An Employment Credit Score is a pioneering concept from Smart Credit.  It is a score for individuals to understand how employers may judge them based upon their credit report.

Because your credit report is being used by 50% of employers to determine hiring, firing or promotion we felt it was important to create a new score that considered factors an employer may use.

Our Employment Score is determined by your credit report.  It weighs certain factors more, or less, depending on how an employer may look at your credit report.  Remember, employers cannot see your credit score.  This means factors on your credit report are manually reviewed and determined differently for a job or promotion than for a loan or line of credit, which is almost exclusive credit score based.

Your Employment Score range is between 350 and 850:

The Employment Score is calculated from lots of different credit data in your credit report. The percentages below reflect how important each category is to your Employment Score.

As you can see, the last 12 months is very important to an employer.  Paying your bills on time, low financial stress and avoiding tax liens or collection accounts demonstrates good healthy behavior on your part.  This is important to employers who are looking to judge your character.

Compare that to how standard credit scores are calculated, including the FICO credit score:

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How your credit can get you hired, fired and stop a promotion. Part iv of iv: Getting fired because your credit changes during employment.

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As we have learned in part iii, the job applicant’s death spiral, your credit can derail your prospects for a job or promotion.

Now we’ll explore how your credit can possibly get you fired.

Checking credit during employment is a new trend. Employers have started using your credit to monitor on-going behavior while you are employed.  Many employment contracts now include your permission to check your credit twice a year or whenever determined necessary.

The need for this does have relevance if you have a sensitive job, high security clearance or handle the identity of others.

Why is checking an employees credit a growing habit beyond the obvious need?

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How your credit can get you hired, fired, and even stop a promotion. Part iii of iv: The job applicant’s death spiral.

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It starts with someone who is unemployed and searching for a job. Then, one of the two following factors is needed to create a job applicant’s death spiral:

1) Your credit is negatively affected by errors or identity theft; or,

2) You have used up your savings and can’t pay your bills on time, negatively affecting your credit.
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How your credit can get you hired, fired, and even stop a promotion. Part ii of iv: Why your credit report can stop you from getting the job or promotion.

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To understand why bad credit can stop you from getting a job or promotion, let’s first understand that good or great credit will only bring you to neutral in an employers hiring decision.

In part i, we learned most employers are not qualified to review your credit report.  Additionally, most do not know the difference between good or great credit by looking at a credit report, which has no negatives items (remember: employers cannot see your credit score, only your credit report).  It is true that good or great credit will give you an advantage over other applicants with bad credit.  On the other hand, do not count on good or great credit to be anything more than judging you as one with normal credit.

To help you prepare for an interview, let’s examine how employers interpret your credit report.  If necessary, review part i again, to see what employers are looking for on your credit report.

If the employer interprets your credit report as Below Normal or worse, your chances of getting the job or promotion become slim.

What can you do?

Understand your credit well and be prepared for an interview.  Part of being prepared is making sure your credit is the best it should be.  Be proactive and use SmartCredit.com Our Smart Action buttons work quickly to fix errors, get goodwill corrections of negatives and settle debts to help your overall credit.

Coming soon:

Part iii – The job applicants’ death spiral.

Part iv – Getting fired because your credit changes during employment.

David B. Coulter – founder and C.E.O. of Smart Credit

How your credit can get you hired, fired, and even stop a promotion. Part i of iv: Why employers check your credit report.

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You may be shocked to learn that your credit is playing an ever increasing role in employment.  Your credit report is used, in part, to determine if you are worth hiring.

In many cases, when you apply for a job, you are agreeing to a background check which includes your credit report.  The Fair Credit Reporting Act allows employers to do this.

This is a recent trend.  It got traction in 2001 and now nearly 50% of employers are using credit report data to help determine who they should hire or promote.

Why would your credit report matter to a potential employer if you have the talent, education and experience for the job position?

It’s because the resume is too easy to fake and too hard to verify.  Additionally, checking references and specific items on your resume may take too long and cost too much.  Something else needs close attention and there is little else beyond your resume, criminal background check and your credit report.

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