Posted with permission from ESR Newsletter and Legal Update, a newsletter by Lester S. Rosen Esq. and Employment Screening Resources (ESR), www.esr.com
On September 13, 2007, VISA USA issued a press release with the headline: “Americans Unaware That Employers Can Legally Refuse to Hire Job Applicants With Low Credit Scores.” The story said that, “the vast majority of Americans do not know that a bad credit score is more than just a barrier to getting a loan -- it may also keep you from getting the job you want.”
The problem with the story? It is just not factual. The plain fact is that employment credit reports simply do not contain a credit score, since there is no validity in studies that suggest a credit score bears a relationship to employment. It is, of course, fair to say that employers can access an employment credit report which can contain elements of a credit history, so that meeting obligations may be helpful for employment. But to say the credit score is used or provided is factually incorrect.
Unfortunately, the story was then repeated as though accurate in another Bay Area newspaper. The problem with such inaccurate information of course is that it can only cause consumers to suffer unnecessary worry and anxiety. In addition to any other worries, consumers with low credit scores may now think they must worry about employment as well.
Fortunately there was one reporter who saw through the Urban Myth and exposed it for what it was. Columnist Brian O'Connor of the Detroit News set the record straight that employers do not get credit scores and that the credit scores are meant for credit risk and not employment. His advice: “So any job-hunters out there can stop worrying about whether last month's late utility bill will keep you out of work.”
The bottom-line: VISA USA does a commendable job in bringing financial education to consumers, but even they fell for this urban myth. It demonstrates once again that background checks and hiring are complicated subjects that are heavily regulated and present a number of potential traps for the unwary.
