This weeek, a student in my nonprofit financial management class questioned the ethics of conducting credit checks on potential employees. The students in my class are social workers, and I'm finding that their code of ethics (http://www.socialworkers.org/pubs/code/code.asp) can be quite different than the code of ethics I live under as a CPA (http://www.aicpa.org/about/code/index.html) and business ethics in general. But as we know, in some cases, business ethics have gotten corporations into a l-o-o-o-o-o-o-o-o-o-t of trouble.
The student argued that prying into someone's personal financial affairs and making a judgment about her ability to do a job, even a finance or money-handling job, is not in alignment with the basic social-work value of respect for another human being. She gave good examples of how this protocol could be misused and abused. I can definitely see her point, but I don't want to be the nonprofit leader who has to explain how $50,000 was embezzled by an employee I didn't do a background and credit check on.
I'd love to hear your perspective on this issue!
4 comments:
I worked at a nonprofit that did background checks and someone still was able to embezzle hundreds of thousands! And she had stolen at her last job and it had been hushed up. This time though she had to do jail time, so hopefully, future employers will know what they're dealing with. I say all that to say background checks aren't full-proof either.
I understand both sides of this argument. On one hand, companies need to minimize risk, but on the other, the way people deal with their personal finances may not have any bearing on how they conduct themselves in the workplace. An important question is, where do they draw the line? If a candidate for employment holds all the skills and experience a company is looking for but has a large amount of debt, do you pass them over for someone less qualified but more financially stable? Perhaps the person with a lot of debt or poor credit had a medical emergency and was unable to pay for treatment. Is it then unethical to ask them about their credit to clarify the issues?
I too worked for a company that completed extensive background and credit checks during their hiring process. They were ripped off to the tune of $15,000 worth of merchandise. Apparently this system is somewhat lacking in its ability to catch less-than-scrupulous characters.
I think it should be good enough to do a criminal background check during pre-employment screening. And buy some decent insurance to help abate the cost of thieving employees.
Another blog reader emailed me and said that her credit had been adversely affected by hospital bills and that someone she had worked with had embezzled despite the credit check. Obviously, it's not a panacea, but it's difficult to quantify the wrongdoing that's been avoided by using the credit check as a preventive measure...
I think credit checks should be reserved for financial institutions granting new credit. Not for insurance companies or employers or anyone else. What do we have left that's private in this country? Anyway, people with bad credit are not by definition morally challenged. That's just wrong.
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