCRA, etc.). Ostensibly that's so that you can clear up any false information that is causing you to fail employment screening.
Another way to look at is this - if you would fail the company's credit screening process if you applied for a loan (in which case your previous credit experiences most certainly come into play), why should they not impact that company's decision on whether or not to entrust you with financial responsibilites?
In my mind, the far greater fear I'd have is the employer seeing things on the credit report that they have no business seeing, that and giving anyone access to such detailed information about myself makes me squirm a bit.
But in a larger sense - can't the entire employment process be seen as "discriminating" against candidates you don't think are as good as the people you are looking for? It's all subjective. It can certainly be abused, but I understand why certain institutions do it - just like I understand why teachers are subjectd to thorough background checks (I think). -
Well, they are supposed to tell you why you weren't hired - but they often times don't give you any information at all. A lot of places just don't call you back.
I agree 100% with your second to last paragraph - but your points about getting a line of credit versus working for a company I don't agree with.
A line of credit is a contract of lending money, and then getting paid back. The company lending the money needs to make sure you are financially capable of paying the loan plus interest. Getting a job however, has nothing to do with whether or not you can pay the company
I do agree that background checks are a good idea. In fact I think it is a better idea than credit checks. Background checks allow you to see if you've been arrested (and charged), employment history, or if you've had any legal troubles etc... it gives you a clearer picture of the level of responsibility and character of the person you're hiring. Knowing that a perspective employee has been fired from the last five jobs, and isn't considered rehirable is a good indication that s/he isn't going to work out.
Knowing that a person is a sexual predator will keep them away from jobs that put the clients/customers and other employees at risk.
Credit scores just don't do that, in my opinion.
But I don't think it discriminates against any one specific group, per se.
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I have to agree with Kdawg here.
This is a tool, most companies use it as a PART Of the hiring process. For instance, I know that there are a lot of people with Bankruptcies on their credit that get past these checks because they have a reasonable explanation for why they declared. (in most cases divorce)
Like any tool, it can be abused. But so can anything else.
I've heard a claim that the actual Interview is a tool for discrimination since it can tell the interviewer things about the employee.
Age / Health issues / Gender / Race.. can all be ascertained at an interview.
Like anything else, Tools can be used or abused. We can't limit everything.-
Other than applying for a job that requires handling or investing large sums of money...what business does a company have knowing the spending habits, or unfortunate events, of a perspective employee?
And, for what it's worth, I've never been asked by an employer why my credit history is destroyed. I've never been given the opportunity to discuss or explain what happened. I highly doubt that most employers actually care to know, either.
The more I think about it, the more I think the whole of it is an intrusion on personal, individual rights. So long as I come to work everyday, and haven't been doing anything illegal - what right does a company have to pry into my spending habits? Even if I am irresponsible with my money, that is MY choice, and has no bearing on my ability to go to work, and answer phones or stock shelves, or do whatever it is teh job requires.
It's like the companies who have begun attaching morality clauses to their employment contracts. No go! Leave me alone, what I do with my things on my time is my business! -
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Actually, people with bankruptcies "get past" this check because it is against the law to discriminate in hiring because a person has a bankruptcy pending or on his credit report.
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@Anok,
It is not only handling money or investments. Credit reports also show if a person has a potential to be bribed. Any person who will have access to sensitive information on celebrities, Government Officials, CEOs, or access to secret military information will more than likely be screened in this way.
Also, the morality clause usually is stated in a way that says you will not bring discredit upon the firm you are working for and not just you as an individual. For example, I work for company X and I’m at a KKK meeting or some other crazy nuts meeting wearing an Company X shirt and hat. You can pretty much say I’m toast… -
If you can explain how a credit report tells someone how bribe-able a potential employee is...I will be amazed.
Where does it tell you that? Credit reports tell you your score, your credit history, and your debt to income ratio. It tells you which companies or credit is open, open ended, closed, defaulted, or pending some other action.
Thats, um, about it.
Morality clauses also extend to:
Smoking
drinking
homosexuality/homosexual marriage
premarital sex
extramarital sex
drug use (which is illegal anyway - but just sos' ya know )
and yes, membership to certain groups.
These are all massive infringements on a person's individual rights to do what they want to do, when they are not on the clock. -
@Anok,
The credit report part first… Let’s say you are being considered for a job at the Pentagon as clerical office worker. Now lets say you have a credit score of about 300 or something like that, it’s just bad. You obviously are having some credit issues and it is very possible you may need money. Regardless, you get the job…. They need Ninja typists.. ;-)
How does this work. Every person who enters and leaves the Pentagon is observed. You have an access badge you wear to enter the Pentagon. You don’t always take it off and put it in your purse on your way home when you ride the Metro. People on the Metro see your badge and someone sees your name. While on your way home you are talking to a co-worker and you mention that you are strapped and hope you get the pay raise you were talking about or you’re going to lose your house.
Now the person that saw your name knows you work in the Pentagon and you’re having some financial struggles. So with your name, they now follow you home, they now have your name, your address and your work location. Some handy work on the Internet and bang, they have some more info on you. They may even see you filed bankruptcy just last year.
Now, they begin talking to you on the train. You become causal acquaintances and as time goes by, the individual starts asking about your job. Sooner or later, they will pop the question. How much for you to get them access into the Pentagon? You say, I can’t do that, but they offer a large some of money (almost anyone can be bought) and they know you’re about to lose your home… What do you do? Will everyone do the same? If you were not hired, there would not be a potential to bribe you.
If you think this is far fetched or sounds paranoid, I assure it is not. Throughout my career in the military, there were plenty examples where this very same types of scenarios played out, with military and civilians alike. We had briefings on this type of stuff all the time.
As for the Morality clauses, there are a number of reasons for them. Do I agree with all of them, no, but the reality is they are there.
Let’s take smoking and drinking. Typically, the company pays a substantial amount of money for corporate health insurance. If the firm says they have a large pool of non-smokers, the company and the individual get a better rate. Let’s face it, if you smoke and in some cases drink, you will be sicker and cost more. The statistics are in the company’s favor, so you’re stuck.
As far as some of the other things you listed, it plays out almost the same as above. If you are in a position like I mentioned above, and engage in anyone of these activities and want to keep it a secret, how far would you go to keep that info from getting out? Maybe not National Security Secrets, but maybe you would slip a few finance statements or maybe personal information about another worker.
I don’t like anymore than you do, but companies and the Government have been burned thousands of times hiring people who had problems in their background. Is it fair, maybe not, but how do you protect yourself if you’re the company or the Government.
And finally, you may not agree, but I do think a persons personal life are indeed a reflection of their work ethics or vice a versa. If you have problems managing your personal life or lead a risky life style, you will more than likely display those traits on the job. It all has to do with values, which is another discussion for later.
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Years ago, I worked at Fair, Isaac, the company who designed the initial credit scoring tools. Your scores impact every financial area of your life, as well as some employment screenings. The higher the score, the less risk to a financial lender, landlord, employer, etc. The premise is that past behavior is the best predictor for future risk.
Here is a helpful PDF booklet explaining more about credit scores:
www.fairisaac.com/NR/rdonlyres/DA689E4A-08E8-42C7-9DD0-1D87FA6ED726/0/Under...-
What's funny about that though, is after all the brouhaha with my credit, I gave up on it. I have no use for it. I have not had any trouble getting the things we need, through means other than credit and finance industry.
That's not to say that a bad credit score hasn't messed me up in some areas - but living credit free, and not caring about credit scores, and living in a manner that allows us to function outside of the credit bureau is really a lot better. -
Not to mention we live in an age now where lending institutions can't really be as picky and choosy about who they lend to. We use the expression 'buy deep' to mean we're buying loans that in years past we'd never have considered. It's the only way to get market penetration.
Yeah, I just used that word.
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I worked for what is now JP Morgan Chase and it is hard if not difficult to steal money from a bank as an employees. Everything you do is dual controlled (takes two different signatures for any transaction) so you would need a second person to sign off on any transfers or debits from a customer’s account and as a New Accounts Representative you rarely deal with any big money (usually check deposits) and all transactions have your signature on it. Even branch managers need a second signature to make a withdrawal or a transfer from a customer’s account although it is easier for them to steal because the teller, fearing authority might not question a forged signature from the branch manager.
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I thik Anok and I should wrestle to decide who gets employment and who doesn't. That seems a far better practice. Perhaps we could create a steel cage or "Thunderdome?"
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Sweet! You are on!
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Debtors prisons have been abolished and people are no longer sent to jail because they cannot pay their consumer credit bills. So why are employers calling job applicant who have negative credit reports dishonest? When asked why a credit report is necessary in the employment screening process many employers will lie and say that it is a way of measuring a prospective employee's trustworthiness and integrity on the job, even though there is no unbiased, empirical evidence to support such claims. Moreover, the United States Equal Employment Opportunity Commission, says that the use of credit reports in employment screening has a disparate impact on minorities. See,
www.eeoc.gov/abouteeoc/meetings/5-16-07/klein.html -
That's the other thing too - businesses that have a lot to lose via less than ethical employees need to put safety measures in place regardless of who they hire. Like I said above - a credit score doesn't tell you if the person is a criminal or not.
And, what's worse is the assumption that a person with bad credit is irresponsible with their money so they MUST have a high potential for criminal acts.
The more I think about it, the more I dislike it.-
Amen! I agree with what you are saying and can anyone honestly say that they know a lot of people whom, because of bad credit they go around stealing?
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Nope, I can't say that I do. I do know there are a lot of criminals out there - and some may have bad credit, some may have good credit, but a lot of them deal drugs and are more than wealthy because of it. They aren't applying for any jobs - is what I'm saying LOL.
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One thing to keep in mind though is that not all jobs require a credit check. None of the ones I've worked in ever have. Maybe that's changing and I'm just not aware of it.
I know if I started my own business though, I'd probably side with someone with no bankruptcies over someone that has a habit of buying a $50,000 Lexus and then filing Chapter 7 every few years (which I've unfortunately seen thousands of times over). Especially if I was hiring them to balance my books.
Could they have had a legitimate reason? Of course - that's what BK protection is there for - but the situations I've reviewed in my job trend highly towarsd abuse of BK protection (i.e., "I want this but ain't nobody gonna make me pay for it" - yes, that mentality is rampant out there)rather than necessity.-
Well, if you're hiring someone to keep your books s/he should be an accountant - and how many accountants do you think are that financially irresponsible?
I mean, seriously. Sure, I think if someone has had multiple bankruptcies there might be a problem there. But you can also get the same or similar information from a simple background check. (How many times has a car been repo'ed for defaulting on a loon, or as capital for bankruptcy?). Or, sometimes just lookin' at a person. If you have a person with little to no education, and no job, driving a big expensive car......chances are, something is amiss
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I've only ever seen repo's disclosed on an actual credit report - that's how we report them (in fact, the only way we report them) - using Metro 2 coding.
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You need a credit report to work at Big Lots can you believe that? A minimum wage job and they want a report. I think it is discriminatory. My credit sucks. I can't work in a bank or Big Lots because of this. I don't steal, lie, or cheat anything. Mine is a series of bad decisions when I was younger. I was a manager at a restaurant and my safe always ended up perfect but I can't work in a bank. -
That does seem excessive for a minimum wage job. The good news is that any adverse info on your credit report should expunge in 7 years.
When I used to "buy paper"- I couldnt' even see bankruptcies and repos that were beyond that time frame.
edit: Unless one thing happens - which is scandalous in my opinion - a lot of companies (particularly related to medical bills, it seemed) will sell your "debt" to other collection companies - in which case the same debt can keep showing up for years and years on end. That's something that should be nixed, in my opinon. Not sure how though. -
I have 2 years to go. The good news is some of that is getting paid off w/ income taxes. My car repo isn't on my credit. The Bank got sued and had to wipe it off my credit. I bumped my score up.
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If it's really close, I wouldn't even apply for credit anywhere until the 2 years is up. I've heard (and don't know for sure) that even inquries can acually reduce the score slightly. I think it's somehow factored in tht the more inquiries, the more credit lines you are seeking, which makes you more risky. That might be worth looking up though - don't quote me on it.
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Also, whatever credit you apply for and get before the two years is up may - scratch that - will mean that you will endure unreasonably high interest rates and stiff penalties for the smallest infractions.
You'll still have to deal with that until you build your credit back up - but probably not as badly if you tried to do it now.
I on the other hand, have no more use for credit -
I made an inquiry this year for Habitat. You have to at least take the effort of cleaning up your credit to get a home because they are giving you a loan. My score is or was at 615 which is getting better when I got the car I had no score.
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615 is not too bad at all! After the identity theft mine plummeted to somewhere in the low 300's, seriously that's a four hundred point plus drop in a matter of a couple of months.
That's bad. -
Yikes! I hope everything got fixed.
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Nope. Fours years, two attorneys, and still nothing.
Nothing has been resolved other than the harassing phone calls have slowed to a trickle. I don't think it ever will be fixed, either.
Ergo, I no longer use credit, at all. I've closed all credit accounts, paid on what was actually mine, and refuse to open any lines of credit. I won't do it. It's waaay too much trouble! -
That really sucks.
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Yeah, on the other hand there is a silver lining. Had I not been exposed to the "other side" of the financial industry, and the capitalist industry in general, I would never have realized what is actually happening to people, and would not have progressed or grown as a person.
I'd also probably not be debt free -
See, there is a silver lining. I wish you well w/ your finances.
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That, actually, is the one instance in which you cannot discriminate--you can take someone's credit report into consideration in hiring decisions, but not hiring someone because of a bankruptcy is illegal except in very limited circumstances (ie: financial services)
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Well, it's not to discriminate against minorities, but everyone in general. I'm completely against a credit check for a job interview. Especially in this day and age when EVERYONE has bad credit and is struggling to keep their heads above water. A friend of mine had to declare bankruptcy a few years ago and now she's having trouble finding anyone to hire her even though it was the result of a divorce and bad luck and she's a skilled worker with a Masters Degree. It's just wrong and should be illegal.-
See that is my point and the EEOC’s point. Not all job candidates are disqualified because they have bad credit Company ABC might have three applicants, a Black man, white woman and a white man. They all have bad credit but everything else in their background reports is okay but only one of them can get the position. The company recruiter at Company ABC does really hang out with Black people in his personal live and he does not find the White woman attractive and although the Black man has the best academic and experience credentials he decides to hire the White man and he sends out letters of rejection based on bad credit to the Black man and the White woman. This happened in at a bank in my community a few years back where all of the teller applicants had bad credit but the minority applicants were declined based on the bad credit and the White ones were hired even though their credit was bad too.
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hmmm...were you the one doing the hiring? If not, how can you state definitively who had "bad" credit informatoin? The people reviewing the credit of applicants should not be discussing specifics with outside parties. So, either you were involved in the hiring decision, or perhaps that which you think is factual may instead be rumor.
On the flip side, realize that discrimination happens against white males as well. I've been flat out denied for jobs on the grounds that "we're looking for a minority candidate."
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I have know a lot of folks who work for banks and other financial institution who do their job very well but when it comes to their personal life their finances are a mess. One has nothing to do with the other. Would you stop going to a doctor if you found out that he or she smokes cigarettes, drinks heavily, and eats a lot of unhealthy foods in their personal life?
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It might impact how much advice I take from them, yes.
Would you go to a marriage counselor who had been through several messy divorces? Seems counter-intuitive to me - unless he had somehow learned from his mistakes.
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I have seen a lot of doctors and nurses who are over weight and smoke that look like they are in overall bad health. Should they be denied a job because of their personal health practices?
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"personal health" is a broad spectrum and can include all sorts of factors, such as genetics. Ever heard the expression apples to apples? This comparison would be more apples to oranges in my opinion.
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You know what I mean kdawg68, I have partied with doctors who smoke and not just ciggies.
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in that case, if you're talking about doctors who use drugs - yes, I'd probably seek other professional opinions.
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I would agree if we're talking about hard drugs that affect one's ability to you know, be human But as for personal choices that one makes outside the office? I don't see how that affects a doctor's ability to check, diagnose, or treat patients.
Smoking cigarettes (or drinking alcohol, or even smoking pot) doesn't impair the person's ability to recall the years of training they've had, and apply that knowledge in a reasonable and safe way at work.
It might make them a bit hypocritical if they lecture you about it, but it won't change the fact that medically speaking, they are still correct. -
Yeah, I guess in general response I'm thinking that if I "know" my doctor is all smacked up on something - I'm probably not going to seek his advice.
I think you know where I stand on the recreationals, Anok. -
Exactly
hehehehe....
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oh no! my credit is bad, maybe that's why I'm having a hard time.-
I have to say this because your avatar has a finger up the nose. Are you sure it's your credit?
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Ha!
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kdawg68, you got me rotflol! LOL
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I'm good like that - this is actually a really good discussion. I had never considered the other viewpoint on this, but you guys have me thinking now.
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@ csiunatc
A criminal background check should be enough. Most major corporations will do a criminal background check on the State level and on the federal level through the FBI and they usually go back 7 years and that should be enough. If the criminal justice system is not showing a record of past or present criminal activity HOW DARE TRW and the other two credit reporting agencies call someone a crook!-
Call someone a crook? I'm not sure what you mean by that. In my work, I've reviewed many, many credit reports and I've never seen that designation appear!
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They are not calling anyone anything. They are reporting exactly what you have or have not done.
IF something in your credit report is wrong, have it removed.-
That's a nice thought, CSI, but it's much easier said than done. Even with legal assistance (which can be very expensive), it can take several months to get erroneous information removed from your credit report, and then it often reappears after a few months.
In most cases, they are NOT "reporting exactly what you have or have not done"--here's a CBS news story from a few years ago reporting on a study that showed that approximately 80% of credit reports contained errors. More recent studies have shown that about 1/4 of credit reports contain substantial errors that could be expected to change credit or employment determinations.
Oops--just realized I forgot the link: www.cbsnews.com/stories/2004/10/12/earlyshow/contributors/raymartin/main648... -
Thank you Tiffany! I have been trying to straighten out my credit for FOUR YEARS - with lawyers (or through lawyers, I should say). It aint easy, and it aint accurate, I'll tell you that much.
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@ CSI and Madem X
The inference (means inferred) meaning is there; if you doing an all fifty state and federal criminal check on someone for the past 7 years and you don’t find anything a credit report should not come into play. Banks fingerprint you and send your finger to through the States criminal justice system and through the FBI.
P.S. Some people need to recognize metaphors in writing and stop taking things so literally. Keeps things friendly. -
I think we all got that that was your opinion, Phoenix. Where the confusion seems to keep coming in is that you're apparently under the impression that no one is allowed to over his or her OWN viewpoint, only respond to yours. We're free to expand the scope of the discussion.
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Yes... the system isn't perfect. No system is.
However, you can and should have faulty items removed. I've done it for friends and i'm no lawyer. I don't know what happens for you to get faulty items reappearing on the credit report. But once it is off, you can just refer to that decision and have it taken off again if im not mistaken.-
CSI, I'm an attorney with an extensive background in consumer protection issues and worked as a writer/editor for one of the country's leading bankruptcy attorneys in conjunction with an attorney who is nationally known for his work in predatory lending--I have literally seen this happen several hundred times, to people from all walks of life with all different financial backgrounds. I'm glad your experience has been smooth, but it's far from the norm.
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OF course i understand that, Also, with your background you are bound to see more of the bad stories than the good ones. Trust me, if you go by my professional record, there isn't a company out there that isn't in serious trouble. (which is nomally when they come to me)
What I'm saying is this.
I've been involved and in charge of hundreds of hiring / firing procedures. Many involving background and credit checks.
Not in one single case, have I seen the Credit report being the end all be all of someones application or termination.
CAN it be abused? Naturally. But the abuse itself is the problem, not the tool. It's like saying hammers are bad tools because they aren't surgically accurate and you can hurt yourself or someone else with them.
Removing a tool that can help a company to protect itself not only from irresponsible employees, but also from lawsuits on negligent Hiring practices. Is not going to do anyone any good.
A Neg. Hiring Practice lawsuit can topple a small or medium company over. And a lot of people could lose their jobs.. Tell me how that is better than breaking an egg to make the omelet?-
I'm not sure that your response makes sense in terms of what you're responding TO--I haven't taken any position on whether or not companies should or should be allowed to review credit reports...I simply said that your representations that credit reports were a record of "what you have or have not done" and that errors were easily corrected weren't nearly so accurate as we might hope.
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Frankly, I don't think that credit reports as they currently exist should be used for anything. They're haphazard, the three major bureaus often report different information, almost no report is complete and accurate, and the advent of a host of different numerical scores means that rates and even approval can vary dramatically dependent on nothing more than which credit report a creditor, prospective employer, insurance company or any of a wide range of other companies happens to request. I don't think it's "discriminatory" or any such thing; I simply think it's a radically inaccurate and highly random designation that doesn't provide useful information and does more harm than good to all parties in virtually every circumstance.
I can't think of any other area of life or business in which records with a known 80% error rate would be relied upon, let alone in which companies would pay for the privilege of accessing information they know to be wrong.
It's easy, and so the reliance continues--if it weren't available, maybe employers, creditors and everyone else would have to work a little harder, but would come up with information that actually had some meaning. -
Well said!!!
*Ahem* Sorry I'm all excited, but it's nice to have a legal professional weigh in, and actually agree with me on something
I said it at the very top, it is an unreliable way to check on a prospective employee yay! -
I don't know. I still think it has merit. It only becomes a problem if we make decisions without discussing and questioning the data.
Like i said, its how you use the tool thats the problem, not the tool itself. -
If the tool is flawed, it can never be used properly.
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I thought you had kids? Shouldn't they have gone out with the bath water?
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Huh?
What does that have to do with broken tools?
*confused* -
In this case, CSI, the system IS the bathwater...and the baby is drowning.
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Nice retort counselor, but the question still stands since that is the topic of this thread..
Which option would you prefer?-
your answer came after my question. THank you though.
With regards to "error rates" try economics.
This is the only discipline that gives out a Nobel Prize based on who was the least wrong.
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There are some good reasons to ask for a "credit report" in some positions. People who handle a lot of cash can be a risk if they have lots of debt or bad credit. -
My view on this is any company needs to look out for them selfs. If the company has someone thats not responsible with their money will they be responsible at work? I am sure there are stats on this but it must have shown they are not. I feel a company has every right if not have more rights when hiring. With how much more we pay people here in the US compared to other countries each person working for your business is a LARGE investment and will make or break the company.-
There is no correlative data to support the use of credit reports in pre-employment screening it is a totally arbitrary thing. People just don’t go out and steal because they have bad credit. The creditor will not send someone to your house to kill you if you don’t pay your credit card bills.
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Stockhola, it seems to me that you're mixing two different issues. Certainly, employers should be able to screen employees before they hire them. But a negative credit report doesn't necessarily indicate that someone is irresponsible with money. It might also mean:
-They're one of the 80% of Americans whose credit report contains errors;
-They're one of the more than 25% of Americans whose credit report contains substantial errors likely to affect a credit determination;
-They're one of the millions of Americans whose credit has suffered due to unexpected job loss, serious illness, or divorce;
-They've tried too hard to be responsible and done themselves substantial harm in the process...for instance, using high-interest credit cards to make payment on uninsured medical expenses they'd have been better off (from a credit score and long-term expense perspective) ignoring.
This list could go on almost indefinitely. -
Phoenix, what is the relevance of "the creditor won't send someone to your house to kill you..."?
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@ Madame X
There are no motivating factors to steal, as would be the case if a person had defaulted on a loan with an unscrupulous loan shark. If the default was on a loan from a loan shark the borrower might be motivated to steal in order t ensure his or her safety. -
This has nothing to do with minorities, it's just another way for jobs to not employ the perfect person. I don't believe the "perfect person" should be based on your credit. Mistakes that may have been made years ago that are still on your report has nothing to do with whether or not you are a good employee. People who have financial hardships slack sometimes on paymentsand their history gets all screwed up. So they finally get a job interview and this place requests a credit history, sees its horrible and you don't get the job. It's a catch-22. Here you are trying to get your money right, but you can't because more and more places now are using this information.
Yes you have the right to deny them that, but you will not be getting hired. It's like refusing a breathalizer when pulled over for suspision of drunk driving. You are guilty, guilty of what..not having money to pay your bills?? I don't know but I think it is wrong. In my state (NJ) it's not just banks and financial institutions, it's so many places that have nothing to do with money. Banks I can understand sort of, I guess because maybe they believe you have poor credit you would steal from them. Its crazy, what moron would steal from a bank, and who is to say that if you have bad credit you would steal?
This topic gets me so fired up.-
It gets me fired up too and the only way we can chage things is by talking about it and contacting our public officials who can enact laws to stop the use of credit reports in emploment screening.
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