The EEOC has filed a nationwide hiring-discrimination lawsuit against Kaplan Higher Education Corp., charging that the company engaged in a pattern or practice of unlawful discrimination by refusing to hire a class of black job applicants. Since at least 2008, Kaplan Higher Education has rejected job applicants based on their credit history. This practice has an unlawful discriminatory impact because of race and is neither job-related nor justified by business necessity, the EEOC charged in its lawsuit. The EEOC says that this is a violation of the Civil Rights Act of 1964 and that it attempted to reach a voluntary settlement before filing suit. The EEOC seeks to get Kaplan to stop this practice, as well as recover lost wages, benefits and offers of employment for people who were not hired because of Kaplan Higher Education’s use of job applicants’ credit history.
In a released statement, Kaplan, which is owned by the Washington Post Co. (The Root‘s parent company), said, “We are an equal opportunity employer, and we are proud of the diversity of our workforce. Kaplan Higher Education conducts background checks on all prospective employees. For employees whose responsibilities include financial matters, such as those who advise students on financial aid, background checks also include job-related credit histories. This is not unusual. As many as 60% of Society of Human Resource Management (SHRM) members consult credit reports in the hiring, promotion or dismissal of employees.”
The gauntlet has been thrown down. Is it fair to reject people based on credit history in a situation where the credit history is not job-related or justified by business necessity? It’s not as if they’re stock traders or working in banks. What do you think?
Read more about this lawsuit at the Washington Post, and for more information on how hiring based on credit scores can be discriminatory, read Sherrilyn Ifill’s “A Bad Credit Score Could Keep You Unemployed.”