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Can I Use a Credit Report in the Hiring Process?

There are 11 states that prohibit use of credit reports or credit information in employment, both in the application process and after someone has been hired. These states are California, Colorado, Delaware, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont, and Washington.

But even in states where pulling a credit report is allowed, employers must still comply with the relevant provisions of the Fair Credit Reporting Act. These provisions include getting the applicant’s or employee’s written permission, and then – if a negative employment decision is made as a result of the findings – providing the applicant or employee with information about the company that provided the report, a statement that the credit reporting agency did not make the decision and cannot give specific reasons for it, and a notice of the applicant’s or employee’s right to dispute the report and receive a free copy of it in the next 60 days.

Content provided by TPC HR Support Center.