Privacy Risk for Job Seekers
The United States currently has a huge unemployment rate because many companies are being forced to down-size or close. This has caused many people, some who have been working for the same company for years, to lose their jobs. When a position does become available, and with thousands of people out of work, for every 1 job opening, there are hundreds (if not thousands) of job seekers sending in resumes and applications. With so many resumes and applications to go through, it becomes a nightmare for the Human Resource Department to find just the right candidate. In order to make things easier, on every application sent in, there is a section asking for the applicant’s permission for the company to run a credit check.
Many people don’t understand why this is being done. Well, a credit check helps a company immediately weed out the applicants that they feel are “undesirable” because of a poor credit rating. In other words: Bad credit means no interview. This system of weeding out applicants lessens the amount of interviews and call-backs a company has to make because in a field of 1,000 applicants, more than half of those could be discounted immediately due to their credit score. The theory says that a low credit score means that a person is untrustworthy and unreliable, so if your score is low, your application or resume won’t make it to the desk of the person in charge of interviewing.
When a person who has been in the same job for many years hears of this practice, they can’t believe this is happening. If you are in a group of friends who are lucky enough to still have jobs, and voice your frustration about not being able to find one, they will sometimes assume that you really haven’t been trying. Yes, a failed drug test or a background test that shows any arrest would lessen your chances at finding work, but, bad credit? How can this be? A simple solution given would be to not agree to the credit check, but, that is viewed as you having something to hide and you will no longer be in the running for that job.
There are a few flaws in this theory of hiring by credit score:
1. Employers don’t take into consideration that an applicant may have been out of work for a while. They don’t care that your inability to keep up with your bills has to do with your unemployment; they just care about the score. If it’s low, you will not even be interviewed or asked to explain your position in the matter.
2. When you’re unemployed for a period of time, you need to pick and choose which bills need to get paid and which bills can wait. Paying less than your minimum payment will be seen by employers as you being unreliable and you will be categorized as “high risk”, meaning that you would be likely to steal from the company. No consideration is given to the fact that you need a job to keep up with payments to raise your credit score.
3. For each company that runs a credit check on you, you are losing your privacy by having an untold number of people view your credit report.
4. Many people send in resumes and applications daily. Jobs are applied for that are out of the norm for some of these people because their usual field is saturated with applicants. If a person sends in 50 applications a week, that means that 50 companies are asking for your credit report. This will lower your credit score even more because it will appear as if you are applying for more credit, not just looking for a job.
Bills get farther and farther past due as the length of unemployment gets longer. When this happens, you appear even less desirable as a qualified candidate for a job. Statistics tell us that the unemployment rate has gone down, but does that take into consideration the people who have been unemployed for over a year and their benefits have run out? Unemployment hasn’t gone down; people are still unemployed, but no longer are eligible to claim benefits.
If the main provider of a family is out of work, and unemployment benefits run out, what happens to the family? In order to get a paycheck, many people have taken jobs making minimum wage, but it’s difficult to pay for utilities and rent on minimum wage. It’s not right that these honest people can’t find a good paying job because they have a low credit score.
Now, besides the stress of needing a job, you also have to worry about how your privacy is affected by each company running a credit check on you. For every company that runs a credit check, there are strangers in that company who will have access to your credit report. These strangers will know not only what credit cards you have, but they will also know the balances of each card and how long they are past due. They will know your Social Security Number, where you bank, and your bank account number. They will know if you have any judgments against you, and if your home is in foreclosure or if your vehicle has been repossessed. These strangers will also know if you are paying any fines, even if it’s for a traffic offense. This is all information you don’t want given to random strangers, yet you must give it to companies before you are even considered for a job.
Hopefully, you will never run into this situation, but, you never know what the future holds. Maybe now is the time to inform our lawmakers that this practice is unacceptable. Laws need to be written so that companies can be penalized for continuing this unfair practice of hiring by credit score.
