Many employers conduct background checks on potential employees before making a job offer, including checking their credit history. This can raise concerns for job seekers who may be worried about the impact of their credit score on their employment prospects. In this article, we will discuss the legality of employers checking credit history and provide some tips for job seekers.
Is it Legal for Employers to Check Credit?
The answer is: it depends. In the United States, employers are allowed to check an applicant’s credit history, but only in certain situations. For example, if the job requires financial responsibilities, such as handling money or sensitive financial information, the employer may be allowed to check the applicant’s credit history as part of the background check.
However, some states have laws that limit an employer’s ability to check an applicant’s credit history. For example, California, Colorado, Connecticut, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont, and Washington all have laws that limit or prohibit employers from checking an applicant’s credit history.
What Information Can Employers See?
If an employer does check an applicant’s credit history, they will only be able to see certain information. For example, they will be able to see the applicant’s credit score, payment history, and any delinquencies or bankruptcies. However, they will not be able to see the applicant’s credit card balances, account numbers, or other personal financial information.
How Can Job Seekers Protect Their Credit?
Job seekers can take steps to protect their credit during the job application process. First, they should check their credit report before applying for jobs to make sure there are no errors or inaccuracies. They can also consider placing a credit freeze on their credit report to prevent unauthorized access.
If an employer does ask to check their credit, job seekers should be honest about their credit history and provide any relevant explanations or context. They can also provide references from previous employers or colleagues who can vouch for their financial responsibility.
Employers may be allowed to check an applicant’s credit history in certain situations, but there are legal limitations and protections in place. Job seekers can take steps to protect their credit and be honest with employers about their credit history. By understanding the legalities and taking proactive steps, job seekers can navigate the job application process with confidence.