Should your bosses get to look at your credit score?

Employers have been using credit reports as one way to evaluate potential employees for years. But the recession-that-won't-end is effing up thousands of people's scores, so now some states and Congress are thinking about banning the practice, according to this Wall Street Journal piece.

I think banning the use of credit reports in most (but not all) hiring is a good thing: anyone can be a good employee and have financial trouble along the way. For most of us, it'd only take one emergency or a couple months of unemployment to ruin a good credit report. Companies argue that the credit score is a good predictor of potential problem behavior with employees but I don't see how that argument carries weight in an era where all manner of personal information is available with a quick Google search, and criminal background checks are cheap and easy to conduct.

But I'm cynical: what took legislators so long to wake up to the fact that this is a problem? It seems to me that the only reason they're taking on this issue now is that it's affecting people more in the economic "mainstream" (read: middle class whites) who have been hurt by the recession. Poor people and minorities, especially blacks and Hispanics, have had their economic prospects hurt for years by this and other practices which unfairly and disproportionately impact their job prospects (see: using credit scores to determine insurance rates). It makes no sense to use credit reports to bar people from getting jobs when getting a good job in the first place can help improve the score.

It's amazing how something that's been harmful to a great number of people for a long time is ignored by politicians and regulators until it starts hitting their poll numbers. Then what's been a bona fide crisis for years becomes an official one and finally there's debate, if not action.