EEOC sues over employer use of credit record in hiring

by Walter Olson on December 22, 2010

Following extensive rumblings of an impending crackdown, the Equal Employment Opportunity Commission has sued Kaplan, the private education company, over its alleged policy of considering applicants’ credit records in making hiring decisions [Baltimore Sun, George Lenard; earlier here and here]

More from Ted Frank: “Somebody should tell the Transportation Security Administration, which also performs credit checks: they reject job applicants if they have more than $5000 in overdue debt.” And from the same link:

But what’s also driving the push to check credit is fear of lawsuits, [employment attorney Manesh] Rath said, especially in businesses where employees have access to customers’ money or possessions, including the banking, property management, hotel and home health care industries.

…”The employer will have a tough time defending itself,” Rath said, “if it didn’t take the simple measure of doing a background check.”

{ 2 comments }

1 Anonymous Attorney 12.23.10 at 2:32 pm

“Disparate impact” turns discrimination law into a tool for achieving equal outcomes, not equal opportunities. The EEOC should be renamed the EOC — Equal Outcome Commission. See my blog on this at VDare.

2 Robert 12.24.10 at 6:39 am

I hope it will remain legal to check credit history.

I, for one, don’t like to hire people who were part of the irresponsible borrowing that led up to our latest great recession. I won’t hire someone who took out a mortgage he couldn’t possible pay back; failed house-flippers and home debtors. Nor anyone that worked selling real estate or mortgages. I want to contain the pain to those responsible for this mess.

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