Background Checks for Staffing Agencies
As a staffing operations leader, you need to fill roles as quickly and cost-effectively as possible. Staffing agency profit margins are also very thin, so running high-cost checks can eat into your bottom-line. To accomplish your objectives, you need a background check which is high quality, compliant and provides a great experience for recruiters and candidates. This blog post shares practical guidance for designing the best background check packages by position, improving your compliance to reduce litigation risk, and what good service looks like for recruiters and candidates.
Designing Staffing Background Check Packages By Position
To design the right package by industry, we have provided two general package types to help guide you: .a criminal package and then a package with employment and education verifications. In addition to these packages, we also provided information on “ad hoc” searches, which you can use as add ons depending on the type of position.
Before we detail those package types and ad hoc components, we want to warn you about one kind of background check–a stand-alone national criminal search. Sometimes advertised as “instant checks” with price points under $7 per check, these reports have several issues. First, they only cover about ⅔ of U.S. counties. Web screen scraping tools often build these databases and, if a county doesn’t have criminal records online, they can’t be screen scraped. We have seen many staffing companies run these types of checks, only to be “caught” when an employer runs a full check with counties when they permanently hire someone from their staffing partner.. Second, they may not be compliant. Some background check vendors for staffing agencies will not validate findings at the original reporting source and may not be complying with the most conservative interpretation of the Fair Credit Reporting Act. Just because a background check is inexpensive in the short-term, it doesn’t compare to losing a client or a lawsuit.
That said, national criminal database searches are a great tool as part of a background check report with additional components. Per our comments above, below are two basic types of packages, which are great starting points.
- Person Search (used to validate a SSN # and generate a list of counties to check)
- National Criminal File
- Sex Offender Registries
- Terrorist and Financial Sanctions
- County Criminal Search
- Federal Criminal Search (all districts)
Criminal + Verifications
- All of the above criminal components
- Education Verification (highest degree)
- Employment Verification (last employer)
In both packages, we recommend checking all aliases and utilizing a 7-year reporting history as well as a 7-year residence history.
Additional Components To Consider
Below is a list of additional “ad hoc” components you may also want to consider.
- Motor Vehicle Records (MVR). This search is essential if the candidate is using a vehicle.
- Drug Tests. Your end client may require this, and it is also frequently used among employers.
- Employment Credit. This search type is often utilized for financial positions.
- DOT Searches. There are several different types of Department of Transportation searches used for commercial driving roles.
- Medical Sanctions. There are several different types of medical sanction searches for anything healthcare-related.
For a complete listing of search types, click here.
There is also the possibility your client will designate the packages and components they want in their background checks. To accommodate your end clients, you will want to make sure your background check company can:
- Make package changes, including new package creation, in under one business day.
- Can create an unlimited number of packages at no incremental cost to you.
- Can help you consult with your end client on which components to use based on position type.
Avoiding Common Staffing Agency Background Check Compliance Issues
Unfortunately, background check litigation is a frequent occurrence. There are regularly class action lawsuits against all types of employers, including staffing agencies, for violations of the Fair Credit Reporting Act. Below please find three areas we suggest you carefully review to minimize your risk. Please note, ScoutLogic is not a law firm, so you always want to make sure you are speaking with qualified counsel.
Review your commercial insurance policy to ensure Fair Credit Reporting Act claims are not excluded from coverage
Many commercial insurance policies exclude Fair Credit Reporting Act claims. You will want to carefully review all the exclusions in your policies to ensure nothing will prevent your insurance company from covering any background check-related claims.
Migrate to electronic authorization capture
One of the most critical components of background check legal compliance is collecting a candidate’s consent. We often find staffing agencies will collect partial or out of date documents on paper. These paper documents are then stuffed in a filing cabinet and are not retained for a consistent period of time. Make sure you are collecting the right forms from candidates, and these documents are stored electronically. This electronic data retention will make it easier to retain and search for the documents if you ever need them.
Review your authorizations and adverse action policies annually
In addition to Federal authorizations and disclosures, many states and cities have specific documents for employees who live and/or work in their jurisdiction. These forms change often, and you (or your provider) will want to ensure they are performing an annual review to make sure you have the most up to date documentation.
Great Recruiter and Candidate Service for Staffing Agencies
Everyone is incredibly busy these days. Your recruiter staff is likely leaner than ever and under constant pressure to source great talent to fill your open orders. Your recruiters simply do not have time to be tracking down candidate employment verifications, checking up on drug tests, or waiting for a response to a question from the background check agency. To help you set-up the best program, here are three questions you should ask your background check partner.
What is your unable-to-verify rate on employment verifications?
Employment verifications can be very challenging. If your candidate didn’t work for a big company or their prior employer went out of business, it can be hard to verify their previous positions. Most background check companies will simply “give up” after three tries. Because of this, it is not uncommon for some firms to have over a 25% unable-to-verify rate. Recruiters will then have to work themselves to verify employment, taking away valuable time from recruiting. You will want to work with a firm that values making background checks easier for recruiters and has at least a less than 10% unable-to-verify rate.
How can you help get candidates to take their drug tests?
Candidates taking their drug test can substantially increase the turnaround times on a background check report. Most background companies put the work back on the recruiter to follow-up with candidates to budget them to take their tests. Service-oriented background check for staffing agency firms will actively monitor if a candidate has taken the test and will follow-up with them to encourage going to the clinic.
Who is my point of contact on questions?
The background check vendor should provide you a specific person who is knowledgeable about your candidates and reports. Far too often, you will be provided a generic call center number or, if you have a larger budget, an account manager who is not familiar with your program’s ins & outs. You want the specific researcher who works on your business because your recruiters need to resolve their question or problem on the first contact, whether that is by email or phone. Your recruiters are too busy to wait for a call center employee to tell them they need to research the answer, spend a day or two tracking down and answer, and then getting back to you. Your recruiters need answers on the spot. To learn how this type of service experience can help your staffing agency, click here for a case study from Custom Staffing.
As a staffing operations leader, you need a background check partner who will help you accomplish your objectives. Too often, background check companies hurt the recruiting and onboarding process. To make background checks easy for recruiters, ScoutLogic’s unique “Scout” service model gives you dedicated researchers that improve service levels, return reports faster, and are of high quality. ScoutLogic services over 100 large and mid-size staffing agencies and is consistently among the highest-rated background check firms on Google and Glassdoor. ScoutLogic offers a complete set of services that provides everything you need to run a comprehensive and compliant program. If you would like to learn how ScoutLogic can help, click here to schedule your program’s free assessment.
Make sure your screenings are compliant, cost effective, and not costing you hiring delays.
Request a quote to see how you can:
- Save money
- Return checks faster
- Improve compliance
Thousands of recruiters trust ScoutLogic to make background checks easier, so they can focus on finding great talent.