After the financial crisis of 2008, many people (myself included) had their credit ratings destroyed. Credit card debt, foreclosures, bankruptcy and financial problems have put some Americans into a hole they are having a hard time digging out of – especially when it comes finding a job. While the current unemployment rate continues to decline, qualified applicants have been turned down for jobs based solely on their credit rating.
In 2010, after resigning from Sprint/Nextel, I was turned down for a better position with Spherion that I was more than qualified for, simply because of my credit. According to the Society For Human Resource Management, nearly half of organizations have credit checks as part of the employment screening process. While credit history is something that is important when it comes making a hiring decision for people who may handle large amounts of cash on a daily basis – such as an armored car driver – it really is unfair to deny a job to someone who won’t be a serious risk to a company’s finances just because they may have an unpaid credit card bill or past due student loan debt.
“Jobs associated with maintenance work, telephone tech support, assisting in an office, working as a delivery driver, selling insurance, laboring as a home care aide, supervising a stockroom and serving frozen yogurt are subject to credit checks. Some employers even conduct credit checks on existing employees when they are considering a promotion, according to Amy Traub, senior policy analyst with research and policy center, Demos.”
Thankfully we have sensible people like Senator Elizabeth Warren, who understand how this ends up being unnecessarily discriminatory and affects otherwise qualified people in an extremely negative way:
“Warren’s argument is that poor credit is often discriminatory and affects minorities more than other groups. The reasons for bad credit are often tied to medical bills and unemployment, and further impacted by economic downturns–not an individual’s character or ability.”
In filing this bill (which has been killed in previous sessions of Congress), Senator Warren stated the following on her blog:
“Most people recognize that bad credit means they will have trouble borrowing money or they will pay more to borrow. But many don’t realize that a damaged credit rating can also block access to a job.
It was once thought that credit history would provide insight into someone’s character, and many companies routinely require credit reports from job applicants. But research has shown that an individual’s credit rating has little or no correlation with his ability to succeed at work. A bad credit rating is far more often the result of unexpected personal crisis or economic downturn than a reflection of someone’s abilities.”
Yes, the economy is getting better and unemployment rates are slowly dropping, but unnecessary credit checks on prospective employees aren’t helping and are keeping qualified applicants from exiting the unemployment rolls. Some states like Vermont already have legislation like this in place, but this bill would make discrimination based on credit history illegal nationwide. Please sign on and show your support for the Equal Employment for All Act.
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