The Credit History Underclass - NYTimes.com Millions of Americans with damaged credit records are at risk of being unfairly denied job opportunities by companies that use credit histories to screen applicants. Faced with growing public complaints, seven states have rightly limited the use of credit histories by potential employers. Federal, state and local lawmakers who are considering similar legislation are on the right track. Job-related credit checks have grown increasingly popular, with an estimated 60 percent of employers using them, up from about 20 percent in the mid-1990s. Yet several studies have shown - and some in the credit-checking industry readily admit - that a poor rating does not automatically make a person a poor job prospect or more likely to commit fraud. Very often, damaged credit is the result of a layoff during the recession, divorce or a catastrophic illness. Washington, Connecticut, Hawaii, Illinois, California, Maryland and Oregon have passed laws limiting the use of credit screening in hiring decisions. But some of these laws still need to be tightened and exemptions narrowed. Illinois, for example, allows employers to continue to do credit checks on managers and minor retail workers. Bills pending in the New York State Assembly and the New York City Council would be more restrictive, prohibiting employers from using a job applicant's credit history except in cases where such checks are required by either state or federal law. A bill pending in Congress, called The Equal Employment for All Act, would work in a similar fashion. Credit-history screening can also lead to discrimination against minorities, who have historically been targeted for predatory lending practices that made them more vulnerable to default and blemished records. The Equal Employment Opportunity Commission, which has sued two companies for credit-record screening, has repeatedly said that such screening is illegal when it excludes groups of people and is not job-related or justified by business necessity. The interest around this issue shows that more lawmakers are starting to realize how this unfair practice damages the lives and job prospects of millions of people. The sooner they act to end it, the better.