Candidates with loan debts may be denied employment

In Russia, every fourth company checks the applicant’s credit history. This is evidenced by research data from the SuperJob portal. If in 2021 only 5% of candidates passed a credit history check, then in 2024 their share has already reached 17%. The number of companies interested in keeping their employees debt-free has more than tripled over the past five years. Why employers are interested in the credit history of applicants and what loans can be perceived as an additional advantage of a candidate, experts told MK.

Most often, employers check the credit histories of candidates whose positions involve a lot of money passing through their control and financial responsibility: financial director, salesperson, storekeeper, accountant, cashier and purchasing specialist. These same applicants are most often denied employment when they are found to have overdue debts. But there are other specialists in whose debts employers show increased interest. Every fourth account manager, 23% of sales specialists, and 21% of suppliers encountered a credit history check when applying for a job. In addition, employers check HR (that is, heads of personnel departments), as they are related to the formation of budgets.

“It is worth checking the credit history if the applicant is applying for a position related to access to money and other inventory items, budget control, and salary calculation,” says Alexander Veterkov, deputy general director of the Rabota.ru portal. “Delays on loans can indicate disorganization, inability to plan expenses, manage a budget – and if a person cannot manage his own money, then there is a possibility that he will not be able to cope with the company’s finances.”

A credit history can tell how an applicant fulfills his obligations to “other people’s” organizations. Employers suggest that this approach can help prevent the theft of company money. “An employee’s credit history contributes to the prevention of malfeasance, especially in materially responsible positions. If an employee’s current liabilities are comparable or even greater than their salary, then providing such a person with access to the company’s material or financial assets is associated with corruption risks,” says Alexey Volkov, Marketing Director of the National Bureau of Credit Histories (NBKI).

In addition, companies are trying to avoid possible additional burden on their own accounting departments. If an employee does not repay the loan on time, banks have the right to turn to bailiffs. They, in turn, begin paperwork and send the employer a writ of execution, according to which he undertakes to withhold funds from the employee’s salary to pay off the debt. “This creates additional inconvenience for the company: the accounting department transfers part of the employee’s salary to the deposit account of the bailiffs, and they then send these funds to the creditor until the enforcement proceedings are terminated,” explained Alexey Klochkov, head of HR-Tech at Happy Job. . At the same time, having a mortgage, for example, can have a positive impact on the decision to hire a candidate. This is especially true for the popular IT mortgage program: according to the conditions, a low mortgage interest rate is maintained only if the person continues to work in an industry that is subsidized by the state. An employee for whom it is important to maintain a preferential rate will be less inclined to change jobs frequently, the expert explained the logic of employers.

Also, by checking a credit history, employers evaluate not only how a candidate fulfills his obligations, but also how much his debt load may affect his productivity. “Recently, one study showed that the productivity of an employee with overdue debt is on average 25% lower, since he is busy solving his problems, including during working hours,” said Elman Mehdiyev, founder of the Creditcheck service. — And failure to fulfill obligations can be a “red line” for the employer, especially if we are talking about large financial liability. The market knows examples of how a courier with a bad credit history receives orders for delivery with a lower cost and, accordingly, with a lower payment.”

An additional positive aspect of checking a candidate’s credit history for an employer is that banks themselves conduct an assessment of borrowers, which the company can indirectly rely on. “In the process of making a decision on issuing a loan, banks actively use scoring models for assessing creditworthiness, based on collecting information about the potential borrower,” recalled Svetlana Zubkova, associate professor of the Department of Banking and Monetary Regulation of the Financial University. “Therefore, if a candidate, when hired, has a standard loan and conscientiously fulfills his obligations to service it, then for the employer this is one of the factors in the reliability of the future employee and his interest in work.” Although in the end this resembles a kind of vicious circle, because banks, when issuing loans, attach great importance to the presence of a constant income for citizens and the length of service in one organization.

But there is no need to worry that a candidate will be denied employment just because of a bad credit history. Firstly, this would be a violation of the law, which none of the companies will do. “A bad credit history is not considered a legal basis for refusal to hire, and the applicant in this case has the right to demand an explanation in writing (Article 64 of the Labor Code of the Russian Federation), Vetryakov emphasized. “The reasons that the employer can describe in the response must be related exclusively to the professional qualities of the person.”

Secondly, the labor market in Russia today is fundamentally short of workers, so companies have no choice if they do not want to suffer from a loss of competitiveness. “The trend towards job seekers in the labor market continues,” Vetryakov pointed out. “Because of this, even if an applicant does not have an ideal credit history, this is rarely a significant factor in hiring.” When choosing an employee, as it should be under normal conditions, their professional competencies and “soft” skills come to the fore when choosing an employee – communication skills, analytical thinking, stress resistance (for each area they are determined separately).