Background checking is the process of authenticating the information supplied to a potential employer by a job applicant in his or her resume, application, interviews, and references. In most application processes, lying about their background and credentials will keep the employer from hiring the applicant. Hiring and recruiting are both time-consuming and costly investments. It is important to safeguard these investments by conducting a thorough background check. This short-term investment will always yield benefits in the long run.
The process usually takes between 3-10 days and charges between Rs 2000 and Rs 3000 per candidate. The fee goes up in case of extensive checks and for senior-level hires. The company runs a background check on one’s resume/CV, once all the interview rounds are qualified by the employee. An employee background check is a review of a person’s commercial, criminal, employment, and/or financial records. Many employers conduct background checks on job candidates. Some employers conduct checks after they have hired an employee. This is an investment as background checks help in safeguarding organizational assets, promoting safety at the workplace, reducing turnover owing to right hiring, safeguarding company reputation, avoiding legal action and inspiring confidence in customers and shareholders. Background checks help to ensure workplace safety by verifying the criminal records of the potential candidates.
As per the survey of the Executives involved in background verification, IT and ITES, banking and financial services and FMCG sectors are way ahead of their peers in other sectors such as telecommunications, manufacturing, retail, hospitality, healthcare, travel, education and entertainment. IT firms such as Tata Consultancy Services (TCS), Infosys Technologies, and Wipro are known to show zero-tolerance towards corporate fraud as well as fraudulent employees. Stringent actions including termination of services and blacklisting such candidates and recruiters are taken by them. The industry body for technology companies, the National Association of Software and Services Companies, maintains a centralized database of IT and ITES employees as well as third-party verified information on education, experience history and personal details of all these professionals.
Why do we need to verify the employee details before recruitment?
Background verification plays a crucial role in making better hiring decisions. 84% of employers continue to derive significant benefits from background checks. 53% of applications or resumes submitted by candidates to hiring managers contain at least one inaccuracy or lie. 84% of employers continue to derive significant benefits from background checks. The probability of hiring a wrong applicant is one out of every six (1:6) candidates who hold misrepresented records to induce you into offering them the job. There are many applicants who try to get hired by means of fake degrees and false employment records. Simple background verification would uncover these frauds and cease you from hiring the wrong applicant. The current scenario of Resume Fraud states 53% of all the job applications contain false detail according to the Society of Human Resources Management, while 9% of the applicants falsely affirmed that they had a college degree, listing false employers that didn’t even exist as per the survey conducted by Hubspot. An organization can lose $17,000 on average, says CareerBuilder, for a wrong hire or hiring someone with a false degree. The recruiting team doesn’t have any tool which could help them in mitigating it.
Below are some of the details that background verification agencies find in order to search for the employee who is the right fit for the company:
- Experience gaps
- Mismatch in the education received
- Discrepancies in the compensation
- Working in various unrelated industries
- Skill sets varying hugely
- Improve the quality of hires
- Fake degrees from unrecognized universities
- Certificate courses being passed off as degrees
- Protect the reputation of the company
- Prevent or reduce theft, fraud or any other criminal activity
- Safety is a major reason to conduct background and reference checks is to avoid harm or legal liability of any type to the employer or to others.
This includes harm to:
- Other employees via sexual harassment or workplace violence.
- The organization’s customers by sexual assault on business premises.
- The public due to negligent driving
- The employer’s business through financial loss or image/reputational issues.
- Defence of legal claims, such as negligent hiring
A multilevel jurisdictional criminal records search can be strong evidence that the employer exercised due care in hiring.
- Criminal Check: It is important to check the criminal records of individuals who own or who work with a third-party vendor.
- Discovering beforehand about the owner being involved in theft will save the hassle and worry about the same thing happening again.
- License Requirements: It is important to verify that all licenses are current and there has been no refusal of license or probationary periods due to any wrongdoings.
- Other Business Names: It is also a must to identify whether the third-party vendor is using alias names or the firm with a history of names has something to hide.
- Lawsuit or legal issues: It is required to check whether the employee is involved in any criminal cases.
- Motor vehicle records: Employers should always check the driving record of any individual operating an organization vehicle at any time or who will drive personal/ rental vehicles on company business. A motor vehicle record typically includes license status, license class, expiration date, traffic violations, arrests and convictions for driving under the influence, and license suspensions or cancellations.
BGV (background verification) can be done by accessing the information shared by the candidate or those available in the online space. There are various kinds of background checks, including business to business check (B2B) and business to consumer background check. (B2C). Third-party vendors fall into the category of a B2B check with these background checks including information on the creditworthiness of the company, work history, and verification of state certificates. A few agencies in India like First India Advantage, Mintly , Jantakhoj, AuthBridge, HireRight , and IDfy are specialized in background verification, known as third-party service providers.
When employers use a third party to check someone’s background, the Fair Credit Reporting Act (FCRA) restricts what they are allowed to check, and how. The FCRA is federal legislation that sets the standards for screening for employment. The FCRA defines a background check as a consumer report. Government firms or PSUs run an extensive verification before offering the job. They ask for Residential proof of where you lived more than six months, Proof of current local address and permanent address, Record from District Magistrates/ Police Commissioners of the areas where you lived. Further, either of those authorities asks police stations to run the check and finally, the record that police find is passed on the chain.
After ordering an employment background check report, turnaround time is a major factor since it's critical not only to how quickly an employer can fill seats but also to how quickly a promising candidate can be locked down. All vendors claim fast turnaround times, but in reality, these are estimates because every report is heavily affected by how quickly outside data resources respond to requests. Federal databases are fairly quick, but scans across county databases or municipal court records can take much longer. I found some of the vendors mapped completion to these dates, while others gave a short turnaround estimate and then sent status updates notifying me of delays.
If you're applying for a non-federal job, the background check will take about a week. If you're applying to a federal position, the background check can take a couple of months. Of course, these timeframes are for the background check itself. This process can be long, expensive and time-consuming, especially if a candidate has an extensive work history or has held multiple positions within a company. Waiting for callbacks from their past employers and making multiple attempts at reaching a company can make the hiring process more difficult and take longer than necessary. If you choose to use internal team members, such as your HR department, to verify a candidate’s employment history, the time it takes to complete the process will vary based on several factors, including:
- How many applicants you are screening
- How many team members are working on the verifications
- How many jobs each applicant has to verify
- How easy it is to obtain correct contact information for their past jobs
- How fast an applicant’s past employers provide you with the information
A background check can range from a simple verification of your social security number to a much more thorough check into your history. Information that an employer might check can include your work history, credit, driving records, criminal records, vehicle registration, court records, compensation, bankruptcy, medical records, references, property ownership, drug test results, military records, and sex offender information. Employers can also conduct a character check, which might involve speaking with your personal acquaintances, including friends and neighbours. Employee Background Verification includes:
Public records: These can easily be accessed from the court records, criminal history, Global database, and adverse media by any law enforcement agency.
Identity check: This can be accessed online in a span of typically 2 days through the Government database or online repositories, including Passport, Aadhaar, PAN, etc.
Credit check: A credit check may also take 24 to 48 hours to complete. It involves a search of credit bureau records and is designed to provide an overview of the candidate’s credit history.
Employment and Reference check: It can be obtained from one’s past employers, Duration of being hired with them, Job role in each company, Pay, Performance history, Conduct in the company, Medical history. One can reach out to previous employers or managers over e-mail or telephone as the preferred means. It typically takes 2-3 business days.
Professional qualifications verification: Professional qualifications may include trade organization memberships, as well as certifications and licensure. It usually takes an average of two business days to complete this kind of work. Sectors that majorly run a professional license background check include:
- Home contractors, including electricians, builders, and plumbers
- Education, including college professors and administrators
- Banking and insurance
Education records: Companies will reach out to your universities to match your credentials to avoid forging degrees, fake certificates, bogus grades- the most common types of corporate frauds. It typically takes 2-4 business days to generate the report. Most institutions will confirm when the candidate was a student and what degrees were earned, though some will require a release form before sharing that kind of information.
Address verification: It is done by sending people to physical locations to check out a candidate’s address with geotagging of photos. Big private companies hire third-party agencies to do everything mentioned above. While smaller firms usually depend on their internal team of HRs for background verification of employees recruited.
Criminal checks: The time frame varies significantly, depending on where you’re doing the hiring. In the United States, criminal searches are generally completed one to two business days, barring holidays, or Court staffing issues. Candidates with histories outside of the United States could have a criminal records search that takes anywhere from three to 30 business days, depending on the authorities involved and the process that they follow conducting the check before returning the results. These processes may include manual record checking, liaising with authorities across the country or in-depth research when multiple matches are identified. Generally speaking though, a criminal records check outside the United States takes between ten and 20 days.
The HR team which takes care of the background verification process has a powerful tool that they can use to learn a lot about a job applicant- social media handles. The social media handle often serves as a tool to give out vital information about the employee. It is easy for the employer to map out the interests, activities, and affiliations of the applicant. Inappropriate contents such as racist and homophobic slurs may work against the applicant. There are no laws that require companies from scanning the social media handles of candidates.
The jewelry business is faced with the challenge of hiring and retaining a wide range of high quality and honest employees. Employees often work without a coworker or supervisor on site. In the face of sometimes minimal pay and many opportunities to access company property and funds, the need for a quality pre-employment background check is evident.
A thorough criminal records background check is an employers first line of defense in protecting the company’s assets, fellow employees and customers. Communications skills are critical for establishing good relationships with clients and colleagues, for getting necessary background information from customers and for developing new business. Various jewelry sector jobs look into following before hiring:
- Background Checks: These typically run seven years or more into a job candidate's history, but can go back further if circumstances warrant.
- Access Restrictions: Controlling access to inventory rooms and display cases is important for loss prevention. The fewer people touching merchandise, the easier it is to identify responsible parties when something goes missing. Restricting access may take the form of issuing display case keys or implementing key-card access to inventory rooms. Restrict access to essential personnel using the most cost-effective tools available.
- Metals Testing: Jewelers often buy precious metals from the public, which requires them to test the items customers bring in for authenticity. Non-destructive x-rays and fire assay testing are among the methods used. Trusted personnel should be trained on testing methods and required to test pieces before finalizing transactions.
- Identity Verification: Fraudsters often try to use fake information or credit card chargebacks to steal from jewelers. Verifying a customer's identity and personal information is an effective control method in preventing theft. Avoiding chargebacks can save jewelers thousands of dollars in lost merchandise.
Automation: Apart from phone-based reference interviews, screening firms and employers are using advanced technology to improve the results of reference checks. Some screening firms offer online solutions that enable a broad set of reference sources to respond quickly and confidentially. While few believe that online reference checking does not enable a hiring manager or screening professional to ask probing questions in an interactive fashion. Though this is true, requesters always have the option to call and ask follow-up questions about candidates after reading the initial report.
Agility: With the advent of technologies, various tools have been used, making the process more agile, seamless, and transparent. Aadhaar verification by National Academics Depository (NAD) – The government launched the NAD tool that digitally stores your education records and can issue reliable certificates to verified users as they plan to have every education board and institution in India on-board. National Skills Registry (NSR) – NSR is the largest database of working professionals that helps the company’s fact-check employees’ information.
Globalization: Pre-employment screening is becoming more complex as organizations increasingly look to overseas job markets with the advent of globalization. It is now common for a job applicant to have been raised and educated in as well as to have worked in several different countries. Employers recognize that candidate screening at all levels is more complex and vital to organizational well-being. Multinational employers thus must be careful to obey local laws concerning background checks.
Remote Employees and Hiring: The onset of COVID-19 changed everything for employers, especially since much of the workforce shifted to telecommuting during 2020, and this trend is likely to continue in 2021 and beyond. When hiring remote workers, it’s more important than ever for companies to properly screen their employees since monitoring and managing remote workers can present unique challenges, especially in high security situations. Additionally, COVID-19 has created a need for companies to be able to hire employees virtually with little to no face-to-face interaction for interviews, paperwork, etc.
“Ban the Box” Legislation Continues: Info Cubic’s analysis indicates that “Ban the Box” and Second Chance laws will continue to expand across more states and cities in the United States in 2021 and beyond. The “Ban the Box” movement is growing quickly. As of early 2021, there is “Ban the Box” legislation in 17 states and territories as well as the District of Columbia, which provide varying restrictions on employers inquiring into a candidate’s criminal history. These laws remove the “checkbox” in a typical employment application that asks candidates about their criminal history, which helps applicants with criminal records move past initial hiring stages, or otherwise restrict employers from inquiring about criminal history at certain times throughout the application and interview process. Many ordinances still allow employers to consider convictions later in the process, particularly if criminal history has implications for the position.
Social Media Screening continues to increase: Including social media as part of employee background checks is a hotly contested issue. A screen of an applicant’s social media accounts can be a useful screening tool. However, it can also create a host of potential liability issues if not processed according to the Fair Credit Reporting Act (FCRA) and Equal Employment Opportunity (EEOC) guidelines. Social media screens can provide a wealth of information about an individual’s social habits. These screens can also provide misinformation that steers HR employees down the wrong path. In addition, some states have already passed legislation that prohibits employers from requiring potential or current employees to share their social media information.
Recruiting as a Top Concern: Due to the slow job market and low employee turnover during the COVID-19 pandemic, employers should expect to see a huge uptick in the number of job candidates in 2021. Employers will need to search through many job applications, which means they need to have efficient hiring processes in place in order to find and secure the top candidates for their open positions. We recommend seeking out partners that offer applicant-friendly, efficient, mobile-friendly platforms to ease the hiring crunch.
Achieving Pay Equity through Salary History Bans: There is an ongoing focus to achieve pay equity between men and women and among ethnic groups. Proponents of this mission feel that banning salary history inquiries during the interviews and the employment screening process helps accomplish this goal. Achieving pay equity is a national trend that continues to expand, as more cities and states introduce pay equity legislation to lessen the gender pay gap. While legislation around pay equity decreased slightly in 2020,the goal of achieving salary equity remains front and center. As of January 2021, many states have already enacted bans on requesting salary history as a criterion for hiring or promotion. There has been recent legislation passed with regard to pay equity and salary history passed in the states of Colorado, Maryland, New Jersey and New York as well as the cities of Cincinnati, Ohio and Toledo, Ohio.
Gig Workers on the Rise: During the pandemic, more workers have turned to “gig” or freelance work. In the past, employers haven’t bothered with the hassle of screening a gig employee, but that is changing. In 2021, we can see HR focusing on gig economy screening as closely as they do regular employees. The “gig economy” has exploded over the past few years—most notably with transportation services such as Uber and Lyft. According to a report from Intuit, 7.6 million people will be part of the on demand gig this year, and that slice of the labor market will grow by 18.5% per year over the next 5 years. Bad publicity regarding the safety of consumers, however, has caused these companies to begin taking background checks more seriously.
Check the latest trends in detail here . The entire guide is made available on https://www.springworks.in/blog/employee-background-check-guide .
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