You finally get approval to fill that long-vacant position – the opening that has taken your team to the brink of burnout. You spend nights and weekends reviewing the pile of applicants, and narrow it down to someone who looks like a superstar. They’ve got the experience, the education, the specialized certifications, terrific references, and, most important of all – they’re an exceptionally good fit for your company and your team.

But, and this is a big but – they’ve got a bad credit score. So HR tells you no. You can’t hire them.

There are lots of good reasons not to hire someone. Usually – bad credit alone isn’t one of them. And yet, it’s become the reason du jour, in the eyes of many, to disqualify an otherwise highly qualified person to do a job they’re particularly well suited for. And it makes us wonder (although not for very long, really) if some employers might be taking undue advantage of the current imbalance in the labor supply/demand ratio.

A March 2 Associated Press article by Kathleen Miller says, “Sixty percent of employers recently surveyed by the Society for Human Resources Management [SHRM] said they run credit checks on at least some job applicants, compared with 42 percent in a somewhat similar survey in 2006.”

I get the arguments: People with money woes are more tempted to steal from their employer. Bad financial decisions mean bad judgment at work. (Try telling someone “You’ve made too many bad spouse choices, so we’re not hiring you.” See how far that gets you with the judge.) SHRM likes to point to a study by the Association of Certified Fraud Examiners that found that the two most common red flags for employees who commit workplace fraud are 1. living beyond their means, and 2. having difficulty meeting financial obligations. Well, no duh. They needed a study to figure that out?

And the counter from the social humanitarian everybody-deserves-a-job bunch is “how can you get out of debt if no one will give you a job?” It’s as if they think employers are somehow obligated to put people on their payrolls to pay some social duty.

And employers who use the practice will point out that it’s perfectly legal (which it is, in most US states), and besides, you can’t run a credit check without the applicant’s permission. Yeah, right. Like the applicant who refuses permission has any hope of being hired.

The real problem with giving too much weight to a job applicant’s credit score is that, in too many cases, it’s simply a faulty filter. OK – I’m not a complete idiot. For most bank jobs, jobs in accounting and finance, those who handle money, C-level positions, and those with greater opportunity to commit fraud – employers have an obligation to be duly diligent in bettering their odds against would-be miscreants. But for the vast majority of jobs that fall outside that realm, credit score is no better a predictor of (honest) job success than are race, gender, marital status, religion, or national origin. And didn’t we outlaw that a long time ago?

Did somebody say outlaw?

Yep. As in so many cases, when organizations (or individuals) can’t be relied upon to behave like grown-ups on their own, the law steps in. Wisconsin, South Carolina, Oregon, and thirteen other states are currently considering bans on most pre-employment credit checks.

What to do?

Employers:

• Beware of using faulty filters…like credit checks, and other sieves that let can let bad hires in, and keep good ones out.
• Start looking at hiring quality for what it is: a competitive issue. These days, the company with the best talent wins. So what if the best talent went through a messy divorce that trashed her credit, or was eaten alive by medical bills from his child’s serious chronic illness? The one with the best talent still wins. This stuff’s too important to rely on arbitrary standards.
• Realize that hiring is one of the most important jobs any manager does. And one of the hardest. It may sound attractive to relegate the hard work of hiring to automated resume scanners, exams and assessments, and credit checks, but in the end, there’s no substitute for taking a hard look at the things that really matter, going eyeball-to-eyeball with the prospect, using judgment and your powers of discernment, and making a well-informed decision.
• If you do check credit, and find something of concern, on someone you think would be good in the job, give them a chance to explain. And then listen.

Applicants:

• As if you needed one more reason to maintain a clean credit record, this is one.
• Unless pre-employment credit checks are prohibited where you live, be prepared for the scrutiny. Just as you would if showing your home to a prospective buyer, tidy up your credit record before you put your career on the market.
• Know your credit score, and examine your credit record. If there’s an error, U.S. residents can visit the Federal Trade Commission’s website to learn step-by-step how to dispute and correct the error.
• This issue underscores the value of investing in networking, long before you may need it. Chances are, if the prospective employer has some history with you, or valued connection to you, your credit score may matter a whole lot less.

Happy hunting…on both sides.

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Richard Hadden (twitter at http://twitter.com/ContentedCows) is a leadership speaker, author, and consultant who helps organizations improve their business results by creating a great place to work. He and Bill are the authors of the acclaimed business classic Contented Cows Give Better Milk, and the followup Contented Cows MOOve Faster.

As I am already blessed beyond anything I deserve, with a wonderful wife and family, good health, dear friends, work that I love,  all the material things I need, and most of the material things I want, I find that my list of Christmas wishes digs, in some cases, deeply into the realm of the trivial, and in other cases, the seemingly unattainable. I, like many others, wish for peace in the world, the elimination of poverty, and that my Jacksonville Jaguars would have a winning season. But if I could sit down and make a list of wishes this Christmas, it might look like this:

I wish that people would:

• forever ban the use of the following phrases from their language:

1. the fact of the matter is
2. to a person
3. I’m reaching out to you
4. “I was like,” when they mean “I said”
5. “No problem,” when they mean “You’re welcome.”
6. At the end of the day
7. Does that make sense?

• stop referring to the “Queen of England”. She’s the “Queen of the United Kingdom”, or the “Queen of Britain”, which probably sounds better and is easier to comply with. What about Wales, Northern Ireland, and Scotland? We don’t say Barack Obama is the president of Hawaii, do we? I told you this was trivial.
• use their turn signals.
• speak more quietly on their mobile phones in public.
• learn when to use “Reply All” on emails, which is almost never.
• know what they want when they’re in front of me at Starbucks.

I wish the graphics operators at my local TV station would learn to spell, and to proofread what they put on the screen.

…that the socks I put into the laundry in pairs would come out as such.

…that my stapler had a gauge on it so that my first indication of its being empty would be something other than clamping down with a staple-less stapler.

…that Microsoft Windows was better than it is. Please don’t tell me to switch to a Mac to solve the problem. I know, I know…

…that I could figure out how using Twitter would help my business.

…that I could make better naan bread.

…that fast food restaurants were.

…that people were less uptight about the phrase “Merry Christmas”.

…that I could consistently remember where I put my sunglasses.

…that there weren’t so many things in my life that rely on batteries.

And I wish that our elected representatives would do a better job of representing us, and would behave with greater civility toward each other and people who disagree with them. I told you some of these were probably unattainable.

That’s really about it. Like I said, I’m lucky…very lucky. But as long as we’re wishing, those are my wishes.

And finally, I wish that everyone reading this has a Merry Christmas, if you celebrate Christmas, and that everyone has a blessed and prosperous 2010. That’s something we can all celebrate.

Richard Hadden (twitter at http://twitter.com/rehadden) is a leadership speaker, author, and consultant who helps organizations improve their business results by creating a great place to work. He and Bill are the authors of the new book Contented Cows MOOve Faster, as well as the acclaimed business classic Contented Cows Give Better Milk. Learn more about them and their work at ContentedCows.com.

In today’s mail, one item clearly stood out from all the bills and advertisements I dragged in from the daily haul. An envelope, addressed by hand, to my wife, with the return address from a couple we know from our church.

As a hobby and side business, my wife makes handmade decorative soap, with Celtic designs, reflecting her native Scotland. This year, our church choir, to which we both belong, presented a Christmas concert with a Celtic theme. As a small token of our esteem for our fellow choir members, and because the Celtic connection seemed particularly appropriate, my wife placed a piece of soap, packaged and labeled, inside the music slot of each of the 87 members before this weekend’s performance.

Nearly every member came up and personally, and most graciously thanked her for this small gift. One woman, Barbara, sat down, and took the time to write a note, address it, put a stamp on it, and put it in the mail. Barbara is a perfect southern lady, of mature years, and reeking of class. Not snootiness – real class. She has an email account and isn’t afraid to use it. But she knows when not to.

The next time someone at work does something you particularly appreciate, sit down, pull out a note card, and write a note to say thanks. Your small and simple gesture will stand out and be remembered long after your email would have landed in the delete folder.

Thank you.

Richard Hadden (twitter at http://twitter.com/rehadden) is a leadership speaker, author, and consultant who helps organizations improve their business results by creating a great place to work. He and Bill are the authors of the new book Contented Cows MOOve Faster, as well as the acclaimed business classic Contented Cows Give Better Milk. Learn more about them and their work at ContentedCows.com.

Alexander McCall Smith, the Scottish author of the acclaimed “Number One Ladies Detective Agency” series, set in Botswana, is one of my favorite novelists. In his latest work, from his Isabel Dalhousie series, entitled The Lost Art of Gratitude, he relates that Isabel, the Edinburgh-based editor of a philosophical journal, has received a letter from the company that prints the journal.

“They had bought a supply of superior Finnish paper, they revealed, and would keep some of this for Isabel if she wished; a sample was enclosed. The offer reminded her of her obliging butcher, who, from time to time would pull something out from under the counter and say that he’d been keeping it for her, some delicious cut that he thought she would particularly appreciate.  Small acts of commercial friendship, binding together customer and provider.”

These days, “small acts of commercial friendship” are especially appreciated by customers. And especially savvy on the part of providers, most of whom need to explore every way possible to win the loyalty of customers who have less disposable income, and usually more choices, than ever before.

I like it when Shenequa, my Starbucks barista, sees me approaching the store and fills a cup with my “usual”, a tall Pike Place, and then asks me how my family (every member of which she knows by name) is doing.

Likewise, I appreciate it when I stay at one of the chain of Kimpton Hotels, and they automatically provide me with feather pillows and a room near the elevator. Sure, they got that info from an online profile that I filled out, and so it’s different from Shenequa’s personal gesture, but it’s no less appreciated.

I enjoy reading comments from the customers of a bank for which we manage a customer satisfaction survey. It’s not uncommon to read something like “I love this bank. My banker called me last week to tell me about a special CD offer you had. He remembered me saying, months ago, that I wanted something short term with higher interest. It wasn’t a lot of money, so I was surprised he remembered. I won’t forget that.”

In an increasingly impersonal world, these small, but important acts are distinctive, and memorable, whether they originate from a highly sophisticated customer relationship management system, or the attentiveness of a caring employee or business owner.

What could you do, today, to demonstrate your “commercial friendship”, to bind you and a valued customer closer together?

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Richard Hadden (twitter at http://twitter.com/rehadden) is a leadership speaker, author, and consultant who helps organizations improve their business results by creating a great place to work. He and Bill are the authors of the new book Contented Cows MOOve Faster, as well as the acclaimed business classic Contented Cows Give Better Milk. Learn more about them and their work at ContentedCows.com.