Employment

[Anonymous]

I have often read that employers perform credit checks when making hiring or promotion decisions. Does anyone have any "inside" knowledge about this?

[mitchblue]

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@Anonymous wrote:
I have often read that employers perform credit checks when making hiring or promotion decisions. Does anyone have any "inside" knowledge about this?

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It happens. I had it on a couple jobs earlier on my life. Drug test too, cut some of my hair.

[Anonymous]

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@Anonymous wrote:
I have often read that employers perform credit checks when making hiring or promotion decisions. Does anyone have any "inside" knowledge about this?

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Probably best that you research the specific employer(s) in question and you'll probably be able to find info if they do indeed do credit checks.

[Thomas_Thumb]

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@Anonymous wrote:
I have often read that employers perform credit checks when making hiring or promotion decisions. Does anyone have any "inside" knowledge about this?

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Yes, it's not uncommon particularly if the position involves P&L responsibilities or awarding of sizeable contracts to vendors.

One company did a rather exhaustive background check on me after I accepted their conditional offer. The check included a deep dive into my financial stability in addition to the typical criminal background check. I know this because the state I worked in mandates an employer must provide the employee with a copy of the background report upon request. I was a bit taken aback by the amount of information in the report - and it included a good deal of financial data not on CRA reports.

[Anonymous]

TT, would you care to expand on some of the financial information that was available to them from the background check that isn't present on your credit reports?

[RobertEG]

An employer may not solicit a credit report from a CRA for employment purposes without first providing notice to and consent from the consumer.

FCRA 604(b).

Thus, they cannot do so without your prior knowledge.

[Anonymous]

Robert, what sort of recourse would you have against that potential employer should they pull a credit report without your consent?

I feel like that's a tight rope to walk, as if you're seeking employment from someone the last thing you probably want to do is blow the whistle on them for potentially violating this policy.

[Thomas_Thumb]

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@RobertEG wrote:

An employer may not solicit a credit report from a CRA for employment purposes without first providing notice to and consent from the consumer.

FCRA 604(b).

Thus, they cannot do so without your prior knowledge.

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True: however, this is rather a moot point. A potential employer can:

1) Require a drug test as a condition of employment.

2) Require authorization for a criminal background check as a condition of employment

3) Require authorization for a credit/financial background check as a condition of employment

No authorization no job. If you like the offer and want the job authorize the check. No surprise on my part that a check was done - it was authorized. The surprise was how much info was in the report. List of employers over the past 25 years along with ending salaries for each employer. The salaries were rather inacurate in some cases but, if when you get the job why would you dispute such trivialities. The check also included a mortgage that had been paid and closed 12 years prior to the report and a record of unemployment benefits from a RIF. The report included information on Auto and Home insurance and a summary of all claims as well. [A denied property damage claim submitted for: damage - wood rot from water associated with inproper flashing - showed on the report. Repairs cost me $4k out of pocket]

The background check I got a copy of was from 9 years ago and included quite a bit of other information but, I don't recall the details. Not sure if I can find the report.

These days you can obtain insurance policies, claims and driving citation information through LexisNexis free of charge. The LN full disclosure report also has info on much, much more. You can obtain salary history information through Experian's "The Work Number". Also, "The Retail Equation" maintains a file on your merchandise returns history -which you may be able to get a copy of as well. 

I would recommend getting the above reports. They contain a lot of info not on CRA reports.

[RobertEG]

I dont disagree.

However, the consumer should be aware that the employer cannot simply make an inquiry without their express knowledge and approval.

The consumer could thus choose to continue the process without fear that their application will per se authorize an inquiry..

[Anonymous]

Good morning, everyone, and thank you all for your replies. I should have been more specific in my question. I realize that potential employers can, with permission, access a candidate's credit history. This is typically authorized by the candidate during the application process so while it would not surprise me if unauthorized credit pulls have taken place, I imagine that most legitimate companies "stay within the lines." I really meant to ask just how big a decision credit plays in general (I realize that each employer may weight candidates' credit differently), and if anyone knows the extent to which employers use credit information when making promotion decisions. I apologize for the vagueness of my original post.