Small Business Employee Background ChecksIn today’s litigious world, small business employee background checks have become ubiquitous. In addition to possible legal consequences, pre-employment drug and criminal background verification have become commonplace. 

In general, the majority of small business owners are a bit hesitant to conduct pre-employment background checks. A myriad of unique factors plays a part in shaping the average small business owner’s decision to forego or reluctantly hold a pre-employment background check. More often than not, performing such a check proves to be a prudent measure. Let’s take a look at the pros and cons of conducting pre-employment background checks for those seeking work at small businesses.

Small Business Employee Background Checks: Critical Considerations

Cost of pre-employment background verification

Small business owners who perform DIY style pre-employment background checks on prospective employees often ally with websites that charge as little as $10 per investigation. Alternatively, small business owners who ally with full-service pre-employment background check providers usually pay exorbitant fees in the range of several hundreds of dollars per research. There is an element of risk in opting for the cheaper DIY route as the search might not adhere to the rules of the Fair Credit Reporting Act (FCRA). Low-Cost reports can provide critically essential insights that won’t bust a small business’s budget.

Administrative Burden of Employment Background Checks

The average small business does not have the workforce or resources necessary to conduct a thorough background check on all job applicants. Though DIY, web-based providers exist, the small business is still tasked with performing nearly all of the investigative work when allying with such “bare bones” websites. If your small business lacks the resources necessary to conduct such investigations, consider allying with a full-service provider who will bear the brunt of the administrative burden. This way, you’ll be provided with an organized pre-employment background check report that meets your nuanced specifications. All you have to do is review the results and make the appropriate hiring decision.

Avoiding Potential Wrong Hires

The best reason for a small business to conduct pre-employment background checks is to pinpoint candidates who are worthy or unworthy of a job offer. An accurate pre-employment background check can provide insight regarding a candidate’s employment history, criminal record, educational accomplishments, credit rating and all sorts of other vital data used in the hiring process. Conducting such a check helps a small business make an educated decision when selecting from a pool of seemingly equally qualified candidates. Consider the potential ramifications of hiring the wrong candidate. He might steal from the business, perform below expectations or even create an unsafe work environment for co-workers and customers.

The Prospect of Inaccurate Pre-employment Background Check Results

Though DIY style pre-employment background check sites are cheap, they often produce false data that is used to rule candidates out of consideration for open positions. If inaccurate data gleaned from such a background check serves as the basis for rejection, the spurned applicant has grounds to sue the small business. Furthermore, many of these low-cost websites do not comply with the rules of the Fair Credit Reporting Act (FCRA), opening the small business up to the threat of a lawsuit. This is precisely why some small business owners and managers refuse to conduct pre-employment background checks. However, it must be noted that nearly all full-service pre-employment background check providers are in full compliance with the FCRA. The data uncovered by these providers might be expensive to obtain the accuracy of such information yet tends to be nearly flawless.

Small Business Employee Background Checks Cause Delays

At times, small businesses require a warm body for open positions. Others need forthright candidates who do not have blemishes on their credit report, employment history, and criminal record. As an example, a small landscaping company in search of a laborer might not find it prudent to conduct a pre-employment background check. Alternatively, a small business operating in the financial, hospitality, healthcare, commercial service or property management sector should give strong consideration to running pre-employment background checks on most or all job candidates. The nature of the open position’s work is often the deciding factor. If the new hire will be handling money, entering homes to perform repairs or caring for the sick/elderly, performing a pre-employment background check is an absolute must. The responsibilities associated with these positions are a stark contrast to those of a laborer like a landscaper who unloads materials from a truck and spends his day under the sun, laying down soil and trimming shrubs.

The Prospect of Negligent Hiring

One of the best reasons to perform a pre-employment background check on job candidates is to prevent claims of negligent hiring. This legal term refers to a business’s liability for a happening caused by a worker when the employer either knew or should have known that the employee posed a legitimate risk. Conducting the background check after making a conditional offer of employment and before the new hire starts working might significantly reduce the odds of a negligent hiring accusation. Avoiding such a charge will save a small business owner plenty of money in litigation costs.

There are both pros and cons to conducting small business employee background checks. The fundamental question remains on how to remain compliant to labor, immigration, and other laws while also minimizing the burdens and cost on your small business.

Disclaimer: small business employee background checks is an informational article. While we strive to provide quality information, we cannot guarantee the accuracy of the data. Please consult an attorney for what is right for your business in conducting and using the data from pre-employment background checks.