Posted By:

Cheryl Miles on November 12, 2015

Employee Background Checks: Are They Necessary?

The ease in which job applicants can falsify information and cover up a sketchy background has created a need for business owners to protect their company as well as existing employees. One way that employers screen job applicants and minimize their liability is to perform employee background checks. With technology making it easier than ever, this practice is becoming increasingly common within numerous industries. But are employee background checks really necessary and right for your business?


What Does a Background Check Entail?

There are several types of employee background checks — and employers can access a lot of different information depending upon their needs and the position being filled. Some common types of background checks include:

  • Criminal
  • Educational
  • Medical
  • Credit

In terms of where information is accessed from, it can come from multiple sources including federal, state and local governments, educational institutions, past employers, professional organizations and personal references.


The Pros

  • Increased Quality of New Hires – When job applicants know that they will be screened, it tends to work as a natural filter, and you can often weed out unsavory individuals. In turn, this improves the quality of your talent pool, and you’re more likely to find employees who are ethical and have clean backgrounds.
  • Create a Safer Working Environment – If you hire a person with a criminal background or a history of substance abuse, it’s likely to result in a more dangerous working environment for your other employees. This could have disastrous consequences like an increased likelihood of workplace violence or internal theft. However, running employee background checks should reduce the chances of this type of activity happening.
  • Reduce Liability – If you run a business where employees have access to sensitive information, care for children/elderly people or handle hazardous materials, you could find yourself in hot water if you hire someone with a checkered past. Screening new applicants should help you avoid hiring the wrong person and therefore reduce your liability.


The Cons

  • Cost – Perhaps the biggest drawback is the added expense of running employee background checks. With the average cost to a hiring company ranging between $150 to $180, this may simply not be in the cards for many businesses.
  • Potentially Flawed Data – Another issue is that you can’t always be 100% certain that the results are accurate. Whether it’s because of a misspelled name, incorrect birth date, a mistake in the verification process or any other factor, there’s always the potential for flawed data.
  • Potential EEOC Complications – One problem that may not be so obvious involves the Equal Employment Opportunity Commission (EEOC) and the federal laws that are in place to prevent workplace discrimination. If you’re ever suspected of rejecting an applicant on an unfair basis, it can open a can of worms and potentially result in litigation. For more information on this topic, you can check out the EEOC’s website.


How to Go About It

If you’re interested in performing employee background checks, there are a plethora of software platforms that will allow you to do it. This list from BizBrain highlights 15 different services so you can contrast and compare. Another option is to outsource employee screening to a human resources outsourcing firm and let them take care of it for you.

Deciding whether or not to implement this process into your hiring procedures depends on your priorities and the needs of your business. While it makes sense for many employers, it’s not necessary for everyone.

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