Bad Credit No Longer a Problem in Job Hunts

Your credit history can keep you from getting a job.

For years employers have been pulling credit reports as part of the background check of potential job applicants.

“In the past only bank and financial institutions used credit checks,” said Amber Yoo with Privacy Rights Clearinghouse, “But over the years it has evolved so that more and more employers are using it to predict character judgments on people.”

Phil Blair with Manpower San Diego says a bad report could ruin a person’s chances of getting hired.

“You get one credit report back and it is a really negative one and you have two or three candidates to pick from, your tendency is not to pick the one with the negative credit check,” said Blair.

But while Blair understands why employers would look into a candidates financial history, he says it isn’t always fair.

“It is not indicative of the person’s ability or trustworthiness to do the job,” said Blair.

The credit report can include financial problems stemming from divorce, foreclosure, medical emergencies and more.

Starting in 2012 California employers will no longer be able to use those credit reports to judge a candidate. “It prohibits most employers from running credit checks on applicants unless it is substantially related to their job,” said Amber Yoo.

According to the new labor code employers can only use a consumer credit report if the person is applying for jobs like:

- A managerial position – A position in the state Department of Justice – A sworn peace officer or law enforcement position – A position where the person regularly accesses certain confidential information including bank or credit card accounts and social security numbers

California joins Connecticut, Illinois, Hawaii, Oregon, Maryland and Washington that have similar laws.

Amber Yoo says this change is the right thing in these tough times.

“Credit history does not predict job performance and so it is really unfair,” said Yoo.