Because a company’s greatest asset is its employees, it makes sense to hire the best possible employees to achieve business success. As organizational management expert and author Jim Collins stated in his book Good to Great, “Get the right people on the bus, and in the right seats.” Securing the best employee results for most U.S. companies includes the use of employee background checks.
What Are Employee Background Checks?
Employee background checks have become the norm in American businesses. In fact, according to the Society for Human Resource Management (SHRM), about 96% of American businesses conduct some form of pre-employment background screening.
A background check is typically done after a candidate has been finalized and before an employment contract is signed. It is an activity through which public and private records of an individual are inspected. The items included in a background check will depend on the nature of the job, the level of exposure to sensitive company information, and the level of background check required. Employee background checks conducted before an individual’s employment save time, money, and problems that could occur later.
There are several types of employee background checks that are typically used by hiring managers:
- Identity verification. This is used to ensure that a potential employee is who they say they are, and includes verifying their name, any aliases, date of birth, social security number, and their address.
- Criminal background check.
- Motor vehicle records (if employees will drive company vehicles or transport clients).
- Professional licenses and educational records.
- Job history background check.
- Professional and personal references.
Why Businesses Should Run Employee Background Checks
Businesses should run employee background checks before hiring someone for several reasons. First, to make better-informed decisions about employees, including their skills, potential for growth, and their fit with the organization. This will help ensure a stronger overall organization and save money by avoiding costly turnover, re-hiring, and re-training. Second, to reduce risk by identifying potential safety or legal liabilities, thus creating a safer environment. Third, to maintain regulatory compliance. Fourth, to protect confidential information. Fifth, to protect the organization’s brand by hiring qualified and trustworthy individuals.
Things to Know About Effectively Running Employee Background Checks
- Develop a written policy that outlines all appropriate procedures.
- Obtain legal counsel in writing regarding your background check policy.
- Once a thorough policy is written and sanctioned, share it transparently with all departments and existing employees to ensure buy-in.
- Work with an experienced background check firm. Choose a company that you can trust as your partner and ensure that they are compliant with the Federal Credit Reporting Act (FCRA) requirements.
As the background check policy is used, ensure that it is applied consistently and fairly. Maintain proper records of background check information and ensure confidentiality. Document every step of the process to protect your company from liability or legal issues. Engage your professional payroll and management reporting company to assist you.
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