Pamela Devata and Caitlin Senff Published in Human Resource Executive Online
"Using Credit History Wisely"

Pamela Devata and Caitlin Senff's article "Using Credit History Wisely," was published in the January 5, 2010 issue of Human Resource Executive Online. In their article, the authors report that national employers have been experiencing an increase in EEOC requests for information concerning background-screening procedures and policies. They also outline the recent lawsuits brought on by the EEOC challenging such procedures. Pam and Caitlin note, "As part of the E-RACE (Eradicating Racism and Colorism from Employment) Initiative, the EEOC has determined that employer policies or practices based on an individual's criminal or credit history may have an overall adverse impact on certain protected classes, namely, African-American and Hispanic applicants/employees."  According to Pam and Caitlin, "With concern mounting by federal and state officials about the adverse impact of the use of credit checks as part of the hiring process, HR leaders should take the time to rethink—and possibly revise—their background-screening procedures and policies."

The authors explain that state legislatures are taking action to pass similar laws protecting individuals from being unnecessarily impacted in their employment as a result of their credit histories. Pam and Caitlin suggest that employers should be “particularly aware of the status of the state law in each of the states in which they do business.” They further suggest that employers evaluate pre-employment inquiries and hiring procedures and consider using credit more narrowly. They conclude, “The most critical proactive measure employers should take is to have their background-screening policies, employment applications and hiring criteria reviewed by counsel.”