Gaps in Small Business Background Checks [5 Costly Mistakes Employers Can’t Afford to Make]

  •  02/15/2021
  • By Andrea Collatz
  •  Employer

Like many small business owners, you might be in desperate need of a great hire, and you need to hire that person fast.

Sure, you want to see a textbook resume, glowing references, and an infectious personality that makes you excited about bringing them on board. But you’re crunched for time and might consider skipping important applicant vetting steps and simply rely on your gut instinct so you can get back to business quickly.

But, can your instinct really be trusted?

When it comes to building a strong team for your small business, going with a “good-gut-feeling” can just end up slowing you down. Like a scientist relying on empirical data for a strong conclusion, it’s imperative that you make your final hiring decision based on all of the pertinent data you can get access to.

Without a proper employment screening process, you might not realize that your “ideal” candidate may have:

  • A relevant criminal background
  • An unhealthy credit report
  • Fabricated their identity
  • Claimed a diploma or certification that was never received
  • Listed companies, jobs or tenures within their resume that are inaccurate

Although most job applicants are not approaching your business with outright malicious intent, there are applicants who misrepresent their personal information, experience or qualifications. When you’re busy dealing with adapting to huge changes in how business gets done, the last thing you want to worry about is someone not being as qualified as they say.

The cost of a misjudged hire can cost employers an average of $17,000. This is why it’s essential to protect your staff and your bottom line with a clearly defined hiring process that includes screening with a reputable, employment background screening service, like ShareAble® for Hires.

Learn more about employment screening

According to a TransUnion survey, 97% of small business owners say they do some sort of screening, and 45% use a paid pre-employment screening service.

45% of small businesses use a paid screening service for new hires

Having a streamlined pre-employment screening process in place can help provide a variety of benefits to your small business, including:

  • Faster hiring
  • Improved employee retention
  • Reduced risk of litigation
  • Increased productivity

According to Glassdoor, when small businesses use a good employee screening process, it can help improve the quality of their hires by 70 percent—and every percent counts during uncertain times.

Small businesses are aware of potential dangers of hiring the wrong person. But by nature, small businesses often do not have the resources, streamlined screening procedures, or organization of large corporations. This can put them at disadvantage. Either they could overlook screening as being vital or not get access to tools that can help them properly vet their candidates, which could lead to disastrous results.

Note: Small business owners shouldn’t have to jump through hoops to gain access to an FCRA-compliant employment background screening tool. ShareAble for Hires is built for small businesses and thousands of small business owners in many industries have successfully screened with ShareAble.

Common Background Check Errors Small Businesses Make

Gap #1: Performing DIY Screening to Save Money

To help make a confident hire, employers and hiring managers need to access all available and pertinent information on the applicant. However, not all employers know the most efficient or best ways to screen employees.

Instead of paying a small fee for a streamlined, online employment background check, some employers opt to save money (and waste time) by tracking down free public records and scouring social media.

There can be significant drawbacks to these tactics.

  • Online public record checks: There are plenty of risks related to using online public record checks alone to screen employees. The Fair Credit Reporting Act (FCRA) generally requires more, and a limited search of public records could result in serious legal consequences that could bankrupt a small business. Online public records can be incomplete, inaccurate, and neglect to provide the information a small business owner needs to make a confident hiring decision.
  • Social media: Some employers report using social media to screen candidates before hiring. While this tactic may appear to be quick and harmless, this may not be a wise choice for your small business. Social media screening may reveal information about a candidate, including age, race, nationality, disabilities, gender, or religion. It’s important to note that all of these characteristics are generally protected under the FCRA; if any of these characteristics bias your hiring decision, then you may find yourself in legal trouble or even slapped with a discrimination lawsuit.

Tips for getting crucial information: With ShareAble for Hires, your business screens with confidence knowing you’re receiving the information you need to run an industry-best, reliable, and FCRA-compliant report. Spending a small amount of money upfront with a legitimate employment screening service is fairly considered to be better than potentially spending thousands in an employment lawsuit down the line. Instead of trying to manage the process yourself by hunting down public records or evaluating candidate activity on their social media, ShareAble offers a high-quality way to quickly screen applicants. Itis a pay-as-you-go option that includes all of the essential information, including employment credit checks, financial history, criminal history, and identity verification.

Gap #2: Failing to Follow FCRA Regulations

Employment screening is generally subject to a variety of laws and regulations. Employers who fail to get the applicant’s explicit consent to be screened or fail to provide a standard adverse action notice if it makes a decision to hire the applicant or meet other FCRA requirements can face costly consequences.

Understanding and being compliant with FCRA rules and regulations is one of the major keys to running a successful business. You must seriously consider ensuring that your background screening processes don’t violate a job candidate’s rights. While studying-up on FCRA regulations may sound like an easy task, it can be complex.

Tips for following FCRA regulations: To help keep things simple and safe for you, ShareAble for Hires provides FCRA-compliant online employment background reports. Don’t unnecessarily put your business at risk for a lawsuit. When deciding on a screening process or service, you should make sure that whatever you do is compliant with applicable laws, including the FCRA. It is encouraged to check with legal counsel to verify that your screening process follows all applicable laws – specifically FCRA regulations.

Gap #3: Neglecting to Screen Every New Hire

Which employees should you screen? The answer is easy: all of them. Employers who fail to screen temporary employees, part-time workers, or even interns may be putting their organization at risk. Every new hire should be vetted the same to help protect your small business, customers, and employees.

Additionally, run background checks on the following types of workers:

  • Interns: Don’t forgo employment screening just because someone isn’t a “real” employee. While an internship program may only last a couple of months, a bad intern hire can have lasting consequences. In many cases, interns are trained to become full-time employees down the road. If you do decide to add an intern to your permanent roster, previous employment screening can expedite the process.
  • Remote workers or freelancers: The remote workforce is growing, especially in the wake of the global pandemic. If you hire remote workers, screen thoroughly to protect your organization—a person doesn’t need to be in the office to find a way to wreak havoc.

boss discussing work with remote employees

Note: The above list is not exhaustive and certain hires may fall under special hiring regulations. Be sure to connect with legal counsel on this matter before making any decisions.

Tips for screening new hires:

  1. It may help to create a comprehensive screening policy that is used for every person you hire, from full-time employees to interns.
  2. Choose your background screening service that gives you quick access to tools - ShareAble for Hires is designed to be accessible immediately for every small business.
  3. Be sure that any individual with access to your company information, clients, customers, or employees is screened in the same manner as full-time, in-house employees.

Gap #4: Forgetting to Verify Someone’s Identity

Identity theft is a growing problem that can negatively affect your business and cause major administrative headaches.

An identity check can help confirm that your applicant is who they say they are to help reduce the risk of identity fraud in your company. As a business owner, you need to be certain that the candidate you’re interviewing is the person that they claim to be. If a job applicant is lying about his or her identity, then they may be misleading you and your hiring team in other ways, too.

identity theft

It’s also important to verify an applicant’s identity in order to get the correct background check results. Mixing up the identity of a job applicant with another individual affects the efficacy of your background check, as you’ll obtain false, inaccurate, or incomplete information.

Tips: Make online identity checks a streamlined part of your screening process. Include identity checks for every prospective recruit and use a reputable screening service, like ShareAble for Hires. ShareAble pulls results from numerous databases to help determine if your applicant’s self-reported information is a match. ShareAble for Hires not only makes this an almost instant process, but it also sends the reports to both you and your applicant for total transparency.

Gap #5: Taking Too Long to Screen Candidates

Employers who are slow to screen prospective employees may miss out on top talent. In short: it matters how long your background checks will take to complete, as slow processes can mean losing a great candidate to a company that can expedite hiring.

Some background check services impose restrictions on businesses that want to conduct employment screening, causing significant delays before you can screen. You might have to fill out an application to become a customer or speak to a salesperson to get started. Your application can take hours or days to be approved. Worse yet, your application might be rejected, excluding you from getting access to screening tools at all.

High-quality candidates that are in demand will only wait so long. Another company could extend a job offer while you’re waiting around.

Don’t miss out on top talent with a slow and cumbersome background check, as this screening mistake can mean letting the perfect hire slip through the cracks.

Tips for speeding up your hiring processes: While traditional background checks can take weeks to complete, ShareAble provides nearly instant results so you can hire more quickly. As a small business owner, you should never have to worry about missing out on a great hire because you’re too busy jumping through employment screening hoops.

ShareAble for Hires is designed to be fast and make screening employees easy. Screening can be done all online and completed same day. Reports are delivered to you within minutes.

SMBs can use ShareAble for Hires at any time, anywhere to run employment checks.

  • No outdated application process
  • No tedious paperwork
  • No need to call to sign up
  • No waiting to screen
  • No delay to get your reports

When you are ready to screen, ShareAble expedites the process by delivering nearly instant background information, credit history, and identification reports.

Avoid Common Background Check Mistakes and Screen with ShareAble for Hires

Bringing on a new hire can be a bit like a lab experiment. With all the possible hazards that come from common mistakes in the screening process, it doesn’t take a rocket scientist to see the need for high-quality, comprehensive employee background checks when hiring for any position—especially if you need to hire on-the-spot.

Created specifically for small businesses, ShareAble for Hires offers thorough, online employee background screening in minutes. All reports are delivered by TransUnion, a credit reporting agency with over four decades of experience. This means the reports are both trustworthy and compliant with federal regulations.

In addition to providing you an applicant’s criminal background checks for employment and identity verification reports, ShareAble fore Hire delivers a credit history report, which is especially useful if your applicant will be handling money or overseeing sensitive financial information.

While owning a small business sometimes means finding creative solutions to save money, it never pays to shortchange your background screening.

Fill the gaps for a more comprehensive glimpse into the person you’re bringing on board. The safety of your livelihood, workers, and customers is in the balance. Sign-up for free and get immediate access to screening tools to fast-track your process and make your next hire on the spot with ShareAble for Hires today!

Signup with Shareable for Hires Today for Free

Senior Marketing Analyst, TransUnion ShareAble

Andrea Collatz

She focuses on topics that empower small business owners through data, insights and industry best practices.

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