5 Reasons to End Employment Credit Checks

1. Credit Reports are Notoriously Inaccurate

Studies have shown that one in four credit reports contains serious errors, and 79% of credit reports contain errors of some kind.

2. Credit History Does not Predict Job Performance

A representative of TransUnion, one of the “Big 3” credit bureaus, admitted under oath that “we don’t have any research to show any statistical correlation between what’s in somebody’s credit report and their job performance or their likelihood to commit fraud.” In spite of this, credit reporting agencies are aggressively marketing the use of credit reports and lobbying against bills that would restrict employment credit bills.

 3. Credit Checks in Hiring Have a Discriminatory Impact on People of Color

People and communities of color have been disproportionately targeted for predatory and high-cost loans, which contribute to damaged credit. The Equal Employment Opportunity Commission has stated that rejecting job applicants based on credit history “has an unlawful discriminatory impact because of race and is neither job-related nor justified by business necessity.”

4. Credit Checks by Employers Violate Workers’ Privacy

Credit reports can reveal deeply personal information, including about medical conditions, disability, or family status – information that anti-discrimination laws are intended to protect.

5. Credit Checks in Hiring are a Catch-22 for Workers 

Employment credit checks are a Catch-22 for workers.  Growing numbers of New Yorkers are unable to get jobs because of damaged credit, and unable to repay debts and improve their credit because they can’t get a job.  With NYC’s unemployment rate still elevated, the last thing out-of-work families need is another barrier to jobs.