Bad credit checking is one of the ways that potential employers determine if someone is a security risk to the company. Having bad credit can literally cost you your job with some types of companies. Since employers can pull up credit reports and credit records, many companies are using bad credit checking as part of their human resources departments’ procedures. What does all of this mean for you?
Some companies feel that a person who has bad credit does not meet responsibilities well. After all bills and debts are financial responsibilities that we all must face and take care of. If you are an employee that cannot handle your financial responsibilities, many employers are reluctant to keep you on as an employee or to hire you. Even if you currently have a job and are doing well, some companies are using bad credit checking to decide which employees they will keep and which employees that they will fire. Current employees may be having problems at home that could later interfere with work and companies are not willing to take the risk. If they do their bad credit checking and find out your credit has suddenly gone sour, you are indeed at risk of being replaced.
Private and government organizations and businesses, that require employees to hold security clearances are also running bad credit checks on employees. The purpose of the bad credit checking by the human resource departments is to determine which employees might be easy to bribe for company secrets or confidential information. The belief is that an employee that went from good credit to bad credit is having financial problems and might be more easily tempted buy bribes, gifts, vacations or other financial incentives that competitors are offering to them. Instead of taking the risk, companies will do bad credit checking and find a petty reason to fire the employee instead of keeping them on if their credit has turned bad.
Bad credit checking is often used to screen employees. There are companies that have a place on the application for you to give permission for them to run your credit report. Other companies just ask you bring a copy of the most recent report in during the interview or attach to your application. These companies use bad credit checking to decide if they will hire you as an employee. The belief by these companies is that a person with bad credit is more likely to steal goods from the company.
For example, if you apply for a position that handles money or valuables such as diamonds, the future employer will do bad credit checking on you to decide if you are more likely to steal than other applicants. While this is not always a good indicator of who will be thieves and who will not, many companies use bad credit checking and rely on it for employment pre-screening.
In a perfect world, employers are supposed to notify you if you are fired or not hired because of bad credit checking. If for some reason your bad credit will affect your job and make you a risk, the company is supposed to notify you of this and give you an opportunity to rectify the problem.
The majority of companies that use routine bad credit checking and pre-employment bad credit checking will find other reasons to terminate you such as being late, out sick or not doing well on job tasks to fire you. Instead of telling you that you were not hired because of bad credit the potential employer may never get back with you or give some other excuse for not hiring you. The sad thing is that most of us never know that a less than perfect credit history can haunt us by getting us fired from a good job that we have, or keeping us from getting employed with a company that we like.
