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Can an Employer Check a Job Applicant’s Credit Score?

When a candidate is being considered for a job, most employers conduct a background check as one tool to assess whether or not the applicant is suitable for the position. In some cases, particularly jobs that involve access to company funds or to clients’ assets, the employer may conduct a credit check. Some employers believe that by identifying candidates with poor credit or a lot of debt, they can avoid hiring people who may be tempted to steal funds or to act dishonestly.

What an Employer Can and Cannot See on an Applicant’s Credit Report

Many job applicants with less-than-perfect credit get stressed out about the idea of an employer checking their credit. They worry that a bad credit score could prevent them from getting the job they want. However, an employer cannot see a job applicant’s credit score.

What employers can see when they conduct a credit check is a modified version of a credit report that is created specifically for employers. It does not include all of the information that lenders see when a person applies for a line of credit. The biggest difference is that the credit report employers see lacks a credit score.

Job Applicants’ Rights

The Fair Credit Reporting Act places limits on who can access an individual’s credit report and for what purposes. It places some restrictions on employers who use credit reports as part of the hiring process.

An employer needs to obtain an applicant’s consent before accessing a credit report. If an employer decides not to hire an applicant because of information contained in the credit report, the employer must provide the applicant with a copy of the report before taking adverse action so the applicant can address any errors.

Some states have also passed laws limiting the use of credit checks in hiring decisions. Many employers have decided not to use credit checks in the hiring process because they understand that the recession and periods of unemployment have affected the credit of many responsible people who could be good employees in spite of financial hardships.

How to Conduct Pre-Employment Background Checks

DataCheck is a leader in the field of pre-employment background checks that has helped employers in many industries choose the right candidates. Obtaining a credit report can be one important piece of information that can help employers make the right hiring decisions. If your company needs help conducting background checks, contact DataCheck today.

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" Do not hesitate to work with DataCheck. It is a wonderful company that delivers better and faster results than our previous provider, a very large, well known background screening company, who we left after many years! JFSA began working with DataCheck about a year ago and we never looked back. The website to place orders is very user friendly and the results arrive within 24 hours in most cases. In addition, DataCheck has excellent customer service and personal touch. They are always available to answer questions as needed. We are located on the east coast and DataCheck is on the west coast, and I was somewhat concerned in the beginning about being in a different time zone, but the time difference has never presented a problem to us. DataCheck met and exceeded all our expectations!"

Tanya Borshov, Manager of Talent Acquisition and Retention
JFSA

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