Are background checks necessary?
A recurring conversation we have with many of our clients involves whether they should run background checks on their current and potential employees. Often this turns into a discussion about what are the best practices, guidelines, and rationale behind seeking background information on employees. A few common reasons we’ve found for why employers run background checks are:
- To ensure a theft free workplace. Especially in the retail industry where 42.9 percent of retail lost in the U.S. was attributed to fraud or theft from employees.
- To reduce legal liability for negligent hiring.
- To keep a safe work environment and minimize potential threats for employees.
Given these reasons, it seems like running background checks should be a no-brainer. However, we suggest that employers keep in mind the cost of background screening every employee. It may not always be necessary or make good business sense to spend the money on numerous background checks. For example, employers with high employee turnover rates might want to consider only paying for background checks on management or high-level staff.
Another thing to keep in mind is that there are different types of background checks. Make sure to look for the most relevant information when background searching employees. For instance, if you mostly employ CDL drivers, it is probably more cost-effective to check their driving record than their credit.
The most common types of background checks include:
- Criminal check
- Credit check
- Reference check
- Drug screening check
- Driving record check
Finally, every employer should have a policy in place for their background screening procedure and this policy should be made readily available to employees. Check out Part 2 to learn basic laws and guidelines you need to follow if you decide to seek background information on your employees.