Brian O'Connor

Employers myth out on credit scores

Urban myths are those things that never really occurred but that "everybody knows" exist.

Usually they're laughably tall tales of alligators in sewers, rats mistaken for chihuahuas, Britney Spears wearing underwear and even a winning U-M football season.

Now I've got one to add: That your prospective employer checks out your credit score.

Credit scores rapidly are becoming one of the most important numbers in America today, falling somewhere in life's numerical pecking order between your IQ results, SAT score and the phone number of that crazy ex-girlfriend that keeps popping up on your Caller ID.

Credit scores off-limits

These days it's not only lenders who use credit scores in their decision-making. The list of people dialing up those three vital digits now includes insurance companies and many landlords.

But not your next boss.

"We do not score for employment reports," says Maxine Sweet, a spokeswoman for the Experian credit bureau. "If you chose to do that, I think you would be breaking the law."

Employers can get limited credit reports on prospective employees, but they don't include lots of stuff found on a full credit history. They don't include your birth date or any information on joint accounts with a spouse, because that information could be used to discriminate in hiring. They also don't include your credit account numbers, to protect against fraud and ID theft.

And they don't include any kind of credit score.

"Credit scores don't help employers make smarter employment decisions," says Craig Watts, a spokesman for Fair Isaac Corp., the Minneapolis firm that invented the credit score. "They are for judging credit risk."

Visa's bum press release

So why did the good folks at Visa USA put out a press release headlined, "Americans Unaware That Employers Can Legally Refuse to Hire Job Applicants with Low Credit Scores?" Besides not knowing how to write a short headline, do they also not know that scores aren't included on reports to employers?

"We don't have figures on whether that's true or not, but anecdotally it seems that more and more employers are doing it," says Jason Alderman, Visa's director of financial education.

Look, there's plenty to worry about in getting a new job: Are my shoes shined? Is my resume correct? Is the right answer to "Where do you see yourself in five years?" to simply scream, "Employed!" So any job-hunters out there can stop worrying about whether last month's late utility bill will keep you out of work.

And if the friend of your cousin's who always passes on these urban myths tells you employers will judge you by your credit score, just throw him in the sewer. I'm sure the alligators will handle the rest.

You can reach Brian O'Connor at (313) 222-2145 or boconnor@detnews.com.