I have been asked, as a requirement for employment, to sign a document
allowing the hiring company to engage a third party to review my
credit status. My position with this company would not involve
handling money or sensitive information, therefore, I see no reason
that this is anything more than an invasion of my privacy. Are there
any laws regarding this issue?

Hi, greenga,

Unfortunately, there are no regulations forbidding a company from
checking your credit report as a condition of your employment, whether
you handle cash or not.  In fact, under the Federal Fair Credit
Reporting Act, specifically 15 USC 1681 Sec. 1681b, checking your
credit as a condition of employment is permissible:

"Sec. 1681b. Permissible purposes of consumer reports
A consumer reporting agency may furnish a consumer report under the
following circumstances and no other:

(1) In response to the order of a court having jurisdiction to issue
such an order, or a subpoena issued in connection with proceedings
before a Federal grand jury.

(2) In accordance with the written instructions of the consumer to
whom it relates.

(3) To a person which it has reason to believe--

      (A) intends to use the information in connection with a credit
transaction involving the consumer on whom the information is to be
furnished and involving the extension of credit to, or review or
collection of an account of, the consumer; or

      (B) intends to use the information for employment purposes; or

      (C) intends to use the information in connection with the
underwriting of insurance involving the consumer; or

      (D) intends to use the information in connection with a
determination of the consumer's eligibility for a license or other
benefit granted by a governmental instrumentality required by law to
consider an applicant's financial responsibility or status; or

(E) otherwise has a legitimate business need for the information in
connection with a business transaction involving the consumer."

FCRA
http://www.epic.org/privacy/financial/fcra.html 

Some employers use a prospective employee's credit report as a means
to determine whether or not s/he will be a dependable employee - lots
of dings on the credit report could be indicative of irresponsibility.
 *However*, there are some protections afforded to the consumer -
employers are not given a full credit history.  Rather, they are given
a modified report of the past two years.  Additionally, if you choose
not to sign the document, the employer cannot access your report (he
may, however, also decline to employ you):

"Federal law specifically allows potential and current employers to
view a modified version of your credit report for employment purposes
such as hiring and promoting.

This employment report includes much of the information about your
loans and credit cards that is listed in your credit report. To
protect your financial security, all Experian employment reports omit
your account numbers."

[...]

Recognizing the sensitive nature of employment reports, legislators
enacted several consumer protections. Among them:

• Federal law prohibits anyone from accessing an employment report
without first obtaining written permission from the consumer.

• If the employment report plays any part in a decision that
negatively impacts the consumer, federal law requires the company to
give the consumer a copy of the report along with a written
description of the consumer's rights."

Experian - All About Credit
http://www.experian.com/consumer/help/credit/employment.html

(The remainder of the page discusses extra protection measures
Experian has put into place for the purpose of pre-employment reports.
 I urge you to give the entire page a thorough reading for a good
overview of your rights.)

If you're concerned that your credit status may preclude you from
employment, there are steps you can take.  Get copies of your credit
report from all three major reporting agencies, and check them
carefully for accuracy.  If you find any mistakes, dispute them
immediately (you can even do this online) - credit bureaus are not
allowed to report information that is in dispute for 30 days after the
dispute is filed, while they investigate:

Equifax  
P.O. Box 740256   
Atlanta, GA 30374-0256 
https://www.ai.equifax.com/ai/ 
 
TransUnion LLC  
Consumer Disclosure Center  
P.O. Box 1000  
Chester, PA 19022  
1-800-888-4213  
http://www.transunion.com/Personal/PersonalSolutions.jsp  
  
Experian  
P.O. Box 2002  
Allen, TX 75013  
1-888-397-3742  
http://www.experian.com/consumer/index.html# 

Like you, I find credit screening for jobs not requiring the handling
of money or sensitive data to be an unnecessary invasion of privacy. 
It is permissible by law, however, so the best you can do is make sure
your reports are free of any mistakes, and if there are problems,
explain the circumstances to your prospective employer.

I wish you luck!

--Missy

Search terms:  [ "credit report" employment] and [ FCRA ]

Great, quick and sympathetic - even though it wasn't necessarily what
I wanted to hear. Thanks!