3 Things Job Seekers Need to Know About Credit History Discrimination

Workplace discrimination is never acceptablePotential employers illegally discriminate against job seekers for various reasons, such as ethnicity, physical appearance, disability, sexual orientation or gender. However, potential employers also discriminate against job seekers who have poor credit histories. There are several nuances to California and federal laws job seekers should be aware of.

  • In 2012, California became one of a handful of states that banned credit history discrimination under most circumstances. This means for many jobs, employers cannot make hiring decisions based off information found in credit reports.
  • Employers can only use credit reports to make hiring decisions in very specific circumstances, such as for certain positions. Some positions require workers to handle money, or may put them in a position of authority where bribery becomes a possibility. For example, aspiring police officers in California can be denied employment based on a negative credit history. Other positions that fall under this category include jobs handling large amounts of money or customer accounts, managerial responsibilities, or careers that allow access to proprietary information. Jobs in banking and real estate may fall under these categories.
  • Employers must ask for permission before pulling your credit history under rules stipulated in the federal Fair Credit Reporting Act. When an employer asks to pull your credit history, it is usually during the interview process.

Can I Be Fired for Bad Credit?

Job seekers are not the only people facing credit history discrimination. Workers facing difficult financial situations might also face workplace discrimination or wrongful termination. However, in most situations you cannot be fired for bad credit in the state of California.

Some financial situations are beyond our control, such as excessive medical debt or divorce, and it is unfair that job seekers should be denied a chance to receive gainful employment to repair their credit ratings.