Credit Card/Discrimination

[groupprez]

What is the name of your state? Indiana

My question concerns an employer's ability to hire/fire/deny promotion based on personal financial choices. Here's the situation:

I interviewed (and was subsequently hired) for a position as the Manager of Sales & Marketing. During the interview (3 months ago) I made it a clear point to discuss how the organization paid for travel. The answers were, 1) we will reimburse all business expenses after a trip with the employee putting up the money first, 2) we will grant a cash advance, and/or 3) we will pay for it on a company credit card. Sounds about average...

Here's the dilemma: My wife and I got into debt as a result of credit cards early in our marriage. We have not possessed a credit card for over 7 years and do not wish to get one. I recently planned a 4-day business trip and took the necessary steps (as outlined in policy) to request a cash advance for the trip. Upon my boss receiving my request, he ushered me into his office to discuss the trip (and more importantly the large cash advance). I briefly explained my PERSONAL situation and then he went on to say, "Wow, we should have talked about this in the interview" and "Will you apply for a credit card now?"

While there has not been any negative repercussion, I definitely feel the negative vibes. I want to ensure that if this situation starts to turn the wrong way, I have a leg to stand on. So, can an employer make it mandatory for an employee to possess a PERSONAL line of credit in order to carry out the duties of his/her job (as required/requested by the employer)?

I don't mind the travel even though it is a personal sacrifice. However, can an employer legally make it an issue for an employee to take on credit? This puzzles me and I would like to hear from someone with knowledge in this area.

Thank you.

 

[Beth3]

"So, can an employer make it mandatory for an employee to possess a PERSONAL line of credit in order to carry out the duties of his/her job (as required/requested by the employer)? " Yes.

Many employers do not like to provide cash advances, especially large cash advances, to employees. On the whole, it's just not a very sound business practice and can lead to problems. For similar reasons, many employers do not wish to provide company credit cards.

If they prefer to reimburse you for your business expenses, then that's their option. If you do not wish to get a credit card, then your other option is to lay out the cash yourself, pay for your expenses, and wait for reimbursement. (An option that I suspect you won't be too thrilled about.)

I also suspect you're going to have a very difficult time making travel plans without a credit card. How are you going to reserve a hotel room or a car? Make flight reservations? I guess you can do that via a travel agent and write them checks but that is likely going to be quite a hassle for you if you travel with any frequency.

The bottom line is if your employer wants to require you to have a personal credit card to use for business/travel expenses, they can. If this becomes an issue with your employer, you won't have any legal legs to stand on. Let's hope this doesn't become a big issue with them but terminating you because you refuse to obtain a personal credit card is not against the law.

 

[cbg]

The short answer to your question is yes, they can.

First off, with the possible exception of employers in the state of California, employers are not required by law to reimburse for travel at all. They can certainly decide how they want to do it.

Secondly, I am frankly not a fan of cash advances. They are more complicated to administer, more difficult to track and do not take unexpected issues into consideration. I can't blame your employer for not wanting to deal with them, even if the policy (which is quite likely not a contract) does provide for them.

Third, the company does have a right to expect that employees whose job requires them to travel, will be able to provide the means to do so. Most companies I have worked for will either provide a company credit card or expect the employee to put up the funds initially and reimburse only for expenses after they have been incurred.

Finally, Indiana is an at will state, which means they can fire you for any reason that is not prohibited by law. This generally means either a reason that violates Title VII (which this doesn't) or violates public policy. I suppose there's a .001% chance that Indiana has a law that would turn this into a public policy violation, but I wouldn't hold my breath.

If you were my employee, I wouldn't care whether you put up the initial payment by personal check, cash, or credit cards, but I would expect you to make the initial payments and then submit itemized bills for reimbursement. (Either that or I'd offer you a company credit card and before you ask, yes, I could legally make that a condition of employment). But if your employer feels differently, that's why we have both chocolate and vanilla ice cream.

 

[groupprez]

Credit Card

Beth & cbg,

Thanks for the response(s). While I understand your logic, my concern is that this was never a condition of employment. I made sure to address the "travel expense reimbursement" issue during the interview in order to ensure there were alternatives to using a PERSONAL credit card. Additionally, if there is no state law requiring employers to pay travel expenses, what about an employers own stated policy on covering them?

Here is some more background info:

Company policy states: "[Company] often requires employees to workshops, seminars, or other short-term training to learn new techniques and skills or to acquire awareness of issues affecting the [company's] projects. In such cases, [company] pays for registration, travel, lodging, and meal costs incurred by the employees, following the policy on travel and reimbursement."

No where in the policy does it state that an employee must possess a PERSONAL credit card. Furthermore, under "Travel Advances", it states: "The necessity for using personal funds to cover expenditures that are to be reimbursed can become a hardship. An option is to obtain an advance against anticipated out-of-pocket expenditures through the business office."

Why should I be subjected to possible discrimination/firing if I cannot personally front the cash for travel required by a company that hires me based on my abilities. My wife and I spend nearly all of our money on bills with very little left over for savings. Is it reasonable for an employer to interupt or cause financial grief in the personal lives of its employees without making a statement prior to employment?

While Indiana is an "at will" state, it is also a "right to work" state. This dilemma is causing me grief and has been a hot topic on my home front. I sincerely appreciate your (both of your) insight(s). Thanks.

 

[Beth3]

Right to work only means that you can't be compelled to join a union in order to be employed. It has nothing to do with your situation.

I understand your dilemma but here's where your logic is faulty. You want to argue that because obtaining a personal credit card was not a "condition of employment," the employer cannot now require it. That's just not true. Employers make policies and change policies all the time. They have no legal restrictions in doing so (provided they don't outright violate a law, e.g. a "no minorities" hiring policy.) Nor do they even have to have written policies in the first place.

If your employer says "Groupprez, your job requires you to travel. You can't reasonably do that without getting yourself an American Express and we don't want to give you $1,000+ cash advances, so do it," they may do so. If you refuse, they can fire you. This has absolutely nothing to do with prohibited discrimination, so get that out of your head. Additionally, it is far, far more common for people to have a credit card (or ten) than not, so it's just expected. It's not likely they WOULD inquire during an interview whether you have a Master Card or whatevever. They'd assume you did unless you brought the issue up yourself. You own part of the responsibility here for not specifically laying out for your prospective employer that you do not have any credit cards and asking how your travel situation could be accommodated.

Is the issue that you CAN'T get a credit card because of your past credit problems, or is it that you don't want to get one because of concerns about getting into debt again?

 

[groupprez]

Beth (et al),

Let me ask you this: Say you were hired by a company to conduct travelling sales. During the interview you ask, how do I get from work to the customer? The employers states, "you will use your personal vehicle." You say "okay, I can do that, I have a vehicle."

After being on the job for 3 months, your boss pulls you aside and says, "you know Beth, all of our other sales managers have blue cars and I noticed yours is red. Will you get a blue car? Wow, I really should have asked you what color your car was during the interview!"

Does this sound reasonable? Does this sound legal? Does this hint of possible discrimination? I don't mean to be petty but since when does making perfectly legal, moral, sound, personal financial decisions dictate labor law? I choose not to have credit cards b/c I know the horrible consequences that "can" go along with them. Furthermore, I do not possess the cash to lay out ahead of being reimbursed. There is not a law in this country that states you must have a credit card to get a job or rent a hotel room...it makes it easier but by no means can it be used to discriminate. I pay cash and the last time I checked, everyone accepts it.

Moreover, I was hired for my ability to do the job. YTD we are over $400k ahead of schedule and that hat gets hung on my hall tree (I am the Manager of Sales & Marketing). So, if I'm excelling at my job and my company fires me for failing to attain a credit card, you are telling me there is no legal recourse? If so, I find that truly hard to believe. Then again, the law is always right (even though it is not always correct)! Do you not think a labor lawyer would run with this if given the chance? Again, I haven't been fired/discriminated against yet, but I will be searching for a new job in the very near future. I sincerely appreciate any and all responses and take no offense in your posts. Thanks again.

 

[cbg]

Groupprez, what you are missing is that most discrimination is LEGAL.

Under Federal law, it is illegal to discriminate on the basis of race, religion, national origin, gender, disability, pregnancy and because you are over 40. Period. That's it. As of when my source material was published last year, your state did not protect any groups not already protected by Federal law (as above).

It is NOT illegal to discriminate on the basis of whether or not you have a credit card. It is not even illegal to discriminate on the basis of what color the employee's car is.

Regardless of whether or not you think your employer's actions are fair or reasonable, the fact of the matter is, they are legal. No amount of argument is going to change that fact.

 

[Beth3]

No, of course it wouldn't be reasonable for my employer to surprise me with a request that I buy a new car, simply because they wanted all the sales people to have blue cars. But unreasonable is not the same as illegal. A requirement that I buy a "blue car or else" is not illegal, nor is your employer's telling you that you must get a credit card illegal - which I think we've lost sight of the fact that it hasn't even happened yet.

NONE OF THIS HAS ANYTHING TO DO WITH DISCRIMINATION. You have a personal preference not to have any credit cards, that is all. I prefer chocolate over vanilla. It all falls in the same category - personal choice.

IF your employer should insist that you have to have a credit card, then you have a choice to make. Either quit the job or wait to be fired, or get an American Express (which must be paid off in full every month) and when you're not actually travelling, then lock it up in a safety deposit box where you won't have access to it.

You are right that you can pay for a hotel room with cash. My point is most hotels and motels won't reserve a room for a guest without a credit card and the same goes for rental cars. Can you get by without a card? Of course. And I'm sure many people should.

Your employer has not made an issue of this and I can't help but think you may be working yourself up into a tizzy for nothing. You've mentioned "negative vibes" but that's a long way from telling you that you either get a credit card or your fired. Talk to your boss. There may well be a way around this. I doubt they want to go to the trouble of replacing you over something that's actually a fairly minor issue.