Professional etiquette dictates that co-workers shouldn't share their salaries, but one credit reporting agency -- Equifax -- is making big bucks from selling how much you make to third parties.
The practice has raised concerns from seven members of Congress who on Wednesday sent a letter to the head of Equifax requesting more information about its employment and income verification business, called The Work Number, and its consumer protections. The big worry was if Equifax was sharing salary information with debt collectors, as was suggested last week in a media report.
The answer is no, according to company spokeswoman Pamela Stevens. She explained that debt collectors can only verify an individual's place of employment through The Work Number, and only under circumstances dictated by the Fair Credit Reporting Act, or FCRA.
So who gets to see your income details?
Lenders and prospective employers, in accordance with the FCRA, says Stevens. Lenders typically get a consumer's OK to confirm their employment status and income during the application process for credit, such as a mortgage or car loan. Employers also must get signed consent from job applicants before The Work Number will release income information on that individual, Steven says.
Employers are also the ones who supply payroll data to The Work Number for its verification process. In return, The Work Number fills employment verification requests from employees on behalf of the employer. Consumers typically need to verify their employment when applying for a mortgage or renting an apartment.
Workers usually sign away their rights to keep their salary private as soon as they are hired. Companies have new employees sign a release that gives the employer permission to share employment information, including salary, to a third party, says Kate Kennedy, a spokeswoman for the Society for Human Resource Management.
The Work Number maintains more than 210 million employment records and provides the information to more than 70,000 different companies, including Bank of America, Chase, Citigroup, the U.S. Department of Housing and Urban Development and other government agencies. The division raked in $258.5 million in revenue last year, a third more than in 2011, Equifax reported Wednesday. And it's all legal.
But that doesn't necessarily make it fair, says John Ulzheimer, president of consumer education at SmartCredit.com, who says it's "another step closer to having no financial privacy." He also worries that employers could possibly lowball salary offers to job applicants if they know the applicant's income history.
"The job application should be updated to read: 'We already know if you're employed and what you're making but feel free to tell us anyway,'" Ulzheimer says. "If employers are getting data about what we make then it's only fair that employers tell us, truthfully, what they're paying others in our position. That's an even playing field."
What do you think?
Follow me on Twitter: @JannaHerron