Does My Company Need a Background Check Policy?
Does your company have a background check policy? Do you think it’s necessary? According to a recent article on HRDive.com, Tess Taylor gives us reasons why having a specific policy for background screening is important for your company.
First off, company reputation matters. It is important to exhibit that your company treats job applicants fairly. Taylor also points out that it is extremely important to check out why an applicant may have failed a background check, because the reason may or may not disqualify them from employment. It is extremely important to check for any discrepancies that may be found in a background check, because background checks, as we all know, aren’t always 100% accurate.
Taylor notes the importance of developing a formal procedure of addressing candidates that may have failed background checks, assuring that they are FCRA and EEOC compliant.
Finally, Taylor stresses the importance of having a written background check policy that is easy for applicants to understand, getting their written permission to conduct the check, and then having a specific system to “evaluate the validity of any third-party background check companies”.
So if you don’t have a current policy in place for background checks, all of the above are reasons why you may want to consider implementing one.
1 in 4 Employers Don’t Conduct Pre-employment Background Checks
Recently, CareerBuilder conducted a survey and found that 28% of those surveyed did not conduct background checks on potential employees. According to PR Newswire, the national study was conducted online by Harris Poll on behalf of CareerBuilder and included a sample of 2,379 hiring managers and human resources professionals across industries and company sizes in the private sector.
According to the same survey, 75% of employers said they have hired the wrong person for a position. On average, this costs the employer $17,000 per “bad hire”. According to Ben Goldberg, CEO of Aurico, “If an employee isn’t well-suited for the job or has a bad attitude, the time they spend not working could significantly impact your bottom line. That’s why it’s so important to make sure qualifications are substantiated.” He goes on to state, “It’s a hard cost to quantify, but it adds up when you consider the loss of employee morale, the additional supervision that employee needs, productivity loss for the organization, revenue that’s not being generated, and client relationships that could be turning sour as a result of bad impressions.”
The survey then broke down which reports are utilized by those who do background checks on potential employees:
- Criminal background: 82%
- Employment verification: 62%
- Education verification: 50%
- Illegal drug use: 44%
- Professional license check: 38%
- Credit check: 29%
The survey then digs a bit deeper, and breaks down the cost and overall effect a bad hire can have.
Finally, Goldberg sums up the importance of making a good hire. “As you are hiring candidates who represent you and act as an extension of your company, accurate and thorough background checks are vital. Especially because the cost of replacing an experienced worker who doesn’t work out can cost a decent amount of that individual’s salary.”
Continuous Background Screening
If you’ve read some of my posts in the past (which you all should have), you’ll notice that I enjoy Roy Maurer‘s articles. He does a great job of viewing the background screening industry in an “outside of the box” sort of way.
In one of his most recent articles on SHRM.org, he talks about how “continuous, post-hire monitoring” is becoming the new norm for many employers. According to Raj Ananthanpillai, CEO and president of IDentrix, “background check vendors do a good job with the past…but people are dynamic and so is the risk they propose to organizations. One-and-done background checks don’t account for the dynamic nature of risk factors.”
What are some of the post-hire threats that are most concerning to employers? According to Maurer, they can be anything from “embezzlement, fraud, and theft to violent behavior”. According to Les Rosen, the CEO of Employment Screening Resources, “an employer may discover post-employment that critical information was missed during the hiring process. For example, an employer may discover post-hire that a person is a registered sex offender or that a credential is faked. Employers shouldn’t assume that passing a background check means there will never be issues with insider threats down the line.”
Rosen notes the importance of job application forms and employee handbooks being clear that any misinformation or omission, regardless of when it is found, can result in termination. Employee handbooks should be very specific in what will happen if application or interview falsehoods or omissions are found post-hire.
So while the importance of continous monitoring of employees is what more employers are looking into, pre-employment background screening continues to be vital. According to Rosen, “employers should have policies, practices, and procedures to carefully select employees in the first place.”
Austinites Lose Lyft and Uber on Propostion 1 Defeat
Ride sharing companies Lyft and Uber discontinued their services in Austin following the defeat of Proposition 1, which would have exempted ridesharing services from carrying out mandatory fingerprint background checks on all of its drivers.
Voters rejected the proposal on May 7th, 2016, and shortly after Lyft and Uber pulled their services from inside Austin city limits, denying citizens what many see as a safe and convenient service. Legislative officials and others against the proposal maintained that voting for it would put ride sharing-users at risk. They argued that if these ride-sharing companies were not required to obtain bio-metric data from its drivers, these drivers could use false or stolen identity information in order to get hired. In these cases, the argument goes, people with criminal records could get through the screening process, putting customers at risk. Prior to the introduction of Proposition 1, Lyft and Uber conducted their background checks based on information provided by those seeking to be employed as drivers.
However, proponents of Proposition 1 argued that the current screening process is more than sufficient, and requiring fingerprints would only reveal those criminals who have a record with the FBI. Further, proponents argued that not passing Prop 1 would do more damage than good, in a city known as the “seventh drunkest city in the nation” because it would deny people an affordable and reliable alternative to expensive taxis. Their argument goes, the ride-sharing service is very important in a city where drunk driving is a chronic and serious problem.
Proponents also argued that while Lyft an Uber conduct their screenings using a national database, taxi drivers only undergo their screenings stateside. This leaves the very real possibility a taxi driver may have committed a crime in another state, then slipped through the system to continue working as a taxi driver. This, they argue, is much more alarming than the very slim possibility a Lyft or Uber posed as someone else.
Other proponents of Proposition 1 later claimed that it was not passed because Austin city officials were concerned about the fingerprint processing fees they would lose. Further, critics charged, officials worried they would lose a lot of revenue from DWI and DUI fines since citizens would have use of the safe and affordable ride-sharing service, causing a big drop in the number of people driving while under the influence.
Avoid Costly Errors With Quality Background Check Services
When choosing a background screening service, it is important to find one that will provide a full and timely screening of your potential employee. To avoid costly errors (or worse) in your hiring process, follow these guidelines to bringing your new talent on board.
Accuracy
First and foremost, make sure the background service company you choose provides accurate information. Ideally, the screening service company you choose will provide testimonials from previous clients on their website or brochure. But this alone isn’t enough. Before you pay for a service, be sure to verify its accuracy by checking with a third party reviewer. If none are readily available ask for references from prior clients and make a few phone calls. With the time pressures involved in the hiring process, you may be tempted to speed through this most important step. Don’t. Remember the person you are hiring will be entrusted with an important role, and perhaps money or even confidential company information.
Speed
Prime candidates are often selected very quickly, because there is intense competition to bring on board the best employees. This means the speed of the screening company is important. Don’t worry about saving a few dollars when paying a little extra will get you the results sooner from a high quality, accurate provider. Hiring new and trustworthy talent is an investment in your company’s future. Be prepared to pay the little extra expense.
User Friendly
While browsing through the various background services available, pay attention to the user interface provided. Test it out, ask to try it with a sample, make sure that it is easy to use and understand, and has detailed but clear and simple instructions. It is important that the service provider you select has a user friendly dashboard so you can feel comfortable using it without spending a large amount of time getting your results, or worse, spending a large amount of time getting information that is hard to understand or interpret.
Full Features
Make sure your provider also has extra features and services provided, to give the fullest and most accurate picture of your potential employee. Your provider should also offer services like providing an overview of your potential hire’s social media presence, including public information on their Facebook, Twitter, LinkedIn, and Google plus pages.
Potential Lowe’s Employees Receive $50 Gift Cards
If you live within 25 miles of a Lowe’s and recently applied for a position at the “big box” hardware store chain but were passed over, you may be receiving a $50 gift card. If you live further than 25 miles away and are in the same situation, you might be receiving a check for 35 bucks.
According to an article on Law360.com by Matthew Guarnaccia, a judge in North Carolina recently approved a $2.2 million settlement to compensate 37,600 prospective Lowe’s employees who were passed over for positions because of information contained in background checks.
The case dates back to 2003, when three men sued Lowe’s as well as LexisNexis Screening Solutions (now First Advantage Background Services Corp.). The men alleged that Lowe’s based it’s hiring decisions either in whole or in part on information found in consumer reports generated to investigate a potential employees criminal history. This in itself was not the crime. The reason why Lowe’s failed to comply with FCRA regulations is because they did not provide these prospective employees a with a copy of these reports.
Most HR professionals know that this is a major “boo boo”, but often times it’s one of those things that falls through the cracks. In the end, the judge ruled that Lowe’s did not comply with regulations of the Fair Credit Reporting Act, known to many of us involved in the HR and background screening worlds as “adverse action”.
To find out more about how Adverse Action works, take a look at this flowchart that we created here at VICTIG to assist our clients:
Hopefully this flow chart can help your company to maintain FCRA compliancy and avoid having to fork out $50 gift cards to any potential employees.
Dot Your I’s and Cross Your T’s
As children we learn our ABC’s, and one of the first things we are taught is to always remember to cross our t’s and dot our i’s. As adults, we find ourselves in situations where this idea becomes less literal, but often times more important.
As a background screening company, VICTIG prides itself in our quick turnaround times. However, we also place greater emphasis on the importance of taking the time to be as accurate as possible on the manual checks that we conduct internally. Although we are all imperfect humans, we understand the importance of being as accurate as possible with the information we provide to our clients when it comes to their potential employees, tenants, etc.
Recently, a very large background screening company was in the news again for the wrong reason. In this particular instance, they violated the FCRA and twice misidentified a person as being someone else with a similar name. This particular person had a criminal history and had been convicted of aggravated battery. In the end, according to the Gainesville Sun in Florida, the misidentified victim was awarded nearly 3.6 million dollars in punitive damages.
One of the main advantages of using VICTIG as opposed to a “big box” background screening company is that we pride ourselves in having a “smaller company” mentality. We can give the attention to each of your orders that the Walmarts of background screening simply can’t provide. We do our very best to get to know our clients needs on an individual basis, thus being able to give the necessary attention that each of you require. We have a very diligent staff that works hard to avoid putting ourselves in similar unfavorable situations.
November 2016 VICTIG View
The Mad Scramble for Holiday Workers
According to an article by Roy Maurer on SHRM.org, “Employers planning to hire hundreds of thousands of holiday-season workers this year are expanding their talent aquisition channels and raising wages to fill jobs from a shrinking talent pool.”
Snagajob recently conducted a survey of 1,000 employers in the hospitality, retail, and restaurant industries. Ninety percent of those surveyed plan to hire seasonal workers. Those retailers that plan to hire the most seasonal workers probably won’t come to you by any sort of surprise; with the likes of Amazon, Walmart, and Target among those at the top of the list.
With the number of holiday-season workers expected to be between 640,000 and 690,000 for retailers only, HR departments, talent acquisition professionals, and background screening companies such as VICTIG will definitely have their work cut out for them over the next couple of months.
Have a fabulous November!
Team VICTIG
