Proposed changes to credit checks as part of an employee background check may change the way employers make hiring decisions.
Credit checks have long been part of a comprehensive background check, primarily as a way to determine if a potential hire is responsible with money and making financial decisions. The assumption is that if a candidate’s credit report indicates financial distress, the candidate may be more likely to make poor decisions regarding anything from simply supply purchases to major financial investments. Some employers also extend the financial distress as an indicator that a candidate may become likely to steal from the company or from clients if the situation worsens.
Because an increasing number of individuals are experience poor credit due to another person’s actions (identity theft, divorce, fraud), legislation is pending that may remove an employer’s ability to access credit information and history.
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