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December 22, 2010 3:03 PM Apparently Kaplan Is Concerned About Debt

By Daniel Luzer

Things continue to look bad for Kaplan, the education management corporation owned by the Washington Post Company. Apparently now would-be employees are suing the company for discrimination.

According to a piece by Miami’s David Volz in Examiner.com:

Kaplan Higher Education Corp., which has 2,600 employees in the Miami area was sued by the U.S. Equal Employment Opportunity Commission on December 21. The organization was charged with refusing to hire a class of African American job applicants.
Kaplan Higher Education used credit scores as a basis of rejecting a large number of people, many of whom were African Americans. Since 2008, Kaplan Higher Education has rejected many job applicants based on credit history. The EEOC argues in the lawsuit that the rejections have an impact on African Americans and the rejections are wrong because they are not job related.

The lawsuit argues that because the rejections were based on applicants’ credit scores, they were not job related and thus violated Title VII of the Civil Rights Act of 1964.

The interesting thing about this is that having poor credit scores happens when people can’t afford to service the debt they have accumulated. And high debt is very often the result of a relationship with, well, Kaplan Higher Education, the company that owns several for-profit colleges.

While Kaplan Higher Education earned more than $1.5 billion last year, more than 27 percent of students at the company’s colleges have defaulted on their student loans. There’s your poor credit score. That’s the highest default rate of any for-profit education company.

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer