While hiring the wrong person is always a mistake, it can potentially be a serious crisis in cases where an employee’s role includes managing company funds or accessing sensitive financial data. For these important positions, incorporating a credit report into the hiring or promotion process is something that just makes sense. While the credit report that employers have access to is limited, it provides insight into the candidate’s financial health.
Asses If the Employee Is Responsible With Money
How an employee handles their own finances can reveal important aspects of their character, especially how responsible they are. Information such as payment history and the standing of financial accounts will reflect the candidate’s habits, skills, and values when it comes to financial management. Missed payments or bankruptcy could be a red flag for how that person will perform their duties. For an employee that’s managing the department’s budget, or having other responsibilities with company funds, it’s very relevant to assess if they can manage money responsibly.
Exposing Potential Risk Factors in Financial History
An employee that’s in a significant amount of debt might be more tempted to engage in unethical behavior. The whole point of risk assessment is to make smart decisions based on available information. If these potential risk factors never come to your attention, it’s not possible to make an informed decision. A credit report is a sensible tool for identifying if a candidate might be more likely to commit fraud or theft.
Protect the Integrity of the Company
Utilizing a credit report is of vital importance for an employee that is handling sensitive financial data or company funds. Hiring the wrong person, without properly assessing their background for past financial mismanagement, would make the company negligent and even potentially liable. A credit report mitigates the potential risks of an employee that is irresponsible or under financial strain. Your company’s integrity remains intact when you can demonstrate taking reasonable steps to avoid unethical financial behavior.
Learn More About Credit Reports in Employment Screening
At TruDiligence, we have 20 years of experience providing credit reports to help your business make informed decisions. Contact us to see how we can help!