I was really surprised one day when my wife was searching for a job and a potential employer required a credit check before hiring. In the most basic sense this is logical for a business. If a potential employee shows up as having bad credit then in the eyes of the business they might be more likely to be desperate and could be a liability. The new employee might be more likely to steal or be generally more stressed, and not as friendly with customers.
Pushing all the business logic aside for the moment, let’s ask what this kind of policy is doing. Well, for one, the policy is preventing individuals from getting jobs who need it most. I firmly believe the American Dream needs to be facilitated by smart legislation, which helps Americans progress from the bottom of society to their dreams. This kind of business policy goes directly against the American Dream, putting the privileged or lucky on better footing than other Americans. I don’t believe every individual who has great credit is inherently lucky or privileged, but by making it impossible to acquire a job when you don’t have great credit, does put an unfair disadvantage on people who are financially strapped.
It’s an irony that when you’re in the deepest financial straits you cannot get a job to get out of those straits, because you are in the straits in the first place, and furthermore you cannot get said job, which would save you, unless you are out of financial straits, but you can’t get said job until you are out of said financial straits. You get the point. Now if you’re one of those people who say “tough luck, they got themselves in that situation let them rot there,” than you simply don’t believe in the American Dream. With this mentality, you don’t believe this country, above any other, provides individuals the greatest opportunity to succeed in life not matter where you come from or who you are.
As you probably gathered, I believe this practice should be illegal. I’m not a fan of regulation, but I do believe in smart regulation. For instance, who’s to say that individuals who desperately need a paycheck wouldn’t be incredible loyal, more so than the individual who doesn’t need the money. Furthermore, by preventing these people from getting a job in the first place you are removing from your talent pool potential employees, possibly destroying the future and success of your company.
Some states have made this practice illegal. I think it is time for the federal government to step in and make sure all Americans are safe from this discriminatory and anti-American Dream policy. Problem, companies are rejecting applications for employment based on credit scores. Solution, make the practice illegal.
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Judah — this is a very good insight! I think that one reason people are required to have credit checks is to see if they are responsible. Credit scores can be seen as a stewardship gauge of how “good you are at life” and thus whether or not the person would actually be able to handle the various duties that they’ll be given on the job. What do you think about that? I do agree: the hard-nosed “get what you deserve” folks won’t stand behind this one, but I know they definitely wouldn’t prefer the alternative: getting on welfare, or…crime.
Using credit checks to gauge how “good people are at life” is already implemented in providing additional lines of credit. In this, it is essential to make sure these individuals do not continually make bad choices to their financial detriment.
That aside, I’m not sure how using credit checks to reject employment will prevent individuals from making choices to their financial detriment. Rather it would most likely do the opposite in denying them a source of legitimate income.
In regards to employment, it might be a gauge for how desperate a person might be, but that can be view in two ways. Either the person might be a liability for theft or they are more likely to respect the job, because their financial need is so great.
Ultimately, credit check to reject potential applicants serves the cycle of poverty and crushes the American Dream with little to no benefit to the employer. The practice must stop.
Hmmm, lets see here. A person with bad credit cant have a job because they have bad credit and that in turn means that THEY would be the MOST motivated to commit crimes, and perhaps even be a party such things as corporate espionage. So says the argument anyway….
I don’t see anybody questioning the activities of corporate execs at the very top of the financial food chain. These people have impeccable credit, many bring home in excess of 7 digit salaries plus bonuses, yet time and time again, they seem to be the ones who commit the crimes. Not just business crimes mind you. These characters are the constant stars of such dramas as: sexual harassment, the missing spouse, the wrecked car, the burned house, the abused child, etc.
How often do we hear about Bob the janitor, who works two jobs, has a kid in college, a huge mortgage, two financed vehicular and overextended questionable credit being involved in that kind of stuff?
What if the corporate execs at the very top of Bob’s financial food chain made some bad decisions that caused Bob to become unemployed, and in this happening, his credit were to go from questionable to bad? Now Bob, who has always tended to his credit obligations, has a bad credit report. And because his report is bad, he can’t get a job.
A person’s moral fiber cannot be judged by their credit standing. Credit-ability and employ-ability are mutually exclusive and should remain that way!
I completely agree and that is why I believe it should be illegal to disqualify a candidate from even being considered for a job based on their credit alone. Thank you for the comment.