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Colorado bill limiting use of credit checks in employment passes second reading

Feb. 13, 2008--Denver Post consumer affairs reporter David Migoya.   The Denver Post, Glenn Asakawa
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State senators today gave partisan support — and dissent — in an hour-long debate over a bill to restrict Colorado businesses from using credit histories to screen job applicants.

The measure, SB-3, passed on a voice vote that sends it to a final reading before the Senate and then, if passed, to the House.

Expected to run along party lines in the Democrat-controlled Senate, it appears the bill sponsored by Sen. Morgan Carroll, D-Aurora, will pass, though there’s little guarantee the Republican-controlled House will agree.

Today’s vote came after a number of Republican senators slammed the measure as government needlessly poking its nose into private business, as much as its supporters proffered it as a way of getting Coloradoans back to work.

“This is not a jobs bill, but a burden on business, of not giving them the opportunity to hire the right person for the right job,” Sen. Scott Renfroe, R-Greeley, said. “In turn, you might hire someone who is not effective and you’re firing within two months instead of getting it right the first time.”

Pointing to a number of studies that suggest no correlation between credit histories and job performance — and that credit reports often have inaccuracies that could hurt job prospects — Carroll’s most pointed argument came when she challenged colleagues to undergo a similar screening.

“Can I get permission from all the legislators here to pull their credit history so that their constituents can decide if they’re good enough to represent them?” Carroll said.

The bill aims to limit the use of credit histories — not credit scores, which employers are prohibited from acquiring — in employment screening to only those jobs relevant to the background, such as financial positions that handle a lot of money.

Companies required to do the checks for federal contracts would be exempt.

Several business groups including chambers of commerce spoke against the bill in committee hearings last week, most saying it would needlessly restrict a useful tool in making sound hires.

David Migoya: 303-954-1506 or dmigoya@denverpost.com

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