I once applied for a job with a big-time, international consulting firm. I signed off on a background check that included letting them interview everyone back to my kindergarten teacher. I had to get a physical and pee in a cup. They did a credit check. Who knows what they found, because they didn’t hire me. (I have no idea what they found because they wouldn’t share it with me.)

That was lucky, because letting people I didn’t know intrude into areas of my life that were none of their business gnawed at me… and I decided not to accept an offer even if they made it. Go suck rocks. Who wants to turn their life over to goons? And besides, I wanted to know — but no one at the company would tell me — what does the CEO’s credit record look like? Why don’t employers publish their officers’ full records like Subway publishes calorie counts on all its sandwiches?

Why do companies want to know it all? To avoid hiring someone who might go postal some day? Nah, it’s to cover their asses. Personnel jockeys and lawyers apply every available “verification” process just because they can. Because who wants to make a decision and be held accountable for it if there’s one more source of data we can check…? Who wants to hire somebody who missed her last car payment and is struggling to find a job so she can make the next one?

What many people don’t realize is, you can say NO. You are under no obligation to micturate on demand, expose your kindergarten teacher to embarrassing questions, or to take a probe up your credit report or up your ass. You might not get the interview, but all the details of your life are not any employer’s business unless you choose to make them so. (If you consent, consider that what an employer finds may not even be accurate. The U.S. Public Interest Research Group says that about a third of credit reports contain serious errors.)

Many Ask The Headhunter readers tell me they say NO. I learned to say no after I looked at myself in the mirror following the investigation into my life many years ago. I was ashamed of myself. I gave up everything about myself to information goons.

On July 9, 2009 Congressman Steve Cohen of Tennessee introduced H.R.3149, a bill “to amend the Fair Credit Reporting Act to prohibit the use of consumer credit checks against prospective and current employees for the purposes of making adverse employment decisions.”

Cohen says, “At a time when people are struggling to find jobs, credit checks should not be used as a basis to deny employment to otherwise qualified candidates.” The bill has 36 co-sponsors and it is long overdue. It’s time to draw this line.

Nonetheless, the bill “makes exceptions to such prohibition for employment: (1) which requires a national security or Federal Deposit Insurance Corporation (FDIC) clearance; (2) with a state or local government agency which otherwise requires use of a consumer report; or (3) in a supervisory, managerial, professional, or executive position at a financial institution.

You should be aware of these exceptions because this is the best we’re likely to get. Much as I would like to put kindergarten teachers off limits.

Checking people out before you hire them is a smart thing to do. So talk to people that job candidates have worked with and ask smart questions. Check references. Do your diligence. But you’re not an information proctologist. There are places where your hands don’t belong because you don’t acquire rights to anyone’s privacy when you hire them. And it’s time Congress put that in writing.

Kudos to Rep. Steve Cohen. H.R. 3149 has been referred to the House Committee on Financial Services. I’m contacting my legislators and telling them to vote for the bill. I encourage you to do the same.


  1. Hi Nick

    I’m with you on this one but, as a current job-seeker, do I have much of a choice? I mean, for every one guy out there who says no to the credit check/urine test, I’m sure there are literally 100s more willing to submit themselves to these buffoons!

    I am in the UK and I’m not sure if your strategy will work here. It would be considered an act of defiance and would not go down will with management or the goons in HR. It is pretty much mandatory (though not in law) to conduct a credit and health check if you work in financial services (which I do). I have no objection to a criminal record check but I too am uncomfortable with the brazen invasions on privacy we have to put up with as job seekers/employees.

    Is this a realistic line to take in such a terrible economy? Again, I think that your advice makes great sense but is it practical? Any advice/insight from you would be greatly appreciated.

    London, UK

  2. The defiance may get some interesting reactions that while they probably won’t go well, you never know when you’ll find that manager or HR person that goes, “Wow! You have guts to stand up to us. We like that,” as there may be a few of those out there.

    Isn’t it sad that companies will do so much digging around on a perspective employee but then once you are hired, this kind of thing just goes away. I would hope that Employee Relationship Management becomes a big trend in HR but I’m not holding my breath about it.

    You do have a choice. For those wondering how I’d show this, consider some of the most disgusting and gruesome jobs that I’m not sure a lot of people would like to do, like those on the “10 Dirtiest Jobs” on Discovery. While sometimes one has to take a crappy job, you should remember to have principles and stick with them. Sometimes these people are rare, who aren’t prepared to do almost anything for a buck.

  3. @John: I’m not telling anyone what to do or what risks to take. I’m just telling you that out of pernicious behavior have arisen complaints that have spurred legislative action. A lot of people already said NO. They made a choice, some of them took a risk, and now the law may change as a consequence.

    As I mentioned, Ask The Headhunter readers periodically tell me they walk away from companies that want waivers of liability from doing deep investigative checks. They walk away from companies that insist on knowing salary history from past jobs.

    But ain’t it cool when Congress gets the message? I hope your legislators in the UK get it soon, too. This is an opportunity for you to write a letter to the editor of a major newspaper, to professional/industry publications, and to post on UK online forums – and announce what’s going in on the US. It’s a start. It’s easy to paste the link from this blog post.

    This is where change starts and insanity ends.

  4. Companies conduct background checks for a few reasons. Yes, to try to avoid hiring someone who may show up some day with an Uzi. Drugs tests are obvious. But, if someone works in a fiduciary capacity and has access to a company’s $$, then they need to make sure there are no fraud or other incidents in a person’s past. Credit would apply apply, but these days defaults & such may be overlooked to a certain degree. Everyone has a right to refuse to allow a company to get this information — but it means you will not get hired. Period.

  5. @Lorraine: **but it means you will not get hired. Period.**

    Sorry, I don’t buy the “Period” part. That means a company that has found a candidate it really wants will always decline to hire because of an HR policy. I’ve had clients waive all sorts of policies to make a hire when they want to do it.

    What happened to the great corporate claim that, “We value poeple who think out of the box!” Except our HR department.

    And I don’t buy the argument that a credit check is necessary to identify fraud in someone’s background. A request for permission to do a criminal check would reveal that. Credit check is not necessary.

    I have no problem with a company asking permission to do a criminal record review – if you broke the law and got convicted, you need to explain and should have a chance to. Being late on credit payments is not illegal. It’s no one’s business. Including a company where the job involves fiduciary responsibility. There is no clear connection between one’s credit history and how they would handle a company’s money. (If there is a fraud conviction, that’s different.)

    Suppose a person is behind on mortgage payments because they’re unemployed. They need a job to make the payments. A company rejects them without explanation, which is the usual course.

    The explanation that companies “overlook” certain things is bunk. What do they overlook? They are not required to divulge their decision process. It’s not reasonable to demand the right to judge, but to avoid the responsibility to explain and justify the judgment.

    Sorry, I don’t buy it. This is like suggesting that a person who has been divorced 3 times should not be permitted to work as a marriage counselor. I happen to know a guy who fits that description. He’s a great counselor. Lousy marriage partner.

    What is wrong here is blind adherence to “policy” simply because “it’s there” and because “it means you will not get hired. Period.”

    I say bunk. That’s wrong. Mainly because the job applicant has no recourse, is usually never shown the results of a credit (or drug) check and cannot defend themselves. Add up the false-positive rates of drug and credit checks, and the problem is clear.

    HR has a problem that job applicants wind up eating.

  6. I am glad you wrote about this subject because I was concerned about how my own credit history might effect my chances for success in the job search. I have had to read hundreds of credit reports and there is no indication that credit determines good work habits. I’ve seen 18 yrs with 800 beacon scores and no account history. And I’ve seen folks credit reports severally effected by divorce, family members, fraud, etc. Another aspect that really concerns me…is who is going to be reviewing my credit? Are they qualified to read it correctly? Besides, I’m not asking to borrow money for the company…rather, I will be working for them.

  7. I would simply tell anyone asking for 98% of this to find someone else, and I’d walk out. This has gotten entirely out of control, because people are too weak to simply say no. These invasions are not appropriate, and should never be tolerated. Frankly, take a look around some of these companies today, and compare their employees to those of years ago when this crap did not take place. Is this what these so called idiotic screenings have resulted in hiring? I rest my case.

  8. Those checks are shoddily done. My ex-husband was offered a job at a place I used to work and after the offer was made, he went through a background check and was sent a letter of rejection with no reason given for failing the check.

    Because I knew the people responsible for the background checks, I called to find out why they rejected him. I was told he was not being hired because of his “criminal record” in a state almost 3000 miles away (a state he had never been to). I did a quickie online investigation on his name and discovered there was someone else with his same name and same birthday who had been convicted of several serious crimes. My company did not believe me or want to do anything when I told them; I had to pull rank and insist on them investigating further before they learned that it was a different guy.

    Moral of this story: If you decide to submit to a background check, do a background check on yourself first to be prepared for anything like this. As a hiring manager, before this I had accepted as valid if someone was rejected because of a background check. After this, I always made sure to verify that the rejection was correct. But my ex, the would-be employee, would have had no recourse. He was not permitted to know why his offer was being rescinded, and if I hadn’t happened to work there and be a persistent nag, he would not have been hired there and maybe the same thing would have happened at other places.

  9. How can we lobby against these practices?

  10. The HR and management people of such companies should ask themselves the simple question: On which moral ground do they think they can behave like a combination of God and the KGB?

  11. @Ellen: Check the very end of my post above. Use the link to find your legislator. Send them a note with instructions.

    @Krista: I encourage you to send your story to your legislator, and to Congressman Steve Cohen. Imagine all the other “rejects” who have no idea they were “confused” with other people.

    @HR (if anyone in HR is reading this): Comments?

  12. Employer credit checks are a HUGE source of revenue for credit bureaus. Those people would sell your information to a monkey if they could get him to buy it.

    Contact your legislator. Fight back!

  13. Layne, you hit the nail on the head. Credit bureaus sell this “background check” crap to companies by scaring them into thinking they could be hiring the next Charlie Manson unless they track down whether the candidate was ever late on a credit-card payment.
    With the bogus practices of credit-card issuers, who have shortened payment periods without notifying cardholders, who HASN’T been late on a payment?
    I once emailed Nick because I was faced with the same problem — should I allow a background check for a job that had no fiduciary duties. His advice then and now was the same — do what you think is right, but be prepared not to get the job.
    I didn’t. But I don’t regret my decision. Maybe it’s time for a job-hunters revolt. Stop going along with the crap questions, the demand for salary history and credit checks. Maybe we should start saying, “Well, I will if you will. After all, as a potential employee, I have a vested interest in going over the company’s books and investigating its top managers to be sure they are responsible and trustworthy.”

  14. @Layne: Another racket is reference checking services that wil check your own references for you. Their stature goes up when they find something wrong. “Look! Lucky we checked this out for you, eh? Aren’t you glad to pay? Tell your friends!”

    Reference checks are a funny thing. It’s all in how you ask the questions. Load the questions, and you can get what you want quite a bit of the time. Those services are a racket that preys on fear.

  15. @Etta: Yah, candidates should start requesting background checks on the managers they’re considering working for… “Uh, what if she’s a psycho? I could wind up suing your company for millions. Better we should find out now… Let’s see her background check, and please throw in a psych evaluation, or I’m not interested in working here…”

    Putting the shoe on the other foot changes things.

  16. Ah, the whole process is messed up. They (employers), as you say, seek to put you through a through strip search, and yet are ready to cry Foul if you go nosing around in their business “too much.” They ding you for “lying,” and yet will lie to you straight-faced in a heartbeat (“We are THE leader in our industry!” “We’ve been growing 50% each year!” “We’ve never had a layoff!” We’ve had 15 straight profitable quarters!” “We consider our employees as family!” Yah, like the Manson family.). They make a big stink about “loyalty” (“I see you’ve jumped around a bit the last few years?”), and yet will throw you under the bus without notice, at any time (“Yes, I have jumped around a bit; care to guess why? And by the way, how many jobs have you had lately?”). Regarding the subject at hand: reference check… sure; criminal check… OK, I guess; drug test… OK, I suppose, if you must; credit check… hey, you wanna check for hemmorrhoids while you’re at it? Dental records? DNA testing? You show me your, I’ll show you mine; otherwise no deal.

  17. C’mon – be reasonable. If you were hiring someone for YOUR company, wouldn’t you be diligent in making sure the person is who he/she claims to be? Would you want to know if a person was convicted of a felony? Fake SSN? No? Then in that case I suppose your argument is valid. If, however, you want to avoid hiring wife beaters, pedophiles, or worse, then at a minimum a criminal check is in order. All a credit check will do is to help an employer determine a candidates level of financial responsibility and the POTENTIAL motivation for misuse of funds. Again, if this were your employee, would you take what he/she says at face value?

  18. Yes, I do agree I would ensure the person is who they say they are. However, credit history does not guarantee someone’s financial responsibility and/or the potential for their misuse of funds. Let’s face it…there are no guarantees in anything. Based on your rationization, employees should be able to receive without question their immediate supervisor’s criminial and credit information and the information about company. As you put it…if this were your [company], would you take what he/she says at face value? I guess this goes right back to Nick’s point about making sure we do our research too.

  19. Beyond what is advisable or permissible for a potential employer to know about you, a credit check these days reveals only if you are behind on payments for anything — NOT the reason why.
    Sub-prime mortgages, anyone? Layoff in the family? Medical bankruptcy? Pre-existing condition that boosts your medical insurance payments (if you can even qualify for coverage) sky high? Identity theft?
    Sorry Lorraine, a credit check — even IF it is accurate, which is debatable — doesn’t really provide a potential employer with truly actionable info. It just provides the easy way to “no,” leaving qualified candidates in the dust.
    It’s just another Stupid Hiring Trick.
    I once worked for a newspaper that required everyone to take what we called the “crazy test,” a word-association quiz that was supposed to cull out all the wackos.
    Gotta say, that newsroom was full of nuts and wackos anyway. (News business seems to attract ’em.)
    Any by the way, it didn’t cull out the long-term publisher, who was caught with his hand in the corporate till and summarily “retired” with two days’ notice.
    So I’m on the “can you actually DO this job” side of the interview process.

  20. I heard about this bill on Ronn Owens’ talk show, a popular host in the San Francisco Bay Area.

    Callers were both job seekers and employers. Some of the highlights included:
    * candidates with problematic credit really wanted to improve it yet couldn’t land the next job because of it
    * employers who said even though they did them, it didn’t prevent problems from happening (and some were caused by those with the most exemplary credit!)

    I hope the bill passes. I’d rejoice, especially if it deals a significant blow to the Behavioralists.

  21. Nick,

    The credit check is nothing compared where the mining of information is going. Using ZIP Code, age and gender there are algorithms that, with 85% reliability, identify you by name.

    Ian Ayres in his book SuperCrunchers describes a future of predictive modeling that will through the manipulation of data predict future employee outcome. Think of a world where you will be turned down for a job because some model will predict what you, as an employee, MIGHT do and not getting an offer because of that. Nothing even as engaging as a drug screen or credit check, merely a stochastic process and analysis.

    Credit checks are childs play compared to this future. It will all be in the numbers. Talk about a moral dilemma!

  22. This to me is all about people fuelling their new crackpot ideas for business modelling and human resources; and in my view, it is all lunacy. What does this really mean? The quality of employee has declined drastically over the past 20 years. Does this mean a further dumbing down? Soon it will go full circle, and none of it will matter. If more and more people rejected this crap, it would not continue. Too many people are ready, willing and able to kiss up to whatever an interviewer is requesting of them, so who really is to blame for these crackpot theories escalating?

  23. I agree with your comments. Not certain it is totally crackpot but certainly misguided. Check out http://intel.mercyhurst.edu/. The methods used in the intelligence community to look for bad guys has bleed over to target marketing (or vice versa, not sure). How far off will candidate screening be?

  24. The ugly truth is that HR doesn’t even know why they request this information. They only know what they have been told and sold.

    I have always felt that this practice was a thinly disguised (and legal!) way to discriminate against minorities whose credit scores are systematically lower than middle class white applicants. It is only now that white middle class workers have been displaced that I am hearing any protest.

  25. @Suzanne: You’re bringing up the dirty little secret that many in HR will not discuss.

  26. Yes, and I am grateful for the opportunity to get it off my chest.

    Ironic, HR has no problem hiding behind legal liability to justify their existence, but that doesn’t count when it comes to their own questionable practices.

  27. *rubs hands together*

    going on an interview tomorrow with a temp agency, and tempted to turn the tables on them and ask incredibly invasive/nosy/irrelevant questions. I truly have nothing to lose!

    On a serious note, it’s all a joke. That is my attitude going into these places–“do you want me or not?” I KNOW most of the work they offer is more suited to a monkey’s behind, but I’ll play the game for a bit, then show my true hand.

    Hope to report back later in the week.

    (*BTW, I recommend others do this, as well..It’s an interesting social experiment, a la “Office Space”–feign disinterest, having someplace to be, etc. When you don’t have the air of desperation, it is really interesting how employers can suddenly want to call you back–OR EVEN HIRE YOU.)

    Anyway, it all comes down to what Nick said, “This is where change starts and insanity ends.” Time to flip the script. I’m not just talking about it, I’m doing it!

    P.S. I kinda do it to piss of HR, too…Hell, you waste my time, I’m gonna make you pay in some way. A lot of these places just want to collect resumes (and personal info), without a real job, or even having filled the job already. No problemo, muchacha/o. I have nothing else to do, don’t mind sitting and chatting. Gets me out of the house and around town to see different coffee shops and other fine (or not-so-fine) retail establishments. Hey, maybe on the way to your office, I’ll pass a company that I really want to work for, I’ll walk in and talk to the manager, and who knows….

    In the meantime, I work for myself, advertising my writing, cleaning, babysitting, egg-frying/etc skills. Nothing beats ca$hola.

  28. P.S. Nick, I’ll be contacting my local congresswo/men…Legislative change is long overdue. Double kudos to Mr. Cohen.

  29. Great article Suzanne. Thank you for sharing.