Black folks, Credit Checks & Jobs: States considering banning credit checks on job applicants

Lemme get right on in and say that this is something I fully support. And no, I’m not saying this because I myself posses less than impeccable credit. I’ve always been of the opinion that it was some unnecessary tool used against people seeking employment. I mean, the only thing that should matter is a criminal background check; because, well, nobody likes the idea of sitting next to a serial rapist or child molester at work for eight hours a day. To me, that’s more pertinent information to be considered when screening job applicants. Whether they are currently forced to put their utilities in the name of their kids or how many bankruptcies they’ve filed are of no consequence. I have some more to say on this but checkout this press release and tell me what you think:
ANNAPOLIS, Md. – It’s hard enough to find a job in this economy, and now some people are facing another hurdle: Potential employers are holding their credit histories against them.

Sixty percent of employers recently surveyed by the Society for Human Resources Management said they run credit checks on at least some job applicants, compared with 42 percent in a somewhat similar survey in 2006.

Employers say such checks give them valuable information about an applicant’s honesty and sense of responsibility. But lawmakers in at least 16 states from South Carolina to Oregon have proposed outlawing most credit checks, saying the practice traps people in debt because their past financial problems prevent them from finding work.

Wisconsin state Rep. Kim Hixson drafted a bill in his state shortly after hearing from Terry Becker, an auto mechanic who struggled to find work.

Becker said it all started with medical bills that piled up when his now 10-year-old son began having seizures as a toddler. In the first year alone, Becker ran up $25,000 in medical debt.

Over 4 1/2 months, he was turned down for at least eight positions for which he had authorized the employer to conduct a credit check, Becker said. He said one potential employer told him, “If your credit is bad, then you’ll steal from me.”

“I was in a deep depression. I had lost a business, I was behind on my bills and I was unable to get a job,” he said.

Hixson calls what happened to Becker discrimination based on credit history and said his bill would ban it.

“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?” Hixson said. He said he knows of no research that shows a person with a bad credit history is going to perform poorly.

Under federal law, prospective employers must get written permission from applicants to run a credit check on them. But consumer advocates say most job applicants do not feel they are in a position to say no.

Most of the bills being proposed this year resemble laws in Hawaii and Washington that prevent employers from using credit reports when hiring for most positions. The laws contain exceptions in cases where such information could be relevant to the job — for example, if the person is applying to work in a bank or an accounts-payable office. (Read More: Yahoo News)The article goes on to show how opponents of this measure suggest that there is a direct correlation between people with bad credit and workplace fraud. Which is bullshit because there really isn’t any empirical evidence to support this claim; and the practice is as egregiously discriminatory as is the assumption that black people, generally posses poor credit scores. I can tell you as someone with a background in marketing and sales, that on more than one occasion, at different companies, I was reminded to “stay away” from black consumers because of said assumption.

That said, I can’t help but to think of just how this is used as a tool to further discriminate against people of color on the sly when it comes to employment- people who are already behind the eight ball as the income gap continues to widen. But I guess it’s important to be sure to hire people who are less apt to steal food from the office refrigerator.
Even though more companies are using credit checks, only 13 percent perform them on all potential hires, according to the Society for Human Resources Management’s most recent survey. Mike Aitken, the group’s director of government affairs, said a blanket ban could remove a tool employers can use to help them make good hiring decisions.

Aitken pointed to a 2008 survey by the Association of Certified Fraud Examiners that found the two most common red flags for employees who commit workplace fraud are living beyond their means and having difficulty meeting financial obligations. The same survey estimated American companies lost $994 billion to workplace fraud in 2008.

Aitken said someone who cannot pay his or her bills on time may not be more likely to steal, but might not have the maturity or sense of responsibility to handle a job like processing payroll checks.With Blacks and Latinos disproportionately affected by the economic fallout – especially the ones targeted by sheisty predatory lenders – it’s sad that along with worrying about their applications being pushed to the bottom of the pile just on the strength of having an “ethnic sounding” name. They now have to contend with having to navigate the job market at a disadvantage because of their credit score. The gentleman highlighted in the story above – Terry Becker – is white man and even he had a hard time finding employment. That said, I don’t have to tell you just how this practice moving forward as the economy recovers would affect people of color.