Jobseekers worried that bad credit scores may show up during pre-employment background checks and hurt their chances of finding work may not have to worry much longer.
A new bill introduced in the House of Representatives – The ‘Equal Employment for All Act’ (H.R. 3149) – would amend the Fair Credit Reporting Act (FCRA) to prohibit the use of consumer credit checks against prospective and current employees during hiring or firing processes, thus preventing employers from using credit reports as part of pre-employment background checks.
According to a press release from the offices of U.S. Congressman Luis V. Gutierrez (D-IL), the act would give “credit-challenged” citizens – such as students, recent college graduates, low-income families, senior citizens, and minorities – the opportunity to begin rebuilding their credit history by obtaining a job. Many jobseekers are turned down after background checks due to poor credit because employers “have erroneously linked credit scores to potential job performance.”
H.R. 3149 specifically states that “a person, including a prospective employer or current employer, may not use a consumer report or investigative consumer report, or cause a consumer report or investigative consumer report to be procured, with respect to any consumer where any information contained in the report bears on the consumer's creditworthiness, credit standing, or credit capacity.”
This prohibition applies even if the jobseeker consents to or otherwise authorizes the use of a background check for employment purposes. However, there are exceptions, and employers may use credit reports during background checks in the following situations:
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When a person applies for, or currently holds, employment that requires national security or FDIC clearance.
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When a person applies for, or currently holds, employment with a State or local government agency which requires such a report.
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When a person applies for, or currently holds, a supervisory, managerial, professional, or executive position at a financial institution.
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When otherwise required by law.
However, the exceptions would have no effect upon the other requirements in regards to disclosure and notification to a jobseeker when using a credit report for pre-employment background checks or for making an adverse action – such as rescinding an offer of employment – against the jobseeker.
Even though credit reports may be excluded from background checks due to the ‘Equal Employment for All Act,’ jobseekers are still advised to keep their personal information current, accurate, and secure. An error or inaccuracy found on a background check – such as a arrest or conviction put on one's criminal record because of an honest mitake or due to identity theft – can still cost a jobseeker employment.
While most background check companies focus on employers, MyBackgroundCheck.com is a leading provider of consumer requested and applicant supplied “personal” background checks. By ordering self background checks, jobseekers can take control of their personal information and share the data with whomever they wish, including potential employers.
To learn more about how personal background checks can help jobseekers, visit www.mybackgroundcheck.com, email info@mybackgroundcheck.com, or call 1-800-503-2364. To follow MyBackgroundCheck.com on Twitter, visit www.twitter.com/MybackgroundChk.
tahearn@mybackgroundcheck.com