Credit Checks Basis for Employment Discrimination

For those seeking a job, credit problems may be unavoidable. Long periods of underemployment or even unemployment, can wreak havoc on the most financially stable person. Unfortunately for many job applicants, employers commonly check an applicant’s personal credit history before making a final hiring decisions.

Credit checks can be a real barrier to employment for applicants with credit problems. Lower income or middle income applicants may have lower credit due to reasons beyond their control. Many credit reports contain serious errors, and even if the errors are quickly spotted, the process to fix errors is time consuming and difficult.

Applicants with credit problems may be tempted to lie on the application, to hide the issues from their future employer. However, in most cases, lying on an application would be sufficient to cost applicants the job. Since many jobs don’t complete the background checks until after an offer is made, or even after you start, lying could even get you fired after you start a job. As with all parts of the application, it is critical for applicants to be honest regarding their credit.

Legislators are starting to consider limiting the way in which employers can use credit information. Medical debt compromises a significant portion of credit issues in low to middle income workers. The credit issues could be related to unemployment, and are thus not a good indicator of the employee’s responsibility. For many jobs, such as stock clerk, credit history should be completely irrelevant to the ability to carry out the responsibilities of the job.

Under federal law, employers can run a credit check on both job applicants and on existing employees. They do have to obtain written permission from you prior to running the credit check, and notify you if they take adverse action (such as refusing to hire you) based on the report. Different states may set different rules limiting the use of credit reports, and legislation is currently pending in New York to do just that, protecting applicants from invasive questions at early stages of the application process.

Contact NY Employment Law Lawyers

If you have concerns regarding how your credit reports might be used by employers, you should contact a qualified attorney. The law firm of John J. Zidziunas & Associates has a team of NY employment law lawyers ready to review your claim. For further information, call 973-509-8500, email, or visit