Use of Credit Reports in Employment Screening has been a controversial subject, according to a recent article in Forbes. In the current economy, a lot of otherwise well qualified people may be having problems getting jobs because of a poor credit history through no fault of their own. People who have been out of work for a while may find themselves relying on credit cards for daily expenses and, on occasion, have not been able to pay the balances. A medical crisis can also hit someone’s credit rating.
Most employers who use a prospective employee’s credit history as part of their screening process do so if the job being filled has some kind of financial responsibility. People with bad debts may be more susceptible to embezzlement or some other crime that would be detrimental to the company.
A white paper published by Employment Screening Resources notes that companies that do a credit check on a prospective employee do so after they have passed other criteria, such as job experience. These kinds of credit checks can only be done under certain circumstances and with the job applicant’s consent.
The advice given to job applicants who have a spotty credit history is to be proactive in discussing with human resources of a company about the reasons why the financial reversals happened and what they intend to do to address them. This may be a good piece of advice for HR managers as well. Very often people get into credit problems for no fault of their own and the act of searching for a job is part of their process to getting out of them. That could be construed as a sign of responsibility. It is certainly a consideration when making hiring decisions.
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