Tuesday, January 26, 2010
Legislation Would Prohibit the Use of Credit Checks for Job Applicants
Nick Sohr posted an item on the Daily Record’s Eye on Annapolis Blog today about the credit check bill that has been introduced in both houses of the General Assembly. The legislation, SB 110 and HB 175, would prohibit an employer from using an applicant’s credit report or credit history when making hiring decisions unless there is a bona fide work-related purpose.
The Maryland Chamber’s Employment Relations Committee is reviewing the bills and reaching out to the bill sponsors to learn more. We’ve heard some initial concerns related to:
- Screening for employees who handle cash or financial information.
- How will the term “Bona fide work-related purpose” will be defined?
- Whether this issue is best handled at the federal level rather than having different states adopting different standards.
- How this fits in with other elements of background checks like reference checks and criminal background checks?
We’re trying to determine what kind of impact this would have on member companies. We’d appreciate any input you could provide. Do you use credit checks during the hiring process? Do you have any thoughts on this proposal?
Please email your comments to Allyson Black at .(JavaScript must be enabled to view this email address).
As one of the 19 +/- data destruction companies operating in Maryland, I can tell you that this will have a tremendous impact on our business. While it is not a requirement for our industry certification (National Association for Information Destruction, “NAID”), we began adding it several years ago when we noticed a few of our employess had passed our background check but failed those done by a couple of our customers. Though our customers would not tell us the criteria that caused the employees to fail, the common denominator was personal bankruptcy, which shows up in the credit check. The background check companies require us to provide “A Summary of Your RIghts Under the Fair Credit Reporting Act” to the applicants and and they sign a waiver to release the information. That should be sufficient. We don’t need the government getting involved in this! I can provide additional information on why it’s prudent and necessary in our field if you like.