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SmartCredit.com President of Consumer Education John Ulzheimer on employers use of credit reports as part of their employment screening process.
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A recent survey found 60% of employers check applicant's credit reports as part of the job hiring process.
Which leads to the question should employers look at these reports to hire employees.
Here to break it down John Alzheimer is the president.
-- patients mark credit dot com.
-- a lot of -- confusion out there us.
To employers look at credit reports and they look at scorers what's legal what's not legal.
It this Jerry is by far the most -- reported topic.
As it comes as it pertains subtle world of consumer credit reporting credit -- Credit reports and credit scores unfortunately in the world and employment screening have become one in the same and people are using the terms interchangeably and that -- incur acts.
Both at the federal -- the fair credit reporting act allows employers to look at credit reports.
As part of pre employment yen's continued employment screening however.
Credit scorers -- charges -- numeric representation of the credit report data.
Are not have never -- and are not even contemplated being used by employers it is absolutely.
-- Nat -- There are some states.
That had meant it had ever written legislation that restrict the use of credit reports -- only certain types of positions.
Meaning positions where -- -- -- law enforcement you have access to sensitive information large amounts of money or sensitive data like for -- summoning human resources.
Are my reaction to this.
Is I would almost rather the employer to see my score -- my report because my report contains so much personal information.
Hey here's the downside to that any luck you're not -- -- a lot of people -- are back.
Banging that -- and saying look it's easier to look at a number than it is a five page report -- lettuce seed and number.
Credit scorers were never designed and let's talk -- that specifically because that's still the dominant score.
Fight -- scores were never designed.
For employee EU risk prediction they were completely designed and still are.
To predict the likelihood that you defaulting -- -- light on a credit obligation and are not necessarily the same thing.
There is no such thing as an employee.
Quality score it's based on -- -- on.
And yeah.
Many financial.
I don't have to do that on their -- -- absolutely I mean they have to come up with their own analysis but I think that you like in the financial industry.
I think that you know it makes cents -- people would want to see the report when they're hiring somebody who's gonna have their hand in the till.
I'll not I don't get me wrong I am absolutely.
In favor of allowing employers.
To look at credit reports -- part of their employment screening processes.
The EST just cannot overrule an earlier this week about at that or restrict criminal background checks now replenishment were along the wrong correctness is a slippery slope.
To restrict the amount of information that an employer come what gamble or higher and I mean if you represented a company you expose the company to legal risk.
-- -- -- People should be able to know who their hiring and and when they're putting -- -- to the company on that person may deserve to be able now more than just what's written on the -- Mac.
And and they have all the ways to do that that report is just one of them but.
How people get so confused about these issues I mean it seems -- so much misinformation out of -- out there wears a common ground.
You know why this -- it is generated by unfortunately.
The pretend to credit expert who have a lot of television time.
And they keep using things like credit reports and credit scores that that -- -- -- -- there are countless articles and I've been trying to kill that's math.
For as many years is like remember.
The credit reporting agencies Equifax Experian and Trans Union Mighty -- all -- home.
Have all gone on record time and time again officially and have said we do not -- -- -- Pall over the reports that we self employment screening.
The CIA which is the consumer data industry association the trade association of a credit reporting agencies.
-- also gone on record sad -- -- -- does not have.
-- -- -- Where are pretty deep in the weeds here.
Tell me what -- guilty going up to look for a job is there anything you should do to protect your personal information I mean -- look I know you wanna share a lot.
With the potential employer particularly in this down market but are their limits in your -- For the lot of -- and.
Sure but what is the basket mean cops here let people test for Iraq.
You're you're giving permission to talk to previous employers -- giving information to -- to verify where he went to college.
And having your credit report what that is not the most invasive part of looking for a job -- -- I have great credit I was growing at an -- -- saying.
This differentiates me from all those other people trying to get the same job hire me hire me hire me I have great credit.
It it if you -- worried about what's on your credit report player credit reports well in advance of a poll of applying for a job in that way at least you're gonna be able to see what the employer sees in your gonna be able to proactively -- a whip them.
Not re actively after you get a letter that says thank -- -- -- moving on to another can't.
It is amazing to me all the information these people -- and I feel sorry for those folks out there who have a bad credit score.
Because or something bad on -- credit report.
Because isn't this has been just so it's such a horrible economy look -- John thanks for coming in tonight we really appreciate your time is always great to have you want to show.
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