Background Checks, Credit Reports and Credit Scores

Nick Fishman

Lately, there is a heightened interest in the use of credit reports as part of the employment screening process.  There have always been some misconceptions about what information employers are actually able to see.  We wrote about these misconceptions in the article, Credit Reports: A Window to the Soul, where we dissected the difference between Consumer Credit Reports and the Pre-Employment Credit Report employers use.

The biggest misconception is that employers will use your FICO credit score to make a hiring decision.  A Pre-Employment Credit Report does not contain a credit score, does it include full account numbers and the inquiry does not have a negative impact on your credit score.

See article below from the Dallas Morning News.

While prospective employers can pull your credit report with your permission, they can’t get your credit score.

“Credit scores are not provided along with the credit reports that the bureaus sell for employment screening,” said John Ulzheimer, president of consumer education at Credit .com, a credit information Web site.

Here are the positions taken by the three national credit bureaus, Experian, TransUnion and Equifax:

• “The key point to consider here is that credit scores are not predictive of employment performance,” said Steven R. Katz, director of consumer brand at TransUnion. “They are designed to predict the likelihood of such things as an individual defaulting on a loan or filing for bankruptcy.”

• “We don’t provide credit scores with an employment report because they’re not extending you a loan,” said Michele Boddavice, president of product management and development at Experian Credit Services. “There’s no relevancy there to your credit score and an employment decision.”

• Equifax doesn’t “provide credit scores or files [credit reports] for pre-employment screenings,” said spokesman Tim Klein.

 

Nick Fishman
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Nick Fishman

Nick Fishman is the co-founder of EmployeeScreenIQ, a leading, global employment background screening provider, and serves as the company’s executive vice president and chief marketing officer. He pioneered the creation of EmployeeScreen University, the #1 educational resource on employment background checks for human resources, security and risk management professionals. A recognized industry expert, Nick is a frequent author, presenter and contributor to the news media. Nick is also a licensed private investigator in the states of Ohio and Texas.
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