Labor and Public Employees Committee


Bill No.:




Vote Date:


Vote Action:

Joint Favorable Substitute

PH Date:


File No.:


Sen. Looney, 11th District


This bill increases job opportunities for individuals with some credit issues who are applying for jobs with employers who are not financial institutions.


The substitute language removed lines 32 through 48 of the original bill and inserted a civil penalty in a new subsection (d).


Frank Sykes, Legislative Analyst, African-American Affairs Commission:

Mr. Sykes testified that there is a high rate of unemployment within Connecticut's African-American community. He feels a stronger economy will be built by removing this stumbling block of credit worthiness when it comes to the hiring otherwise qualified/competent applicants.


Sen. Martin M. Looney, Majority Leader, 11th District:

Sen. Looney testified that this bill would increase employment opportunities for individuals with some credit issues at a time when the unemployment climate in the State is very difficult. He feels some job seekers are facing double jeopardy when unemployment itself created their harsh financial realities such as mortgage foreclosure. He noted that some reporting statistics were actually outdated.

Rep. Matthew Lesser, 100th District:

Rep. Lesser feels that there is no evidence that there is any correlation between an employee's credit score and their job performance. He feels the current recession makes it difficult enough to find jobs and people may have bad credit scores for many reasons, including medical events, student loans and/or identity theft. This bill removes a barrier to their employment. He notes there is no fiscal impact.

Lori Pelletier, Secretary-Treasurer, CT AFL-CIO:

Ms. Pelletier feels that if employers are allowed to continue using credit scores in hiring decision, many hard-working people will be unfairly penalized. CT's unemployment rate is at 9% and may have been unemployed for more than 6 months and as a result, their credit history has taken a beating.

Gwen Mills, Unite Here, Locals 34, 335, 217 & GE SO:

Ms. Mills stated that now, when CT is in the worst economic crisis of our generation, is the time for our leaders to ensure that there is no employment discrimination. She said there is a “Catch 22” when people lose their jobs and fall behind on their bills and yet are punished further by facing the barrier of credit checks. This does not allow them to regain economic security. She also noted that this bill would discriminate against African-American and Latino applicants since their scores are 5% to 35% lower than Whites. She also said that credit histories do not predict job performances and credit histories are often inaccurate. She feels that workers in hotels, food service and other industries will not be fairly judged.

Paul Filson, Director, State Employees International Union (SEIU):

Mr. Filson testified that in these tough economic times, a person's financial hardship should not be an obstacle in obtaining gainful employment. Credit cards do not show the whole picture. He sited that a research group reported that 79% of credit reports surveyed were inaccurate. He feels this is an unfair way of screening candidates/applicants.

Cheri Bragg, Coordinator, Keep The Promise Coalition:

Ms. Bragg's testimony revolves around persons with mental illness. She feels this bill would increase job opportunities of individuals with some credit issues due to lengthily or frequent hospitalizations, for example, people with bipolar disorder. When someone enters a manic phase, they overspend, which is a symptom of their illness. They face enormous hurdles when trying to obtain employment because of numerous gaps in their work history, but this does not mean they would not be able to meet the job requirements. She stressed that mental illness is a biologically-based disorder that affects the brain, which is an organ of the body. It is NOT a failing of character.

Sarah Poriss, Attorney At Law:

Ms. Poriss works almost exclusively with clients who are in debt or foreclosure. She feels the use of credit reports/scores prevents applicants from obtaining employment they desperately need to save their homes and pay their bills. It is therefore unfair and unhealthy to use payment history as a qualification for employment. She noted that a recent study (Federal Trade Commission, 2008) found that between 15% and 40% of those surveyed found errors on their reports that may affect credit scores. It then follows that reports are not necessarily due to mismanagement of funds at all, yet they increase competition for the few jobs that are currently available. She said that some of her clients' scores are reduced due to no fault of their own because many banks are reducing the amount of credit they are offering because they don't have the money to lend. Credit reports/scores are not accurate indicators of work ethic and they frustrate the already financially challenged job seeker.

Robert Hiltonsmith, Policy Analyst, DEMOS:

Mr. Hiltonsmith testified that through his research of credit card debt among low and middle income households, he discovered that families with low scores were financially penalized.

This made it difficult for them to ever get out of debt. It also resulted in people being forced to pay more for basic services, such as child care, groceries, water and gas, being denied a rental apartment, being overcharged for auto or homeowner's insurance and even a job, which is the very thing they need to get out of debt! He said that credit reports/scores are often inaccurate and have no validity in predicting job performance. There is very little evidence that credit history is indicative of who can do the job better.


Dennis C. Murphy, Deputy Commissioner, Dept. Of Labor:

Commissioner Murphy said that although he understands the intent of the bill, there my be a fiscal impact on the Dept. of Labor since the bill permits an employee or perspective employee to file a complaint with them alleging a violation. At the request of either party, the Commissioner SHALL hold a hearing, which will be the assessment of a civil penalty in the amount of $300. This would impose a burden on the Department and may require additional staff.

Richard Jacob, Associate Vice President for Federal and State Relations, Yale University:

His testimony stated that in employment decisions, it is prudent and reasonable to use credit reports. He hopes the Committee will refine the legislation to balance the interests of current and prospective employees to avoid discrimination based upon their credit history with the interests of employers to maintain operation with “(A) involves a fiduciary responsibility to the employer, including but not limited to, the authority to issue payments, transfer money or enter into contracts, (B) provides an expense account, or (C) involves access to employer's non-financial assets, including, but not limited , to museum and library collections and to prescription and other pharmaceuticals.” He feels this suggested language would protect current and prospective employees while allow appropriate stewardship of valuable institutional resources.

Kia F. Murrell, Assistant Counsel, Connecticut Business and Industry Association:

Ms. Murrell testified that this bill would negatively impact CT's businesses by limiting employers' ability to fully assess the fitness of potential job candidates by narrowly prescribing the circumstances in which they may consider credit reports as a basis for employment decisions. By limiting the use of credit reports to only those criteria listed in the bill, other employers would be forced to shoulder the burden of defending against Labor Department complaints and fines at a time when there are limited resources for additional investigations. She noted that the Fair Credit Reporting Act already regulates employer background check procedures and allows applicants and employee to challenge such reports as adverse or irrelevant to employment. She feels this would be another layer of regulation for employers to contend with at a time when the priorities should be job retention and growth.

Insurance Association of Connecticut:

Testimony was submitted stating that credit reports are integral in the employment process, especially in certain positions where financial veracity is of concern. He feels that this is a valuable tool to evaluate a person's personal responsibility and organizational skills. They feel that an individual with a high debt ratio may not be the ideal candidate for having access to consumers' assets or sensitive personal information. Financial institutions are exempted in this bill and they feel that the insurance industry should be as well.

Andy Markowski, State Director, National Federation of Independent Business:

He testified that this bill would unduly suppress relevant credit record information about prospective employees. He feels the legislature is 'once again attempting to micro-manage business operations'. Without this credit information, employers are unable to act to protect their business from potential loss in hiring decisions. It is not conducive to successful operation of the free enterprise system. He cited an article in the Wall Street Journal last year (How to Avoid Hiring a Bad Egg” Feb. 10, 1010) that stated employees fraudulently writing company checks, skimming revenues and processing phony invoices were the most common schemes for business losses. He testified that the Fair Credit Reporting Act already sets standards for employment screening by requiring employers to obtain consent from a potential employee before conducting a background check. He feels the result of this bill would be counterproductive.

John Yusza, Jr., Connecticut Alarm & Systems Integrators Association:

He testified that credit/criminal checks are and should be performed to screen job applicants in the alarm industry to ensure that a candidate would not pose a threat to customers and their property/valuables. These employees often have knowledge and/or access to their customers' financial data/ personal property when they are away from home. He also stated that federal law provides protection under the Fair Credit Reporting Act. Since an applicant can receive a copy of the credit report if it is used to make an adverse employment decision, he feels sufficient protection is already in place.

Reported by: Marie Knudsen

Date: 3/10/2011