On the heels of a new report backing the idea, State Senator Mike Barrett, D-Lexington, has refiled his bill to prevent employers from running credit checks on job applicants. Crittenton Women’s Union (CWU), which authored the year-long study, named Barrett’s legislation as a top way to stop the cycle of poverty associated with severe debt.
CWU — a group that advocates for low-income women — said in its report that the practice of employers checking credit scores of job applicants “is not a proven indicator for future job success” and one that “places undue hardship on low-income job seekers.”
“This idea is gaining serious momentum,” Barrett said. “Ten other states have passed bills restricting this practice. Massachusetts should be next.” He directed praise at U.S. Sen. Elizabeth Warren, who is leading the charge on the federal level.
Barrett’s bill prevents employers from using credit reports for hiring purposes or from asking an applicant about his or her credit standing, except when federal or state law requires it.
The practice of checking a job applicant’s credit report when making hiring decisions creates a vicious cycle, according to Barrett. Jobseekers — who often have low scores due to unavoidable life circumstances — may not get hired because of bad credit; without regular income their credit reports will likely suffer more. According to the National Employment Law Project, Massachusetts had 78,800 workers unemployed for 27 weeks or longer, on average, between September 2013 and September 2014.
Joan Cirillo, President and CEO of Operation A.B.L.E., a group that helps the long-term unemployed get back to work, said that Barrett’s bill would help. “It doesn’t take a rocket scientist to realize that if you are out of work for many months, you are going to purchase things on credit,” she said in a recent editorial. “However, in so many companies, credit scores are used to make hiring decisions even though they don’t predict job performance.”
Barrett’s bill, S123 “An Act regulating the use of credit reports by employers”, has been sent to the Joint Committee on Consumer Protection and Professional Licensure, where it awaits a public hearing.