4 Reasons Why Your Business Needs Background Checks as Part of Your Hiring Process
Background checks have not always been a standard part of hiring. However, in today’s modern, fast-paced environment, these checks are now becoming routine for the vast majority of employers. 94% of all employers require employees to undergo a background check during the hiring process.
The majority of employers now conduct background checks because these checks provide many benefits to the company and can improve the hiring process. Four of the biggest benefits employers experience from requiring background checks include:
- To bring objectivity to the hiring process: Many job applicants have a captivating personality, which can cause employers to overlook other major issues related to a lack of experience or education. They may even overlook some red flags. However, requiring background checks provides an opportunity to bring objectivity to the process. These checks, particularly criminal background checks, can rule out certain candidates based on facts from their past, previous employment, education, and experience. And this process ensures that you won’t fall into the trap of trusting a candidate at face value since only the highest quality candidates will make it through these verifications. You can rest easy knowing that the candidate you hire has a proven record and will likely be an exceptional addition to your company. Repeatedly making good hiring decisions can also increase your productivity, reputation, and efficiency, which tremendously benefits your business.
- To reduce your expenses: When initially exploring the option of conducting background checks, many employers note that these checks require resources, including time and money. But these funds can bring a strong ROI by reducing many other expenses in the long run. Hiring comes with many costs, including recruitment activities, training, wages, and benefits. If you hire the wrong candidates, you can invest a lot of money into someone who may not stick around for long. And after all of this investment, you have to start over again and make the same investment in another person. Background checks help you feel confident that you are hiring the right people, which can reduce turnover and the amount you must expend related to recruitment. Additionally, criminal background checks can prevent you from hiring risky employees, which can lead to other expensive results, such as:
- Higher insurance premiums
- Employee theft
- Higher absenteeism and lower productivity
- Increased risk in accidents and workers’ compensation claims
- Risks and liability that come with negligent hiring and potential legal action resulting from it
- Enhance workplace safety: Criminal background checks can reveal potential convictions where a candidate has been violent or engaged in other adverse behavior, such as terrorism or stalking. Additionally, background checks can reveal whether candidates have a history of maintaining compliance and safety standards with former employers. With this information, you can make hiring decisions that enhance workplace safety and reduce the risk of adverse actions. In addition to general employers, some industries also require a higher level of background checks or criminal background checks because they work with vulnerable populations. In these industries, maintaining a safe workplace is paramount since hiring the wrong person could jeopardize the safety of clients and other employees. Industries with more stringent requirements include healthcare, finance, transportation, education, engineering, and industrial.
- To help maintain compliance: Conducting background checks allows your company to reduce risk related to fines, fees, and lawsuits. Additionally, some industries require additional licensure or qualifications in some industries. These checks verify that you will remain compliant and reduce your risk exposure related to noncompliance within your industry.
While background checks provide many benefits for employers, they can be difficult to conduct. All companies conducting background checks must comply with regulations outlined in the Fair Credit Reporting Act (FCRA) or face federal fines and lawsuits. At a minimum, the FCRA requires that employers conducting background checks do the following:
- Only conduct the check for an approved reason – in addition to employment, background checks are permissible for seeking credit, tenant screening, licensure, child support orders, or insurance.
- Provide a clear disclosure in writing.
- Obtain written authorization in a standalone document from the candidate granting permission to perform the background check.
- Follow the adverse action process (which includes many additional requirements) if denying employment due to information obtained in the background check.
Many states also have additional laws or regulations impacting background checks, especially criminal background checks. For these reasons, ensuring compliance throughout the background check process can be challenging. To learn more about criminal background checks and compliance, please contact USA Fact today.
USA Fact Global Screening Services provides comprehensive background and criminal checks for employers that comply with federal and local laws. By helping you eliminate high-risk applicants through tailored solutions, USAFact enables you to create a safe and productive work environment and a foundation for future success.