Is it Time to Shift to Digital Employee Background Checks?

Published On
September 28, 2023
Read Time
5 minutes
OnBlick Inc.

Is it Time to Shift to Digital Employee Background Checks?

A large portion of HR processes has been digitalized since the pandemic hit the world. Remote work settings forced employers to adopt, from training employees for a digital world to hiring talent that’s familiar with digital tools. While businesses adapted to technological tools to conduct background checks on recruits, they might not be completely satisfied with the results.

Emerging technological trends with HR operations play a key role in maintaining a balance with organizational functions and interests. However, with the businesses going back to in-office settings, will virtual background checks be normalized?

In this article, we will discuss the pros and cons of automated background checks and things to keep in mind before indulging in the process.

Why do Employers Conduct Background Checks?

Firms conduct employee background checks as a means of gathering information from sources other than the individuals themselves. They are carried out to evaluate the employment eligibility of a potential hire. An applicant may be unqualified due to misrepresentation of their education, work history, financial history, medical history, or other violations of the law. Background checks may include credit reports, social security verification, and the criminal records of an individual.

A background check may be conducted for the following reasons:

• Workforce Safety

• Greater Quality of Employees

• Compliance with Federal Norms

• Heightened Productivity

• Prevents Workplace Thefts

Digital Tools for Background Checks

Digital tools have now become a requirement for employee background checks for enhanced results. Screening firms offer a wide range of resources as references for an employee that may be contacted confidentially by the employer.

Studies state that technological tools have been adopted lately across various sectors including e-commerce, logistics, staffing, and manufacturing, among others. It is believed that these tools may improve background checks by reducing manual labor, using automation for faster processing, and blockchain for improved efficiency.

Surveys reveal that around 32% of firms used technology tools as an alternative for the verification of new hires during the COVID-19 lockdown. Companies have lately been in favor of hiring third-party vendors for background checks, given the lack of resources during remote hiring.

However, before making employment decisions based on employees’ background information, employers must comply with federal laws to protect applicants from discrimination.

Advantages and Disadvantages of Automated Background Checks

The pandemic highlighted the need for an automated system for background screening of potential hires. They ensure that the entire process becomes less time-consuming and more efficient. Some of the other pros of digitalization of background checks include:

• Reduction in turnaround time

• More accurate data entries

• Control over personal information collected

• Improved data protection and redundancy

• Integration with an HRMS system

Some employers believe that digital tools may not be considered a solution for background check processes. It may provide employers with false positives or false negatives for certain employees. Background checks cannot be reliable if conducted digitally as some records may be available partially online and offline, which may create gaps in the information acquired.

Practices for Background Checks: Statute Laws

Digital footprints of employees can be used easily to access their information on a professional and a personal level as well. Employers need to ensure that they keep a check on the information collected. They should only collect data that may be necessary to understand the employment eligibility of the employees.

Additionally, they should store the information temporarily and erase the records once the purpose is fulfilled. Under the General Data Protection Regulation (GDPR), businesses should state the need for the collection of personal data of employees. It requires an evaluation of these needs based on the rights of the individuals.

The Immigration Reform and Control Act of 1986 (IRCA) forbids discrimination among employees based on their national origin or citizenship. For immigrants, the Form I-9 employment verification process is conducted after the employees are hired. Once hired, employees cannot be terminated based on their national origin.

According to the laws enforced by the Equal Employment Opportunity Commission (EEOC), it is “illegal to check the background of applicants and employees when that decision is based on a person's race, national origin, color, sex, religion, disability, genetic information (including family medical history), or age (40 or older)”.

While working with a third party to conduct background checks, employers must comply with the Fair Credit Reporting Act (FCRA). If the employers get their hands on any background information of the employees, the FCRA requires them to take the following steps beforehand:

• Inform the applicant that the information might be used for decisions about their employment

• If the company provides an investigative report of the employee, they should have the right to a description of the nature and scope of the report

• The employer should have the written permission of the employee to do a background check

• The company that provides the report should be certified that the employer has received the written permission of the employee, complied with the FCRA requirements, would not discriminate against the employee, or misuse the information in violation of the federal and state laws

• Once the recordkeeping requirements are fulfilled, the report should be disposed

In Conclusion

There is no single way that may be perfected to conduct background screening of employees. While automation tools may save time and reduce manual errors, they may not be enough to assess candidate information.

It is thus advised that employers conduct one-on-one physical or telephonic interviews to assess an employee before hiring them. In addition to compliance with the federal and state norms, and safety of the workforce, background checks act as a tool that may allow employers to understand their new hires better.

With the help of OnBlick’s HR and Immigration System, employers can be assured of a flawless employee onboarding experience. OnBlick makes it easy for employers to keep track of their new hires and maintain their data. To know more about OnBlick's HR and Immigration solutions, book a demo today.

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