A critical piece of legislation recently unveiled by Congressman Steve Cohen (D-TN) would essentially prevent employers from using credit reports in the background screening process, with some restrictions on the type of organization, position, and level. HR 3149, titled The Equal Employment for All Act, would basically provide a level playing field for all individuals regardless of their credit history. To summarize it even further, it prohibits the use of consumer credit checks against prospective employees for the purpose of making an adverse employment decision.

There are several different exclusions to the bill:

When a person applies for, or currently holds, employment that requires national security or FDIC clearance.

When a person applies for, or currently holds, employment with a State or local government agency which requires such a report.

When a person applies for, or currently holds, a supervisory, managerial, professional, or executive position at a financial institution.

When otherwise required by law.

The bill is designed to help those with financial hardships that have poor credit histories be eligible for jobs they would otherwise be denied due to their credit history. Although credit checks are one part of the background screening process, they have become increasingly popular over the years as people are losing their homes to foreclosure, not paying financial obligations, in addition to other financial dilemmas that affect your credit history drastically. Your credit history is your lifeline when you are trying to purchase your first home or buy a new car. Companies are looking at credit in greater detail and knowing the person has a poor credit history, may prevent them from landing a new position.

I guess the most important thing to consider if this bill gets through Congress and onto final passage is that credit reports are only part of the background screening process. The employment verification, drug screening, motor vehicle search, reference check, and more importantly, the criminal background, will remain intact. If the background investigation investigation is truly complete, meaning all the above mentioned pieces are done correctly and thoroughly, you should have really no issue in denying or accepting the applicant for the position.