Credit Checks For Job Applicants May Be Illegal

According to a survey of human resource folks, 60% of them say they are now running credit checks on potential hires. But there’s a new movement in several states — and one bill stuck in Congress — to make it illegal for a company to run such checks, because detractors claim they are hurting people from getting jobs during the recession.

“We are in the great recession and this creates a vicious cycle,” Maryland Delegate Kirill Reznik explains. “People lose their jobs, that naturally precipitates them getting behind on bills, their credit scores go down, they are trying to find a job to pay off the bills, and employers won’t hire them because of their credit score.”

Maryland is just one of 16 states, including Illinois, Wisconsin, South Carolina and Oregon, to be mulling over the ban on job applicant credit checks. Hawaii and Washington already have such legislation in place.

“If somebody is trying to get a job as a truck driver or a trainer in a gym, what does your credit history have to do with your ability to do that job?” Wisconsin state assemblyman Kim Hixson said.

Congressman Steve Cohen of Tennessee has introduced a bill that would impose a federal ban, but that is still stuck in committee somewhere.

The California state assembly handed Gov. Schwarzegger a bill that would rein in these credit checks, but he terminated it with his laser-scoped veto power.

Should credit checks be done on potential hires? Or should they only be allowed for certain types of jobs?

States may ban credit checks on job applicants [Chicago Breaking News]