Using Pre-Employment Credit Checks in Your Employee Screening Process
A PEER report is the term used for a Pre-Employment Credit Check. These reports are procured from the major credit reporting agencies and offer insight into the financial history of a potential employee.
When a PEER report is included in an employment background check, the candidate must agree to have their credit history released to the employer. What the employer receives is a report on the candidate that details their credit history, payment history and outstanding loans of various natures.
Employee credit checks can give a large view of the employee’s financial responsibility, but are not necessary for every employer to implement. Due to the personal- and often irrelevant - nature of the information obtained, accessing this information without reasonable cause could be seen as an unnecessary invasion of privacy on the part of the employer.
However, there are certain positions and industries that benefit from running credit checks as part of their employee screening process. Executive positions and positions that deal with company finances are more likely to require an employment background check with a credit screening component. For example: when cash-handling is part of a job’s duties, it is wise to know of any large outstanding debts the candidate may owe. If a candidate turns out to have debt that exceeds their potential earnings, that candidate’s background could be taken into account as a potential risk.
For more information about comprehensive employee screening and employee credit checks, contact Employer’s Reference Source. See how your hiring process could benefit from customized and comprehensive screening.
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