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Sorry, but your single hypothetical question does not render everyone else's input moot. Perhaps no one is answering it because there's no relevance to it?
I could just as easily suggest the employer discern between two qualified candidates based on what kind of car they drive. That's as relevant to the process as credit is, in most cases. There are some exceptions, such as the prior poster who was a bank exec, for example.
My employer, consistently rated as one of the most ethical companies in America and a Fortune 100, does not use credit checks in the employment process, and yet we are large, ethical, and profitable. Imagine that.
There's absolutely a relevance to my question. A trend on this forum is to ignore logic you can't argue against when making your point, no matter how rational someone else's counter may be. That's why most have ignored my question. There simply no logical and legal counter to it besides opinions. Especially since the original question was this:
Why is it necessary for many employers to research job seekers' credit history? What does having a poor or fair credit rating actually reveal about an individual's ability to do the job? Why isn't it formally considered discrimination against the poor to determine employment based on assets and debts? Surely without a job, people can't afford to keep an ideal credit rating, correct?
The first question had nothing to do with ethics. Especially the first question. The answer to that can be simply because its legal to do a credit check so therefore if a company feels that a credit score would help them determine a qualified candidate; they are free to make that a requirement.
The second question is subject to an individuals opinion. So again if that particular companies opinion is that a credit check will help them distinguish a better qualified candidate, they can run a credit check.
The third question is purely based on a persons personal financial situation and can't really be answered with one answer. But as a purely logical answer my point still stands.
Quote:
Originally Posted by tolovefromANFIELD
Your question was asked on the 5th page of this thread: post#42
Answered: post#44
No it wasn't. That post was referring to the fact that there would never be two identical people applying for the same job (I.e. twins) with bad and good credit. My question was regarding something completely different. I will put my question in another way: Who are you to tell a privately owned company HOW they should hire as long as what they are doing is legal? If they feel a credit check will tell them who may be a better candidate they can do that. It might not be fair but too bad. Life isn't about fairness.
Quote:
Originally Posted by johnp292
The question isn't if a company can't do credit checks. The question is, are they relevant.
The answer, with some arguable, limited exceptions based on the type of position, is "no".
But since you asked, I can give you a really good reason why a company can't do it in at least 10 states....because it's against the law.
No the question was WHY do they do credit checks. My answer was because they are legally allowed. Your second point about credit checks being illegal is the only point anyone has made that actually had some ground regarding not checking someone credit. But that logic is also shaky at best.
Your point regarding it being illegal in 10 states is the equivalent of someone in CA or NY arguing against certain firearm needing to be banned in other states because they are banned in CA and NY. Because everyone knows that the lawmakers in those two states and the most fair and objective lawmakers in all of America. But there's two sides to both arguments regarding pro and anti gun laws. Unfortunately, the pro-gun states vastly outnumber the anti gun states so as of now most people are allowed to get their hands on those firearms that are banned in CA and NY.
So I'm not saying credit checks are FAIR, in terms of being a requirement for a job. What I'm saying is if a company DECIDES that they think its a fair category to judge a persons job worthiness; then most states will legally fully allow them to do so. Just like most states allow certain firearms to be bought. Can that change in the future? Sure but as of right now; the reality is there is no real LEGAL argument that can be made against credit checks in most states.
My employer has gotten a new contract with the Fed Agency with a stipulation that all contractors have security clearance. I have been with the same employer for 9yrs and I had my interview with background investigator. The investigator was asking me about my credit report; I have gotten into some medical and credit issues. He told me the government just needed proof that I was paying it off.
How would this affect me getting a clearance?
I already have one with another Agency that did not require any background check.
Haven't had a chance to read the entire thread, but the majority of bankruptcies are due to medical bills (are all these people unemployable now?), and an awful lot of people needed to default on their mortgages in the last five years because of the economy and being not only horribly underwater but needing to move and not able to sell. Add in that continuing to pay credit card bills to an obviously corrupt banking industry is questionable in its morality, (one day late and you are not only fined but your interest rate skyrockets to 29.9%, tactics which have since been determined illegal in court) and you have to wonder how anyone but a true money slave could have good credit anymore.
I agree with checking credit history for bonding purposes; other than that, it is a gross violation of privacy on the same order as checking someone's medical history before you hire them, or asking if they plan on getting pregnant soon...
My employer has gotten a new contract with the Fed Agency with a stipulation that all contractors have security clearance. I have been with the same employer for 9yrs and I had my interview with background investigator. The investigator was asking me about my credit report; I have gotten into some medical and credit issues. He told me the government just needed proof that I was paying it off.
How would this affect me getting a clearance?
I already have one with another Agency that did not require any background check.
I had a friend who applied for the TSA and he had some debt from student loans that were not being paid because he didn't have the funds so he did not pass and was removed from the process. I know with federal jobs they will likely run credit, which running credit in just about any job makes no sense to me. I think with federal jobs you can only have so much debt and from what I remember the number is fairly small. I don't know if its the same across the board for all federal jobs though so don't quote me.
Haven't had a chance to read the entire thread, but the majority of bankruptcies are due to medical bills (are all these people unemployable now?), and an awful lot of people needed to default on their mortgages in the last five years because of the economy and being not only horribly underwater but needing to move and not able to sell. Add in that continuing to pay credit card bills to an obviously corrupt banking industry is questionable in its morality, (one day late and you are not only fined but your interest rate skyrockets to 29.9%, tactics which have since been determined illegal in court) and you have to wonder how anyone but a true money slave could have good credit anymore.
I agree with checking credit history for bonding purposes; other than that, it is a gross violation of privacy on the same order as checking someone's medical history before you hire them, or asking if they plan on getting pregnant soon...
You forgot to mention the massive student loan debt that is currently going on and forces students to pay back there loans regardless, even if it screws up their credit.
You forgot to mention the massive student loan debt that is currently going on and forces students to pay back there loans regardless, even if it screws up their credit.
That is only the tip of the iceberg because as that poster mentioned there are many issues that cause one to have a lower credit rating. I'm still yet to see any evidence that truly shows a link between low credit scores and other irresponsibility or employee theft.
I've been completing job applications and going to job fairs, and what I've never understood is the assumed correlation between applicants and employees with lower than ideal credit ratings, and work productivity/overall performance. I thought that discrimination against the poor was prohibited under equal employment laws but apparently not, though it should be.
Why is it necessary for many employers to research job seekers' credit history? What does having a poor or fair credit rating actually reveal about an individual's ability to do the job? Why isn't it formally considered discrimination against the poor to determine employment based on assets and debts?
Surely without a job, people can't afford to keep an ideal credit rating, correct?
Your point is especially "on point" when you consider that employers are not seeing your credit history. All they get is a fico score, a number that says your credit worthiness is between x and y. No context at all. So they are not in a position to say that your credit is good or bad because of a or b. Worst, i imagine theyare not getting a history that says you "had" excellent credit - up until 5 years ago. They won't know that your credit score for instance has gone down because you stopped using credit altogether and now just choose to use cash. All they have is a number - with which they make assumptions about your character.
The practice should be outlawed.
Btw - they use the same rating to determine your car insurance premiums.
I vote no. Sometimes a person can be great with money and then life happens. They lose a job and have to take something much lower paying(i.e. minimum wage) to get back into the workforce. After all, conservatives are always saying they don't want welfare bums around and now won't hire them because they took a lower paying job. Gee might as well collect for two years.
Or, a friend of mine was diagnosed with cancer and suddenly was forced to use all of her savings to pay for treatments. She had great credit until she had to file bankruptcy on her medical bills. She was a great worker as well.
You could also have a divorce, car accident, other serious illness, kid with a serious illness that all can ruin a person's credit by racking up bills. Yet, a person who has experienced life is suddenly also a bad employee??? If anything, I would think someone who is a survivor of all the things I just mentioned might make a more motivated and enthusiastic employee because they need a job.
I see a lot of bad credit reports, and with very very few exceptions, the bad credit is do to some form of theft. Borrowing money that the applicant knows they can't repay, writing bad checks, using credit cards for things they know they can't afford and will never pay for, using utilities and never paying for them.
I'll see a hundred bad credit reports that are caused by bad judgement and dishonesty before I see one that the bad credit is due to job loss or medical bills.
If an applicant has really bad credit, even if they are a good honest worker, there is the very real possibility of their wages being garnished. Employers often will not deal with garnishments and employees can get fired for having their wages garnished. Why would the employer hire someone who has a high chance of garnishment?
On the medical bill issue, if a company provides health insurance, the insurance company is very likely to reject the applicant, anyway. There is very little reason to go through the entire hiring process with an applicant that the insurance company will not accept.
Not everyone with bad credit has a gambling addiction or drug habit, but all the gamblers and addicts have bad credit, so the employer can screen them out that way and there aren't many other ways to detect them.
If a business is only using the credit score, they are foolish. But it is certainly easy enough to get the whole credit report and that is most likely what the business is doing, is getting the complete credit report. There is other valuable information on there in addition to spending habits.
"selling for a multiple"? I don't have a clue what that means.
"getting a dime of goodwill" Goodwill in the form of what and from who?
Startup cash from most businesses in my opinion comes mostly from personal savings, I don't see what that has to do with ultimately raiding a retirement plan to keep an unprofitable business going.
I don't suggest anyone get a crappy no risk job with the man, (what's so bad about dealing with the man?) but it does make sense to grow the operation (or your personal savings) step by step while keeping any debt to a reasonable level. That'll keep you outta trouble with creditors, which is the theme of this whole thread.
I'm a landlord and I hear stories constantly from tenants/applicants about why their credit is sub-par. In all but a few medical related situations, the scenarios that I've seen could have been easily averted. Too many people simply will not take responsibility for their poor choices.
Funny. I used to be a landlord (well, I rented out rooms in my house that I lived in to people, not entire houses/apartments), and I often rented to people with low credit scores. The people with low credit scores were so grateful just for a decent place to live, that they were by far the best tenants.
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Gee might as well collect for two years.
