A collection agency benefits from knowing where you work. In the event the company ever files and wins a lawsuit against you, knowing where you work enables the collection agency to serve your employer with a legal order forcing it to garnish your wages for the debt. Collection agency polices differ by company, but debt collectors utilize a variety of methods -- both legal and illegal -- when verifying your employment status.
Post-Judgment Interrogation
If your state allows creditors to conduct post-judgment interrogations and a collection agency recently won a lawsuit against you, it can send you a summons requiring your presence in court for a post-judgment interrogation. During the interrogation, a collection agency representative can question you about your finances and your employer. You must answer the questions honestly or risk the judge holding you in contempt of court.
Account Documentation
Collection agencies buy debts from other companies. In some cases, the price of an account depends upon the amount of information that comes with it. If you listed your employer when you filled out your application with the original creditor and remain employed by the same company, a collection agency that pays extra for a fully documented account will receive this information. A debt collector only needs to contact the employer listed to verify whether or not you still work there.
Skip Tracing
The collection agency can attempt to locate your employer through a process known as "skip tracing." Skip tracing involves using publicly available information to locate an individual. Pulling your credit report is one skip tracing method a collection agency can use to locate your employer. Because the company has a valid financial reason for needing access to your credit records, the Fair Credit Reporting Act notes that it can access your credit history without your permission. Credit records sometimes, but not always, contain employment information.
Reviewing your credit report isn't the only skip tracing option available to debt collectors. Collection agencies occasionally hire an independent third party, such as a private investigation firm or professional skip tracer, to track down errant debtors' employers.
Illegal Calls
The Fair Debt Collection Practices Act allows debt collectors to contact your family members by telephone, but a collector may only do so once and only if the company needs to locate you to initiate collection activity. If a debt collector is desperate to find out who you work for, he may call your family members and ask -- even though doing so is against federal law.
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