Credit Reports Being Used in Job Hiring
19 July 2006This came to a shock to me, but it’s really pretty predictable: many employers have started using credit reports as a basis for whether or not they’re going to hire you.
http://money.cnn.com/2006/07/19/pf/employee_screening/index.htm
A recent survey by staffing firm Spherion found that 79 percent of companies said they conduct background checks on some or all job candidates, 50 percent perform drug tests and 33 percent said they perform credit checks.
More than half of companies that use these screening methods also said they have increased their use of them since 2001.
Besides verifying the details on your resume, employers most commonly screen for criminal behavior, drug abuse, regulatory violations and — of late — inclusion on terrorist watch lists.
But they also may take an interest in tax liens, bankruptcy filings, a habit of bouncing checks, ongoing divorce and custody proceedings, driving violations and medical conditions.
That’s because employers are concerned that someone with serious monetary problems, health issues or family concerns might not be fully focused, said Tal Moise, CEO of background screening firm Verified Person, and Cynthia Shapiro, a former human resource executive and author of “Corporate Confidential.”
A full third of employers - a great reason to begin improving your credit if you haven’t already. But it’s also a little scary, in that it makes the spiral of debt problems even worse. If you can’t get a job because you have bad credit, how are you supposed to ever improve your credit?
There’s not much you can do about it, because negative information stays in your files for seven years. But you should be thinking about how you’re going to deal with it in the interview process. One suggestion the article makes is to apply to small companies instead of big ones - they are less likely to conduct this kind of rigorous background check and more likely to be flexible about it even if they find something bad in your financial past.
Another suggestion is to avoid talking about it in interviews, because the company can’t legally bring it up.
If you’re currently employed somewhere, you should start checking out your credit reports before you begin job hunting. If you spend six months to a year working at it, in many cases you can achieve a lot as far as credit score improvement.
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