Rep. Yanez: “Don’t Use Credit History to Deny a Worker a Job”

LANSING – State Representative Henry Yanez (D-Sterling Heights) introduced legislation today to create the “Job Applicant Credit Privacy Act.” The bill would prohibit an employer from making employment decisions based upon an individual’s credit history. The bill does not, however, prevent an employer from inquiring about an individual’s credit history if it is relevant to a particular position, such as a position in a financial institution. 

“A person’s credit history does not predict how they will perform on the job, and there are far more reliable sources – such as personal references and past employers – to determine if a person is a good fit for a particular job,” said Yanez. “Unless a person is applying for a position in finance, we shouldn’t be looking at their finances and denying them a job because they may have found themselves in financial difficulties.”

Yanez’s bill prohibits an employer from inquiring about a job applicant’s credit history and disenables them from refusing to hire or recruit a person based on their credit history. It also prohibits an employer from disciplining or discriminating against a person concerning employment or wages because of their credit history. Employers that perform credit checks are putting Michigan workers in a Catch-22 situation: many job seekers are behind on their bills because they don’t have a job, but they can’t get a job because they are behind on their bills and that affects their credit history. 

“Many people who struggled in the Great Recession and lost their jobs are still trying to get back on their feet and reestablish their credit,” said Yanez. “A credit history is more properly used to determine someone’s fitness for a loan and not a job. Many good, responsible workers have found themselves denied a loan for a variety of reasons, but that doesn’t affect their ability to do their job. We need to help struggling individuals reenter the workforce instead of throwing more barriers in their way. My bill will provide them the protections they need to help them find work.”