As the threat of COVID-19 slows, the retail and hospitality industry has begun to reopen their doors to the public.
With this comes the essential task of hiring new employees.
Customer-facing employees, especially in this industry, are generally seen as the face of a company — they greet and aid customers and have a strong understanding of everyday operations. These are the people that make or break a customer’s in-store experience.
Customer-facing employees contribute a fair amount to a company’s image, and it is therefore important to hire responsible people. If employees are not properly screened, serious threats can present themselves.
Threats to Retail & Hospitality
The largest threats to the retail and hospitality industry often include:
Roughly 43% of inventory loss can be attributed to employee theft, 37% to shoplifting, and the remaining 20% to administrative errors and supplier fraud. Shrinkage costs the U.S. economy nearly $50 billion annually.
Customer Data Breaches
The average cost of a data breach is $3.5 million per breach plus reputational damages, which are even more difficult to remedy. 15-20% of the time, the breach was caused by a trusted insider. In a 2013 Ponemon Institute Survey, 43% of respondents had experienced at least one malicious, deliberate insider incident in the previous year.
Employee Drug Use
Especially for establishments like hotels and amusement parks, guest safety and employee training are very important—and tightly intertwined. Employee drug abuse, especially on company time, can degrade a customer’s experience both socially and physically, cause tardiness and missed shifts, decrease productivity, and foster a low workplace morale. There can also be negative impacts on operating costs and profitability.
High Turnover Rates
The retail and hospitality industry usually has about a 34% turnover rate, whereas the national average is 15%. This higher turnover rate is largely due to fluctuations based on seasonal demand. Companies in this industry need to be able to hire a lot of people quickly with minimal risk.
Background checks minimize the above threats by vetting every candidate before they are hired, which dramatically decreases the amount of time, money, and other resources that organizations would otherwise divert to threat management.
Types of Background Checks
Some of the most common background screenings in retail and hospitality include:
- National Criminal Search: a database of criminal convictions across the country.
- County Criminal Felony & Misdemeanor (F&M) Searches: returns searches multiple courts for felony and misdemeanor charges. There are many different types, so choose one that is the best fit for your company.
- Sex Offender Search: returns searches from sex offender databases.
- Motor Vehicle Registration (MVR): returns searches for driver's license information, vehicle information and registration, convictions, violations, accidents, and more.
- Employment/ Education Verifications: searches for employer/ educator’s name and address, dates employed/ educated, position, termination type, and more.
- Worksite enforcement, or the legal eligibility to work in the U.S.: includes I-9 completion and the E-Verify program through the Social Security Administration (SSA) and Department of Homeland Security (DHS) databases.
There are several types of drug tests including urine, oral fluids, and breath alcohol tests (BATs), which can be rapid or lab-based, self-collection or conventional-collection. Again, consider what is best for your company’s purposes.
Each of the above tests vary from state to state, so make sure you are complying with specific state and local laws.
The Fair Credit Reporting Act (FCRA), a federal law that protects the accuracy and privacy of personal credit reports, should also be taken under consideration.
Employment Screening Packages
With all this in mind, how do you find the best employees?
One of the best, most secure ways is to work with a trusted screening company. A screening company’s job is to mitigate financial, safety, and reputational risks in and after the hiring process while using your company’s time, money, and other resources as efficiently as possible.
A good screening company will search web-based files, like the ones described above, and hard-copy records that can only be accessed through a clerk.
Creating a good employment screening package includes choosing which screening tests you’d like to run, specifying how your HR department should operate, and conducting review meetings to monitor your success. Screening companies can help you design and maintain such a package.
How ScoutLogic Can Help
After assessing your company’s needs, ScoutLogic will create and implement an employment screening package for you. We have the ability to run all of the aforementioned tests and we will update you in real-time following each report.
To do this, we pair you with professional background screeners or a “Scout” team. Our Scout teams work with your company as an addition to your HR department to get you better, faster screening results and to ensure a line of direct communication.
For ease of use, ScoutLogic’s services can also be integrated with an applicant tracking system (ATS) like iCIMS, Oracle, Greenhouse, and more.
Let ScoutLogic handle the details so you can focus on hiring the best candidates.