Congressional representative introduces bill to prohibit the use of credit checks for job applicants

 Rep. Steve Cohen (D. – Tenn.) has sponsored a bill that would prohibit the use of consumer credit checks against prospective and current employees for the purposes of making adverse employment decisions. H.R. 3149, the Equal Employment For All Act would amend the Fair Credit Reporting Act to prohibit a current or prospective employer from using a consumer report or an investigative consumer report for either employment purposes or for making an adverse action, if the report contains information that bears upon the consumer's creditworthiness, credit standing, or credit capacity. 

Representative Cohen stated, “at a time when people are struggling to find jobs, credit checks should not be used as a basis to deny employment to otherwise qualified candidates.” Consumer advocates favor this bill, especially given the current state of the economy. In times such as these, debts accumulated because of layoffs, divorces, medical conditions, or other circumstances should not be held against potential employees. Edmund Mierzwinski, a consumer advocate with the U.S. Public Interest Research Group pointed out that up to 33% of credit reports contain serious errors, so job seekers may be penalized unfairly.

Opponents of the bill feel that if a job includes fiduciary responsibilities, employers should be able to have access to credit information. Jason Morris, president of a company that runs background checks for businesses, says employers should have access to the data. “If an employer is on the fence about an applicant, credit reports can be valuable.”

Of course, the bill does contain exceptions. People seeking employment: (1) which requires a national security or Federal Deposit Insurance Corporation (FDIC) clearance; (2) with a state or local government agency which otherwise requires use of a consumer report; or (3) in a supervisory, managerial, professional, or executive position at a financial institution would be required to submit to credit checks.