Looking for Work - How's Your Credit History?

Hawaii is one of five states in the country challenging the use of credit checks by employers to hire and fire employees.

Rep. Marcus Oshiro has a bill going through the 2009 session, HB31, RELATING TO EMPLOYMENT PRACTICES. The bill establishes that the employer's use of credit history in hiring and termination decisions is an unlawful and discriminatory practice.

The issue was covered by USA TODAY, quoting Rep. Oshiro as a resource.

About 43% of U.S. employers check job applicants for overdue payments on anything from mortgages and rent to credit cards and student loans, according to the Society for Human Resource Management and security consultant Kroll. That's up from 36% in 2004, a Kroll survey found.

But the checks are under fire from some lawmakers who say needy and trustworthy people are being shut out of jobs — at a time when the economy is bad and hiring is severely cut back.

"It's almost like being forever sentenced to debtors' prison," said Hawaii state Rep. Marcus Oshiro, a Democrat.

Said Democratic state Rep. Matthew Lesser of Connecticut, "There's an awareness that a lot of people have bad credit for reasons that have nothing to do with their worth as an employee."

Bills by Lesser and Oshiro aim to eliminate many credit checks by requiring employers to prove they are vital to hiring. "Employers do the checks routinely without showing there's any connection to the job," said state lawmaker Michael Benjamin, a New York Democrat, whose bill would restrict credit checks.

Missouri and Texas are considering restrictions. Washington state enacted restrictions in 2007, the year Ishimaru told a government hearing that employee credit checks could violate civil rights law.