Slashdot Mirror
Dealing with Employers Who Perform Credit Checks?
Rick asks: "I recently accepted a Director level position at a small, 40 person, technology company. On my first day, I was provided with all of the standard employment paperwork such as the W2, NDA, healthcare, etc., as well as a document that is to provide my permission for the Company to do a comprehensive background check on me, including a credit history check. I am now in a stalemate position with my employer in regards to this background check document. I have refused to sign on the grounds that my personal credit information is of no business to the company and that they have no basis of need. The company argument (COO level so far, CEO is next) is that the company instituted this policy over a year ago for all existing employees and new hires, and to maintain consistency, every employee must comply. The company also maintains that the information allows them to identify potential problems with candidates or employees, in that people who cannot manage their own finances may not be good employees, or that those with troublesome credit may be more likely to steal from the company. The COO used less direct terms, but ultimately that was the argument. Have Slashdot readers successfully negotiated out of a mandatory employee credit check in the past? What arguments did you use?"
.... seriously this should be a privacy issue. People with bad credit NEED jobs to get out of the hole they've dug. Give me a break.
I'm the big fish in the big pond bitch.
to the EU where they have proper HUMAN RIGHTS laws and employment laws, unions make the laws here.
Take youre brain elsewhere. US lost.
What next ? DNA tests ?
If they're issuing you a joint credit card, it might have grounds to stand on, but the best piece of advice you can get here will most likely be: Consult a lawyer in your own jurisdiction.
Marriage is considered capital punishment for the theft of a goat in some third world countries...
Unless you're hiding something, I wouldn't object. I had to submit to a full background check, and it didn't bother me.
I consider it a small price to pay to obtain unemployment. After all, if you won't take the job, and the check, there are thousands of other people who would jump at the chance. Its your choice though...
I couldn't get out of it, but I negotiated who would see my credit report, why they would see it, for how long, and how it was to be destroyed after veiwing. I got everything in writing and made them sign it.
If you're that opposed to it...quit. Their loss. By caving in you're just giving employers permission to walk over you.
Let your skills be your selling point...not your credit report.
They also read your email and monitor your surfing habits... them's the dregs. But it's their company, their rules, they're hiring you. If you don't like it, vote with your feet and walk away. Right?
Personally I'd be more worried if they told me they were going to do a check to make sure I didn't have Smurfs (replace with your race of choice) in my family lineage going back 100 years. Now that would be problematic.
This is becoming increasingly common, from what I understand. Insurance companies are also using credit scores to help determine rates for auto coverage. Miss a credit-card payment, and your car insurance costs more!
And the shadowy credit-scoring companies, largely unregulated, are the ones wielding all this power.
In your situation, you can try your argument, but then it will come down to submit to the check or don't take the job. The company is perfectly within its rights to ask for this information, especially for a managerial position.
It is reasonable to assume that someone who isn't smart enough to manage his own money would mismanage company money. I never understood bad credit. Why would someone think he can spend more money he has and get away with it? If you can't afford something, don't buy it. Geeze.
A slashdotter who didn't build his own computer is like a Jedi who didn't build his own lightsaber.
What goes around comes around. Remember all of those insane signing bonuses and perks that useless rockstar programmers and IT staff were getting 2-3 years ago during the boom? Well, now we get to see management and HR getting their chance to get some of their own back.
It's best to look at this as an exercise in schadenfreude: all of those wanna-be technolibertarians who spent most of the 90s shuddering and twitching at the mere mention of unions, collective bargaining or any other manifestation of labor rights now get to find out the hard way what life is like when management holds all of the cards.
That cold, unwelcome sensation invading your rectum? That's the invisible hand you professed to adore so much last year. Enjoy!
News for Nerds. Stuff that Matters? Like hell.
It strikes me that a company that cannot manage its finances responsibly would not make a good employer either...but would you be allowed to peek at their ledger when seeking a job? Even if it were a policy that you had set for yourself and you must apply it to all potential employers for the sake of consistent application?
The "cue the foo posts in 3, 2, 1..." posts will commence with no subsequent foo posts in 3, 2, 1...
That aside, I worked as a contractor many years ago for a very large software company (whose name ends in "soft") on a project dealing with a large financial institution. The process of checks was nearly as involved as those to get top security clearance. I understand the reason behind that, of course: by working on the project I became privy to information about how the large financial institution did business.
I am going to assume that the poster has bad credit. That in itself is not a reason to *not* get the job, especially if you are honest with your employer and state something like "I have had some bad luck in recent years, but, hey, who hasn't with the economy the way it is?"
All of that being said, I would sign the release. Companies need to cover their asses, and this is just one more way of them doing so.
Unless this is a job that you Really Want (or Really Need, for that matter), tell 'em to stick it. Times are tough for job-finding, but at the end of the day, it's just a job, and not worth sacrificing your principles over.
Whether or not such a credit check is deemed "necessary" for a Director-level job is not really relevant, in my opinion: if it's personal information that you don't want to give, don't give it, and if they don't like it, tough.
I wouldn't work for a company that wanted to a credit check, drug test, etc. on me, simply on principle.
It's not unusual to see credit checks as part of a security clearance check... as people with great debt are often more likely to sell information or be otherwise comprimised by the offer of money.
However, I don't know what the law says about it with respect to general employment. Check with a lawyer before you do anything to rash (either way) if it really concerns you.
BlackNova Traders
I hate to say it, man, but the higher up you are in the food chain, the more important it is for them that they check you out. If I were them, I would already have told you to take a hike.
I know of too many cases of executive malfeasance to agree with your assertion that your financial history is none of their business. Particularly given that people are generally afraid these days to say anything honest in a reference because they might get sued.
> Is this the kind of company you want to work for?
Yes, and more importantly, the more people who refuse to submit to this the less companies will do it. It is hard and expensive to go through stacks of resumes, find a good candidate, interview, make an offer, get it accepted, etc.
I walked out on 2 different offers for this very reason. Just the looks on their faces made it worth it. They were back to square one. And my credit was average, OK. If we all would've used our integrity a little more when it would've really counted, and said NO we wouldn't have to pull down our pants and pee in a jar to get a job today. Now its probably too late.
Do yourself and everyone else a big favor, refuse to do it. Period. And make sure the company knows why.
Operator, give me the number for 911!
I'm not sure that there is anything Google can't find.. Have you ever tried to Google for something and NOT found it?
People with mod points, please keep this at level 5. The URL is a pointer to a site that describes both state and federal laws regarding this situation.
"Champagne for my real friends - and real pain for my sham friends!" http://ericblade.postalboard.com/
They own the company and should be able to run it anyway they want.
In that case, they should be able to hire only big breasted, white women and make fellatio
part of the job description. If there are laws to prevent discrimination based on other factors then why not on credit worthiness?
If they are asking for your credit history then it is safe to assume that they will not hire you if you have bad credit. Unless they can prove a specific correlation between bad credit and bad work habits then I think they have no right to do so.
Personally, I don't have bad credit (never miss a payment) but I am pretty far into debt. This doesn't mean I am a bad employee. On the contrary I like to think that I am pretty highly regarded (and I have the bonuses and reviews to back it up).
(Note: I work in the US. Other countries may differ).
For some occupations (e.g. top-secret department of defense stuff), they do credit checks on you to determine if there's a risk you'll be bribed to disclose things.
In similar occupations, declaring bankruptcy is a reason for losing your clearance. Lose your clearance, you lose your job.
In other occupations, such as the Financial Industry (I work for a mutual fund company), I was told that they would need to run background checks, credit checks, FBI checks, state checks, local checks, and every other check they could think of as a condition of my working there. I don't know if there is an SEC requirement to do this, or if it's just the company covering their ass, but it's a blanket policy, with no exceptions.
This was discussed with me during the final interview, so I knew what I was getting into. Every employee who works for this company has to be bonded, fingerprinted, researched, yaddah-yaddah-yaddah. Every contractor goes through similar stuff, plus NDA's, etc.
Unless you work in an industry where these types of checks are common (and it doesn't sound like it), I would tell them to stuff it since they didn't talk to you about it in the interview. If they want to push, call the ACLU, get a lawyer, and go kick some corporate ass for wrongful termination, discrimination, and stupidity.
Think about it. What would you do if they asked you to sign a paper stating that you were no longer a member of the communist party? That you were no longer homosexual? That you let your membership in the KKK expire?
Karma: Food Fight (Mostly affected by Date Plate).
Cheers,
-- RLJ
Your theory about personal money management versus corporate, while on the surface makes sense, in actual application you would be surprised. Something about micro versus macro I'm sure. As well, where did the author insinuate he/she was managaing company money? If I'm a programmer or sysadmin, what company money do I get to manage? Usually none, other than casting my vote for a certain product.
Lastly, on "I never understood bad credit" well congratulations. I've never understood people who claim not to understand that sometimes people make mistakes, get laid off, or have problems with personal finances.
You might as well say that you've never understood speeding, over-eating, alcoholism, drug addiction, clinical depression, e.t.c.
I pulled a jack move to cop this sig
I never understood bad credit. Why would someone think he can spend more money he has and get away with it? If you can't afford something, don't buy it. Geeze.
Let me help you understand. When you move out of your mom's house you have to live somewhere and you have to be able to get from where you live to work. These are all long term obligations that might last longer than your current job. Rent that looked trivial with a normal pay check is hard to meet on unemployment. Housenotes plus utilities are worse. If you don't have decent public transportation where you live, you also bought a car. You will go "upside down" on the car as what you can sell it for won't cover the costs of the loan you made to buy it unless you got a really good deal on a used car. Obviously you don't have a wife or children.
Now for something that sucks. A company can look at your credit record and tell the difference between someone who's been honestly screwed as above and someone who blew loads of money on trivial bullshit like a home entertainment system, a sports car, and all the other joys of life worker bees like you and me are not supposed to enjoy. Most companies like for their employees to be good little self sacrificing suckers. Sailing, fishing, sking, that's for the boss. Sadly, companies are in a position to make these kinds of demands.
I'd comply, because I've been a good little self sacrificing fool and I've had family money to fall back on everytime I've been screwed. At age 36, with a 14 month old baby girl and wife to support, my decisions impact more than myself now and I can no longer stand entirely by my principles.
Still, I understand this man's pricipled stand and hope the best. He's right, it's none of the company's business and they can only use it pick out people they think they can abuse. We're not talking about possitions spying for the government where dishonesty is a given, we are talking about normal jobs at normal companies.
DMCA, Hollings, Palladium. What might have sounded like paranoia is now common sense.
While I was outraged when first reading the story, my mind was changed by a comment that a /. user made.
/., go ahead and let them dig through your closets for those unpaid utility bills!
While it is true that any kind of backgound check, whether it is a criminal record check, a credit check or your routine drug test, does impose on your privacy, there is a simple question you should ask yourself:
How would I like someone, wacked out on crank, in desperation for more money in order to purchase crank with, perforate me in my own, lowly cubicle with an Armalite AR-10 Carbine-gas powered semiautomatic?
I think the answer to this question is obvious.
This is why companies do background checks. While the criminal record check can be advocated using arguments such as, "We are protecting the rest of our staff from the criminal-likes of you," a credit check basically protects the company (theft wise), which in turn also protects its employees, meaning you. So, unless you have something to hide, as previously mentioned on
pocketdemon.
I can understand the privacy issues on this, but there are some cases where it is a necessity.
I work for a bank and prior to starting they did one on me. My credit is good and I take strides to keep it that way so I didn't mind so much.
HR departments often do Employment credit reports that do not show up, from what little I understand, as a normal credit check.
Some businesses have to go to great lengths to protect themselves. Working at a bank, I am exposed to critical details we use to verify identity of customers - that can be easily abused. If you have an employee who's deep in the hole - there is a higher chance they may abuse some of that information to magically "fix" that debt problem. It also is a way for them to check to see whether a given employee's debt load isn't so high that the salary they are planning to pay them can't cover it.
Would you hire a full time employee knowing that whatever you plan to pay them is in no way possible going to cover what their expenses are? They would either not last, be totally wiped out from working multiple jobs thus ineffective, or at worst screw you out of as much money as they can.
A credit report is no guarantee that a given employee won't screw you/your customers over. I for one would feel perhaps a bit more comfortable knowing X employee didn't have motivations to use me/my identity.
Yes, the check is perhaps a little intrusive. As long as my information isn't leaked/abused I personally have no problems with it. I can understand how it would make things all the more frustrating if I were out of money with bad credit on top of that. It has a very nasty potential for becoming a vicious cycle. As far as I know, there are no laws on the books to protect potential employees from being discriminated against on the basis of credit rating. (is there?)
If I were in your shoes, I would say no, politely and firmly:
If they didn't let the issue drop, I would talk to a qualified attorney. Pursuing the matter would probably irreparably damage your relationship with your new employer. But, then again, if they really pulled something this weaselly, maybe they aren't the good employers you thought they were when you signed on.
Easy, automatic testing for Perl.
What noone has mentioned is that he says he is a director of the company. Now, in reality, people get all kinds of titles and it may not mean what it implies, but a director has legal standing to act as part of management. This includes incurring financial liabilities for the company. Of course you should check out the credit of someone in that capacity.
When the company I currently work for wanted both a Credit Check and a Criminal check I agreed.. on three terms:
1. That they give me a copy of the companie's Dunn & Bradstreet credit check- if they needed to know my history, I would get theirs.
They ended up deciding that my credit score was sufficient, and so I got the companies!
2. That they would give me a copy of their workmans comp/ OSHA review in exchange for my Criminal Background history.
We did do this and everything worked out just fine there.
3. That we would review these items together, they would destroy their paperwork and I would destroy mine. Then we both signed a statement attesting to the review and distruction. The only thing kept in my files is the fact that it was done and I passed.
Just a suggestion as they get what they want but it cost them equally. If they need to know, then you do too and it gives you the chance to review things with them so that they do not get the wrong idea. Also, with the companies info wide open they better understand the privacy issues at stake.
Huh?
I'm not sure why you are lecturing the guy. These reports are too invasive. If they just want to know if you declared bankruptcy, have huge outstanding debt, or other things, they can ask on the application form. It would be illegal to lie.
The credit report gives away a lot of information about you:
* How many cars you have owned, how much you pay for them, if they are paid off
* When and how much you paid to go to school
* Your marital status
* How much money you have invested and in the bank
* If you are divorded and paying alimoney or child support
* If you were ever late on a payment
* How much you spend a month
Tons of shit they don't need to know.
And the whole "if you are in debt then you might steal" could apply everywhere. Why not just round these people up right now. They are future bank robbers!
I really don't like this tendency to pre-judge people. Let's judge based on past actions, not on genes, debt level, income level, actions of family, and "profiling".
You'll see more credit reports for more things. Some movie rentals now require them!
And every credit report dings your credit rating slightly (yes, only up to a certain number of points, but still).
As an employee, why can't I ask for all employee feedback to HR? After all, I'm entitled to it since it will tell me if they are likely nice to their employees or not. Oh, that's confidential? Something about privacy? Why doesn't that apply to me as well?
You sure drank the kool-aid didn't you?
"Because he says so?" - No because the people who are hiring him took the time and made the effort to get a good understanding of his character and abilities by actually interacting with him on a personal level as part of the hiring process.
Instead they want to skip that hard work and delegate the responsibility to a computer system, a system that is incapable of even coming close to the kind of personal evaluation that is required for the level of trust involved. Simplistic computer system means plenty more opportunity for error, and if the candidate were actually malicious he could easily manipulate the system to make him look good (via identity theft as one option).
You have a case in turning down the credit check.
1. It is NOT industry practice! If it were, you wouldn't have brought it up for discussion. You honestly did not expect this.
2. They didn't inform you before hiring you! Again, if they did, this would not have been such a shocker.
3. It's too late! They already told you, that you can have the job! If the IDIOTS were to wisen up, they would figure out that they should have had you sign, and have done the check, and have made their hiring decision based on the check, or the check is TOO LATE.
IMNASHO, if your employer were REALLY interested in this, they should have had you sign it BEFORE the hiring. Now, having accepted the position, requiring this check is tantamount to extortion. It'd be like Motorola waiting until AFTER you are hired to tell you about their drug check policy, and waiting till AFTER you are hired to pee in the collection jar. If I remember right, they tell you about this as you are interviewed, and you have to provide your specimen (and pass the lab test) before they'll hire you. If you have privacy qualms, that's the best time to step out of the situation. This is the way it was 10 years ago when I left Motorola, hopefully they have dropped the entire policy by now.
I'm one of the poor devils that got a job with Motorola before they instituted the drug policy. I don't/won't/never will do drugs, but when they instituted the policy, and presented all us employees with the ultimatum: be tested or get out, I started looking for a new job. My determination was, I've got a family to feed, so I'll provide the sample if requested, but I don't agree with the approach, and I was out of there in less than a year. My ultimate feedback of my opinion about their policy. A co-worker refused the test, on principle, and was immediately escorted out the building.
I guess those looking for a job had best ask what agreements they'll be expected to sign, if the employers aren't smart enough to tell people up front. Not informing is downright dishonest! It has the feel of "playing dirty tricks" on people. It's despicable because a job is no laughing matter to the guys getting hired.
Dogs look up to men; cats look down on men; But Pigs! Pigs can look men square in the eye. -Churchill
An employer doesn't want to know if you were late on your visa bill.
Say you ran up a bill of $20k and a company had to write that off. This and other forms of fraud are notated on your credit report. That's what they're looking for: history of fraud, dishonest or intentionally irresponsible dealings. They have a right to that information, as long as they get your permission to obtain it. If you don't trust them with your credit report then why do you even want to work there?
I have personally had to review these credit reports, and it's not a big deal. Lots of folks have credit problems--that's not the point. W few have a real pattern of dishonesty that only comes out in a credit report. Do you want them having access to your personal financial information at a bank? Or how about medical records?
no, it's called FUCKING UP YOUR CREDIT
why should an employer be allowed to do something to me that will decrease my credit score???
maybe to discourage jumping around to various jobs too often? lemme tell ya, get 10 inquiries on your credit check and you will NOT be happy with your FICO score...
A year spent in artificial intelligence is enough to make one believe in God.
The arguments have been made, and rightfully so, that your credit does not nessisarily reflect you as a person or how you will perform in their job environent. Bad times happen and people are forced to make choices to survive those times, credit be damned.
However, there's another point I haven't seen addressed. Credit companies are sloppy. I know of more than a few cases where it took somebody moving Heaven and Earth to get some error on the companies part rectified.
Creditor: "You owe $500!! Says so here!"
You: "Um, no. That was paid. Infact, I have the reciept here."
Creditor: "Oh! Just fax us a copy and we'll take care of it!"
You: "ok..."
~a month later~
Creditor: "You owe $500!!"
These people aren't exactly the pillars of timeliness and accuracy and certainly not a benchmark to be used in employment. Get a criminal record. Urinanalysis. Something. But not credit...
You need a FREE iPod Nano
No, he's confusing stupid with stupid. :) I'm from Texas, I live in Austin and know a good many smart Texans. Bush is not one of them. But I don't care if we have a moron in office so long as he doesn't make the same economic mistakes his daddy's boss made twenty years ago. Reaganomics is a textbook example (literally- economics textbooks use it as an example) of how NOT to steer national economic policy. Personally, I don't think it was ever supposed to work, just be a passable explanation for giving rich people more money.
The other problem I have with Bush is that he does not act in the best interests of the country. Look at Ashcroft for example; 90% of Americans would think he's a total religious nutcase if they knew more about him (indeed, his father was a minister in a semi-cult, the Assembly of God) and most of us do NOT agree with anything this man has to say. Yet he's our Attorney General. I have a feeling Ashcroft will eventually piss the wrong people off and become a political liability, so the decision might come back to bit him in the ass, but whatever.
</OT Rant>
I do not have a problem with a company performing any kind of check they wish on a prospective employee - especially for a director level position as the poster said they had accepted. It should, however, be known in advance at an early time in the interview process that these checks will occur.
"We are a drug free company - Stoners need not apply" Ok - abstain for a couple weeks before the UA test.
As an employer if I had two equally qualified and experienced prospects with great personalities - one of which had a great credit history - one owing thousands of dollars to creditors with outstanding legal judgements and such - I would most certainly pick the one without problems.
Being able to make payments on time is a general indication of an individuals level of responsibility. Not exceeding your limits, etc.
People fall upon hard times from time to time. An employer who does not accept or understand a loss of job, divorce, etc. for temporary credit issues is not one I would choose to work for. Persons with longstanding persistant credit issues I would be wary of.
Now for the legal note:
If the employer has already offered you a job and you accepted - showing up for work and THEN informed of this credit check requirement you will likely be ok declining in most states UNLESS the job offer was contingent upon submitting to the credit check.
This is common with criminal and drug checks. In many states the employer MUST offer the position BEFORE any drug or crim check and when they do so they are bound to the job offer as long as the check comes back clean.
They must offer you a job based on the information they have prior to the check and let you know that a check will take place. Only then they can retract the offer if they find out you're a felon or whatever.
If they offered you a job and it was not stated that the offer was contingent on the credit check - tell them to f*** off. Read any documents you had signed prior to the offer being made and see if it was mentioned. Check with your state laws as they do vary.
RLC