The Denver Broncos had to consider a lot of things before they signed quarterback Tim Tebow: they undoubtedly scrutinized his college football record, studied his ability to throw long passes, and observed how he handled himself under pressure. But one thing that probably didn’t factor into the decision was Tebow’s credit history. The Broncos likely recognized that how Tebow managed his personal finances had nothing to do with his ability to play football.
Many other Colorado employers, however, do use credit history to screen prospective employees – although research has not found it to be any more valid as a predictor of employee performance for other occupations than it is for football. And so, recognizing that employment credit checks form an unnecessary barrier to employment in her state, Colorado State Senator Morgan Carroll introduced the Employment Opportunity Act to curb their use. I had the privilege of testifying in favor of the bill this week in Denver.
I used no football analogies in my testimony. Here’s some of what I did say:
Over the past nine years, Demos has conducted extensive research on credit card debt among low- and moderate-income households. As part of this research, we have become increasingly concerned with how families are being financially penalized for being in debt, making it difficult, if not impossible, for them to ever get out of debt. The proliferation of the use of credit reports and scores in particular have resulted in families in debt being forced to pay more for basic services, such as water and gas, being denied a rental apartment, being charged more for auto or homeowners’ insurance, or, as I’ll discuss today in more detail, being denied a job – which is the very thing they need to get out of debt.
Credit checks are an unnecessary barrier to employment: by restricting their use, this legislation will help put people back to work and ensure that all job seekers have a fair shot at gainful employment.
Six out of ten American employers now look at a job applicant’s credit report when hiring for some or all positions. A brief, informal survey of job listings throughout the state of Colorado reveals that employers today are requiring credit checks for positions as diverse as maintenance work, telephone tech support, plumbing, work as a home care aide, and serving frozen yogurt.