Bankruptcy and Employment Credit checks

Many out-of-work job seekers are facing a double whammy when applying for a new job: a marketplace flooded with competition for the job, and more employers doing credit checks.  Many have been unlucky enough to be out of work long enough to have missed a few bill payments, sending their credit history to a new low.  This can be a negative when a prospective employer looks at it.  So, just how bad is this problem, and what can you do about it?

According to an article by Kristen McNamara in the March 16, 2010 Wall Street Journal, about 47% of employers do credit checks.  Most of those are part of a background check for jobs having to do with "fiduciary or financial responsibility, such as accounting, budgeting or those involving cash or cfredit-card information", according to the article.

Sandy Gross of Pinetum Partners in Greenwich, Conn. is quoted in the article, encouraging applicants to give a prospective employer a heads-up as to what the employer might find on a credit report, and to explain why.  "No one likes a surprise", she says.  DO be up front about your credit problems. As a general rule, DON'T refuse to consent to the credit check, since the employer may simply assume the worst. The good news is that you'll have a lot of company.  In this economy, the credit-challenged may just outnumber those with pristine reports.

There may be help on the way.    Federal legislation has been proposed calling for a prohibition on the use of credit checks "during the hiring or firing process, with certain exceptions", according to the article. A law like that couldn't arrive too soon for many who have seen their credit hit the hardest of times.