Illinois Legislation Addresses Employment and Credit Reports

11-Aug-2010 In the current economy, there are fewer jobs available and more applicants applying for fewer jobs. Adding to the increasingly competitive job market, many companies are basing employment on credit reports – at least in part. According to a Society for Human Resources survey, 60% of employers are using credit checks to assist them with the hiring process, up from 35% in 2003.

What Does Credit Have to Do With Employment?
From a hiring company’s perspective, hinging employment on credit checks helps them to pare down an overabundance of applicants using specific and measureable criteria. From a potential employee’s perspective, it can feel like an invasion of privacy or an unfair disadvantage depending on the job opening.

Many consumers are at a point where they are falling behind on their bills or even filing for bankruptcy due to unemployment. Now they may be further disqualified from regaining employment because of their poor credit or past bankruptcy filing. It becomes a vicious cycle. However, for employers pulling credit checks in Illinois, things are about to change.

New Legislation in Illinois, other States
Three states – Washington, Oregon and Hawaii – now have laws in place pertaining to employment and credit reports and Illinois is well on its way, waiting for approval from the state’s governor. These laws bar potential employers from requesting credit information from applicants unless they can prove that it pertains to the job function. While there are already laws in place to prevent discrimination based on bankruptcy or poor credit, these new laws will ensure that companies are not even given the opportunity to discriminate – by denying them access to the information in the first place.

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