Some pieces of financial information are public knowledge while others are not. This is why there exist credit check services for employers. They can use these services to access a candidate’s financial data. Check out this explanation concerning why employers are so interested in an individual’s financial background.
Prevent Criminal Activity
Many hiring managers want to recruit people who are not likely to commit criminal acts. If they view a candidate’s financial information, such as their bankruptcies, foreclosures, and at-risk assets, and determine that they are experiencing financial difficulties, they may be hesitant to push his or her application forward out of fear that, if they hire that individual, he or she will engage in criminal activity, such as embezzlement, out of desperation.
Assess a Candidate’s Reliability
Employers want workers who are reliable. They can measure the reliability of an individual by looking at their financial records. For instance, if they uncover that an applicant has had several evictions in the past few years, they will likely eliminate that person from the pool of candidates. They would do this because their financial background suggests that he or she experiences problems maintaining contractual agreements.
Improve Their Financial Status
Many companies have open positions in their finance and accounting departments, so they do their best to look for and hire individuals who are good at handling money. If a background check reveals that a particular applicant has an exceptional financial history, including a positive credit report and a list of high-value assets, employers will be more than happy to promote that candidate to the next stage of the hiring process; that individual’s financial history suggests that he or she will be able to advance or protect the finances of the company.
There do exist laws concerning how employers can use a person’s financial information to determine his or her ability to be hired. Companies must follow these laws or risk litigation.