A controversial law in Colorado that would prevent employers from running checks on potential employees’ credit reports recently passed the state’s Senate.
Colorado Senate Bill 3, which is sponsored by Democratic state senator Morgan Carroll of Aurora, would prevent most companies from running credit checks during the hiring process, but has certain allowances built in for specific industries, according to a report from the Denver Business Journal. Under the provisions of the law, defense and security contractors, as well as financial institutions, would still be able to run credit checks on their applicants.
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Proponents of the bill say that because of the recent financial problems suffered by many in the Rocky Mountain State and across the country, the practice of checking credit reports may not be the fairest way to judge an applicant, the report said. This is particularly true due to the previously high unemployment rate, which may have, through no fault of their own, prevented consumers from being as responsible as they might have been in the past.
“In a different time, I probably wouldn’t be supporting this bill. But I do think it’s a different time,” Sen. Rollie Heath, a democrat from Boulder, told the news site. “At this point in time, the balance weighs in favor of those people who are out of work and are in jeopardy of not being able to get a job.”
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Republicans, meanwhile, say the law effectively makes it harder for employers to make more informed decisions about applicants for open positions, and others have expressed concern over the industries exempted by the bill, the report said. Some also said that the bill may not be a good idea because it essentially does nothing to create new jobs.
All 20 of Colorado’s Senate Democrats voted for the bill, and all 15 of its Republicans voted against it, the report said. With the proposal having passed the Senate, it now moves onto the Republican-controlled House, where its ability to pass is unclear.
Experts and consumer advocates alike have said that the practice of ordering a potential employee’s credit report may be unfair to the applicant in most cases because it may not reveal anything about their character or how trustworthy they are, especially given the state of the economy in the last few years. A number of states already outlaw this practice.
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