Bills would restrict employee background checks

With nearly 170,000 Connecticut residents struggling to find employment, a state legislative panel has endorsed new restrictions on when businesses can research individuals’ credit and criminal backgrounds.

“Nearly half of the employers in this country go into workers’ credit history during the hiring process,” said Rep. Matthew Lesser, D-Middletown, co-sponsor of the bill restricting credit background checks. “In a different time that might be OK. But in this economy, a lot of people have credit problems.”

Unfortunately, Lesser added, too many Connecticut residents also are out of work. The state unemployment rate stands at 8.9 percent, with an estimated 167,900 residents seeking work, according to the state Labor Department.

Lesser’s bill would allow credit checks on applicants seeking business managerial posts, or for  positions with authority to execute contracts or issue payments on behalf of a company, but would ban them in other instances.

The House of Representatives adopted a similar bill last year but it died on the Senate calendar. Lesser said he hopes the exemptions included this year, and Connecticut’s prolonged economic slump, will convince lawmakers in both chambers to support it.

“There is no evidence that there is any correlation between your credit history and your job performance,” Lesser added. “And I think people realize we are one more year into the recession. It’s hard enough to get a job as it is, and this is just another barrier for a huge number of middle-class workers.

A second measure would prohibit employers in the food service and retail industries from denying an employee a promotion solely on the basis of a worker’s previous criminal record. Both bills have been approved by the Labor and Public Employees Committee and are now before the Judiciary Committee.

Sen. Edith G. Prague, D-Columbia, and Rep. Kevin Ryan, D-Montville, co-chairmen of the labor committee, said the criminal records bill stemmed from a recent complaint raised by a worker in a Hartford business, but the legislators declined to name the employee or company.

“People make mistakes and go to jail,” Prague said. “But if they do their time and if they come out and become productive members of society, this shouldn’t be held against them. If they meet every other qualification for a promotion this should not be an obstacle.”

Ryan added that “I really don’t see why (background checks) are necessary” in most instances.

But Timothy G. Phelan, president of the Connecticut Retail Merchants Association, said prohibiting the background checks would remove an important screening tool from the business community.

“Just because someone has a bad credit history doesn’t automatically mean he isn’t going to get a job,” said Phelan, whose association represents about 2,000 stores and three of Connecticut’s credit history reporting agencies. “But shouldn’t businesses be allowed to fully vet these applications?”

Phelan added that credit and other background checks are only one component of an overall review process before an individual is hired or promoted, but they usually are not the sole determining factor.

Finding work in this economy is difficult, but that doesn’t change the fact that many businesses place employees in positions of fiscal trust, whether they are managing major investments or simply operating a cash register, said Sen. Tony Guglielmo of Stafford, the ranking Republican senator on the labor committee. It is reasonable, he added, that companies would want to know if potential employees are in financial difficulty.