BOSTON – Senator Michael O. Moore (D-Millbury) announced that the State Senate unanimously approved a bill to restrict the use of credit reports in hiring and promotions. The original bill was co-sponsored by twenty legislators including Senator Moore.
According to the Institute for College Access and Success, the average educational debt of a four-year college graduate in Massachusetts is $29,300. Moreover, a survey by Blue Cross Blue Shield found that nearly one in five insured adults in Massachusetts struggled with paying medical bills in 2015.
“As our economy continues to recover from the Great Recession, this legislation is yet another step forward in helping to remove barriers for job seekers,” said Senator Moore. “There is no research to show a statistical correlation between credit scores and job performance. It is my hope that this legislation will reach the Governor’s desk during the current legislative session.”
The legislation bars most employers from using credit reports for hiring purposes. The bill does, however, provide exemptions for jobs that require credit checks under federal or state law; high-level positions at financial institutions; jobs that require national security clearance; and jobs with authority over funds of more than $6,000.
Nationally, 47% of employers use credit checks to evaluate job applicants. Recent studies, including an eight-year study by the Federal Trade Commission (FTC), show that credit reports are often riddled with errors. The FTC study found that 25% of consumers spotted mistakes in their records.
The legislation will now go before the House of Representatives for consideration.