The Changing World of Background Checks
With growing frequency, companies are conducting background checks to safeguard people, property and knowledge. Several factors account for the increase in and depth of these checks. They’ve grown much less expensive to conduct, experts report, and firms are viewing these preventive measures as a good investment.
Tensions are much higher in the post-9/11 world, of course, and reports of in-company identity theft and other security and safety breaches have been highly publicized. If firms are not sure who they’re hiring, the consequences can be disastrous.
Many companies are relying on experts and outsourcing to help them make those crucial decisions. Only about one-quarter (23.3%) of 72 respondents to a December 2004 Human Resource Institute (HRI) survey reported doing in-house checks. That may be because delving into the information required to select the right employee or reject a potential hazard has grown more complex, and the data to be searched is massive. Years ago, databases documenting personal credit, criminal history and even sexual predator information were not as well established or as accessible.
Almost all (94%) of the 2004 HRI survey respondents reviewed criminal history. Beyond that level, most verified past employment (79%) or education (76%). Smaller but still considerable portions verified Social Security numbers (68%), investigated driving records (61%), checked references (58%) or confirmed certifications (32%).
Similar findings were reached by a 2004 poll by Human Resource Executive. It found that most U.S. employers surveyed screen applicants for criminal records, but smaller portions verify candidates’ Social Security records/identities. That survey also found that a mere 11% check government watch lists that include information about terrorists (“Background Screening,” 2004).
On the other hand, there are cases where companies probe quite deeply into applicant backgrounds. The checks conducted on behalf of some organizations with overseas operations, for example, approach the kind of thoroughness used by the U.S. government. These firms want to go beyond checking databases and employers. “We’re not only asking former employers about them, we’re asking people in the neighborhood where they live,” said Robert W. Seiden, president of Fortress Global Investigations, in Human Resource Executive (“More than the Basics,” 2004).
Personal credit has also become an important part of many background checks. Nearly 40% of HRI respondents to a May 2005 survey investigated credit. Some employers regard having bad personal credit as a warning sign that individuals may be at greater risk to commit theft, fraud or other improprieties. They may also be more susceptible to advances from insiders or outsiders with ill intent.
For example, a scam recently hit what experts estimate as many as 700,000 banking customers. This involved an outsider paying employees $10 for each client’s information they compromised (“More than 100,000,” 2005). A major incident also occurred at an outsourced call center in Pune, India, when employees misused customer information to steal nearly half a million in U.S. dollars (Nelson, 2005).
Safeguards to prevent such infractions are changing the nature of some workplaces. Some computers are disabled from saving data, rendered “dumb” or “diskless.” Palm Pilots, iPods, and cell phones are not allowed in many areas where the workforce has access to secure information. Video surveillance has grown more common in some industries, and some firms search workers when they leave to make sure they have not taken secure information. Even some standard office supplies, such as pens and paper, are banned in cubicles where workers could copy and misuse account information.
Beyond checking prospective employees, many companies are reviewing the backgrounds of outsourcing firms as well, reviewing contractors’ security plans and demanding tighter measures from them. “Data security and privacy used to be an afterthought,” notes a spokesperson of Wipro Technologies in Bangalore. “Now customers are talking about it right at the RFP stage itself. They want a security plan with the proposal” (Vijayan, 2004). What’s more, British officials have sounded the alarm that terrorists may be planning to infiltrate the banking industry by seeking to place their own as employees (“Organized Crime,” 2004).
Engaging in proper background checks can help companies minimize risks and provide the kind of safe, secure workplaces that are increasingly in demand among employees. Taking a closer look at prospective employees and outsourcing firms can also be instrumental in maintaining corporate reputations, shareholder confidence and customer loyalty.
For more information about HRI’s 2004 Background Survey and HRI’s 2005 Credit Check Survey, click here.
Documents used in the preparation of this TrendWatcher include:
“Background Screening.” Human Resource Executive [www.ercdataplus.com/hrexecutive/results/jul2004/]. July 2004.
“More than 100,000 Notified of Possible Record Theft.” USA TODAY [Associated Press] [usatoday.com]. May 23, 2005.
“More than the Basics.” Human Resource Executive, October 2, 2004, p. 61.
Nelson, Erika Lee. “ India Fortifies Its Data Security.” Washington Times Online, May 27, 2005.
“Organized Crime Targets Finance Firms.” Management-Issues [www.management-issues.com]. November 12, 2004.
Vijayan, Jaikumar. “Security Expectations, Response Rise in India.” Computerworld [www.computerworld.com]. August 30, 2004.
Tensions are much higher in the post-9/11 world, of course, and reports of in-company identity theft and other security and safety breaches have been highly publicized. If firms are not sure who they’re hiring, the consequences can be disastrous.
Many companies are relying on experts and outsourcing to help them make those crucial decisions. Only about one-quarter (23.3%) of 72 respondents to a December 2004 Human Resource Institute (HRI) survey reported doing in-house checks. That may be because delving into the information required to select the right employee or reject a potential hazard has grown more complex, and the data to be searched is massive. Years ago, databases documenting personal credit, criminal history and even sexual predator information were not as well established or as accessible.
Almost all (94%) of the 2004 HRI survey respondents reviewed criminal history. Beyond that level, most verified past employment (79%) or education (76%). Smaller but still considerable portions verified Social Security numbers (68%), investigated driving records (61%), checked references (58%) or confirmed certifications (32%).
Similar findings were reached by a 2004 poll by Human Resource Executive. It found that most U.S. employers surveyed screen applicants for criminal records, but smaller portions verify candidates’ Social Security records/identities. That survey also found that a mere 11% check government watch lists that include information about terrorists (“Background Screening,” 2004).
On the other hand, there are cases where companies probe quite deeply into applicant backgrounds. The checks conducted on behalf of some organizations with overseas operations, for example, approach the kind of thoroughness used by the U.S. government. These firms want to go beyond checking databases and employers. “We’re not only asking former employers about them, we’re asking people in the neighborhood where they live,” said Robert W. Seiden, president of Fortress Global Investigations, in Human Resource Executive (“More than the Basics,” 2004).
Personal credit has also become an important part of many background checks. Nearly 40% of HRI respondents to a May 2005 survey investigated credit. Some employers regard having bad personal credit as a warning sign that individuals may be at greater risk to commit theft, fraud or other improprieties. They may also be more susceptible to advances from insiders or outsiders with ill intent.
For example, a scam recently hit what experts estimate as many as 700,000 banking customers. This involved an outsider paying employees $10 for each client’s information they compromised (“More than 100,000,” 2005). A major incident also occurred at an outsourced call center in Pune, India, when employees misused customer information to steal nearly half a million in U.S. dollars (Nelson, 2005).
Safeguards to prevent such infractions are changing the nature of some workplaces. Some computers are disabled from saving data, rendered “dumb” or “diskless.” Palm Pilots, iPods, and cell phones are not allowed in many areas where the workforce has access to secure information. Video surveillance has grown more common in some industries, and some firms search workers when they leave to make sure they have not taken secure information. Even some standard office supplies, such as pens and paper, are banned in cubicles where workers could copy and misuse account information.
Beyond checking prospective employees, many companies are reviewing the backgrounds of outsourcing firms as well, reviewing contractors’ security plans and demanding tighter measures from them. “Data security and privacy used to be an afterthought,” notes a spokesperson of Wipro Technologies in Bangalore. “Now customers are talking about it right at the RFP stage itself. They want a security plan with the proposal” (Vijayan, 2004). What’s more, British officials have sounded the alarm that terrorists may be planning to infiltrate the banking industry by seeking to place their own as employees (“Organized Crime,” 2004).
Engaging in proper background checks can help companies minimize risks and provide the kind of safe, secure workplaces that are increasingly in demand among employees. Taking a closer look at prospective employees and outsourcing firms can also be instrumental in maintaining corporate reputations, shareholder confidence and customer loyalty.
For more information about HRI’s 2004 Background Survey and HRI’s 2005 Credit Check Survey, click here.
Documents used in the preparation of this TrendWatcher include:
“Background Screening.” Human Resource Executive [www.ercdataplus.com/hrexecutive/results/jul2004/]. July 2004.
“More than 100,000 Notified of Possible Record Theft.” USA TODAY [Associated Press] [usatoday.com]. May 23, 2005.
“More than the Basics.” Human Resource Executive, October 2, 2004, p. 61.
Nelson, Erika Lee. “ India Fortifies Its Data Security.” Washington Times Online, May 27, 2005.
“Organized Crime Targets Finance Firms.” Management-Issues [www.management-issues.com]. November 12, 2004.
Vijayan, Jaikumar. “Security Expectations, Response Rise in India.” Computerworld [www.computerworld.com]. August 30, 2004.