The credit check includes your credit history and personal information like your name and address. A company may compare the identifying information from your credit report to the identifying information in your application to further verify who you are and help prevent employment fraud.
The law imposes several conditions on users who pull consumer reports for employment purposes experian s employment insight report.
Credit check for employment purposes. You must give consent. Shrm data backs up that assertion indicating that employers primarily use credit checks for applicants seeking employment in either financial security or fiduciary roles within an organization. Shrm data backs that assertion up indicating that employers primarily use credit checks for applicants seeking employment in either financial security or fiduciary roles within an organization.
Before an employer can get a consumer report or run a credit check for employment purposes they must notify you in writing and get your written authorization. Learn more about legal guidelines. By state or federal law or regulations or by a self regulatory organization to use an individual s consumer credit history for employment purposes are specifically exempted from the provisions of the scdea.
Thanks to the fair credit reporting act prospective. California colorado connecticut delaware hawaii illinois maryland nevada oregon vermont and washington. That means when employers check your credit they will only be able to see your modified report and not your score.
Checking a potential employee s credit report can be used as an additional security measure to help verify an applicant s identity. Frequently asked questions. The fair credit reporting act as amended by the consumer credit reporting reform act of 1996 allows users access to a consumer s credit report for employment purposes.
The eeoc oversees how credit information can be used in hiring decisions. The state limits on employment background credit checks aren t universal prohibitions they come with some practical exemptions. The fcra defines a background check as a consumer report.
The fcra sets standards for employment credit checks. An employment credit check is when a potential employer checks your credit history to see how you ve handled consumer debt. If the applicable law or regulation only requires pre employment.
Currently eleven states limit the use of credit checks reports for employment screening purposes. The fair credit reporting act fcra sets the standards for screening for employment.