Why $10 Background Checks Are Bad For Your Business

With employment costs rising, talent acquisition professionals are always looking for ways to reduce costs. Background checks can be expensive depending on the type of check components and the residence history of the candidate.

So, when you or your CHRO sees an advertisement for “$10 background checks that return instantly!”, you can get pretty excited about dramatically reducing your costs and getting checks back within minutes.

Unfortunately, like many things in life, you get what you pay for and, in this case, you may be setting yourself up for a lawsuit.

What Is a $10 Background Check?

A $10, or less, background check is typically a National Criminal File check. However, this is simply a database of scraped records that come from counties that have electronic records that are publicly available online.

These services will also include information from other, valuable sources too, including sex offender registries, terrorist watchlists, and other financial sanction databases.

This is not in any way a “federal” government database. It is typically just a collection of data that a private business aggregates and sells to background check companies for them to resell to end employers.

These databases are not comprehensive

These checks are often missing large parts of the United States, including counties around urban areas.

So, if you run these checks, you will be potentially excluding substantial areas where crimes may have been committed. This is why you always want to run a background check in counties a candidate has lived in during the past 7 years.

You are taking a risk by acting on “non-verified” information

The Fair Credit Reporting Act requires strict procedures to confirm the accuracy of a background check.

One of the most litigious areas of background checks is reporting inaccurate information on an individual that leads to them not getting a position. If your background check company is simply reporting information from a database without verifying the information at a county level, they may not be following strict procedures.

We strongly recommend that at a minimum, you advise your background check firm to verify any records found at the county level. However, this is where many background check companies pull a “bait & switch”.

This means they then charge you additional fees to check the county and that county may have access fees of their own. And those counties may also take several days to return the original records.

Don’t Fall for the Bait & Switch

Unfortunately, there is no $10 background check solution that is comprehensive enough and compliant to meet employers’ needs.

While you may have to pay more and wait longer, the total cost of talent acquisition is still lower than making a bad hire or exposing yourself to litigation risk.

ScoutLogic Can Help

Confused by background check terminology? Wondering how to design the right program for your company?

ScoutLogic’s mission is to make background checks easy for recruiters. We help many employers to make the right choice when it comes to setting up the best background check for their company.

Just click here to schedule a time for your free program assessment.

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ScoutLogic is not a law firm. You should always check with qualified counsel before you make any changes to your background check program. If you need a qualified attorney, we would be happy to make a referral for you.

David Garcia

David Garcia is the co-founder and CEO of ScoutLogic. David is also a senior operating advisor for Norwest Venture Partners. David is a member of the boards of ScoutLogic, YipitData, and Supplier.io and was formerly on the boards of Infutor and Avetta. He has over 25 years of B2B commercial leadership experience in data & analytics companies.