Are credit checks a helpful hiring tool?

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The debt effect 

The anonymous jobseeker was offered a conditional insurance advisor position only to have it retracted weeks later when his unfavourable credit report was revealed.

After being out of work since August, he’s fallen behind on some bill payments, has approximately $14,000 in debt plus a mortgage and car loan – but being passed over because of his financial history is only going to create a catch-22 situation, says one expert.

“There’s a certain irony that the people who are most vulnerable and who most require access to jobs could be discriminated against because they have poor credit ratings,” said Murray Rowe Jr., president of credit advisory group, Forrest Green.

“I think it's important we understand that the ramifications of leveraging credit bureau data are quite profound,” he warned.

Data discrimination 

The rejected Ontario jobseeker told Huffington Post Canada that the practice felt more like discrimination than savvy candidate screening.

“They rejected me solely based on whatever my credit check came back as,” he said. “It just seems absurd to me. I have no criminal record, no history to suggest I am a bad person, just a credit score reflective of poor economic times. In my opinion, it seems like discrimination.”

It may feel unfair to him but, according to employment lawyer Daniel Chodos, until Ontario’s Human Rights Code explicitly protects discrimination on the basis of economic status, any legal claims from the jilted jobseeker would hold very little weight.

What do you think? Should HR take a candidates credit check into account or is it an unfair assessment of their character? Share your thoughts below. 

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