House Approves Ban on Most Employment Credit Checks

Some people think that credit checks on potential employees are an arcane, irrelevant measure. What does someone’s credit history have to do with their capability in a job role?

Others say, “A lot!” Credit reporting is indicative of a candidate’s judgment and potential risk, especially if the job in question is a financial role.

Regardless of your point of view, the US House of Reps passed a law in January that prohibits employers from conducting credit reports as part of the hiring process, except for a few notable exceptions. So if you’ve always relied on credit reporting as a marker of candidate worthiness, you’ll have to recalibrate your hiring efforts.

But if you’re mourning the loss of credit scoring as a mechanism for hiring decisions, take heart in the words of Chi Chi Wu, staff attorney at the National Consumer Law Center based in Boston: "The overwhelming weight of evidence is that people with impaired credit histories are NOT more likely to be bad employees or to steal from their employers.”

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