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Can they legally do this?

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myjojo

Guest
What is the name of your state?IOWA

After working for a private owner of a convenient store for almost 2 years, the owner decided to allow a well known convenient corporation come in and lease the building, and change the name into this corporations name. The owner told all employees that they would all be staying on, no one would lose their job.
Two days after the Corporation opened the store in their name, they called in 2 employees, told them after running a credit check, they found (on one employees credit report) that this employee had failed to pay on two student loans consistently, making them months past due, so they were firing this employee. Their reason: "You are a potential thief, because you have not paid these student loans as promised." When asked what exactly did they mean, they only responded with "People who do not pay their bills as promised, are potential thiefs."

Is it legal to check a persons credit report without that person signing a release to allow them to do so? Is it legal to fire a person for this reason? If it is not legal, what should a person do?
 


Beth3

Senior Member
Is it legal to check a persons credit report without that person signing a release to allow them to do so? Not if the employer used an outside agency to perform the credit check. However it's possible all of you DID sign a release and don't remember. Did you fill out an application form when you were first hired? It so, it's quite possible that on the last page, just above where you signed, there was a general release authorizing the employer to check credit history, perform reference checks, etc.

Is it legal to fire a person for this reason? Yes. The logic is arguable but it's legal.
 
M

myjojo

Guest
IOWA

First off Beth3, let me thank you for answering with a very polite response, I really appreciate it. Some others on here can be so rude and inconsiderate, so when I come across one like you, I like to offer my thanks. :)

An application was filled out for the first initial private employer, and NO, it doesn't state on there anywhere that the applicant is signing to allow the employer to run an outside credit check or any sort of credit check for that matter. The new corporation that took over has NOT had any employee that was already working, fill out a new application for them.

Although it is legal to fire someone for this, it sure is a terrible thing that a person gets thrown into a negative statistic rating becasue others may be potential thieves, what ever happen to treating a person individually?

The only thing these 2 employees are going to enjoy out of this matter is the fact the area is a very small farming community where people stick together. This corporation has just cut their own throat by firing the locals and bringing in their own people...many of the locals have already voiced their opinions & have boycotted this place, vowing to never shop their store and never purchase their gas & fuel, they won't be in operation for long.

And one last thing, one of the girls who was let go, also works at the local BANK...for the past 9 years!! She's trustworthy there, but not trustworthy enough to work at a convenient store! :confused:
 

Beth3

Senior Member
myjojo, the relevant law here, which I failed to mention, is the Fair Credit Reporting Act (FCRA.) There is ample info available on the federal law via the internet. You'll need to review it and then make a determination whether you believe a violation occurred.
 

cbg

I'm a Northern Girl
BTW, I just want to reiterate that this is illegal IF AND ONLY IF the employer used an outside agency to run the check. If they ran it themselves, then no signed release is required.
 
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myjojo

Guest
IOWA

Thank you cbg, that may answer my question right there. I don't think I quite understood the response of using an outside agency. I'm almost sure they did it themselves. It's just upsetting that employers can do this to an employee, especially after that employee has worked for them for 2 years without incident.

I guess they'll get their satisfaction by seeing the decline in business at this place due to the locals retaliating against them. The original private owner had a good reputation to uphold, owning several businesses in the area, I'm afraid he has just harmed himself considerably in this community. The 2 employees who have been terminated have now both found employment with a near by competitor...I'm sure the war has only just begun.

Thank you all for your help, it's been greatly appreciated!!
 

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