Consistent Hiring Practices for Temps, Contingents, and Contractors

We have finally reached a day and age when HR professionals understand why pre- and post- employment background screening is mission critical. Nine out of ten employers run criminal background screens on applicants as part of their hiring process.¹ Companies of all sizes follow this practice for a variety of reasons. Background checks are conducted to prevent theft, comply with laws, reduce legal liability for negligent hiring, ensure a safe work environment for employees, and assess the overall trustworthiness of an applicant.

However, the dynamics of the workforce have changed drastically in the last few years. Nearly 26% of the average workforce is now contingent, temporary, or contract labor.² By 2020, it is estimated that 40% of US workers will be in contingent positions.³ Many companies are filling positions, that were once identified as full-time and permanent, with some kind of contracted labor. Companies believe that this kind of labor is an attractive option for them because of its short term productivity with no long term commitment. Perhaps this practice is even becoming the new norm.

“Companies seem to be relying on contingent workers because it’s flexible when you’re dealing with budgets, seasonality, specialized skillsets for projects with finite timelines,” says Ben Goldberg, President of Aurico Reports, Inc. Goldberg’s background screening customers cite contingent labor as a vital component of their businesses. “We’ve been having conversations around contingent labor screening for six or seven years, and the awareness of contingent labor screening policies has accelerated in the last year.”

The unfortunate fact is that less stringent security standards are being imposed on the contingent workforce. A recent study reported 92% of companies perform background checks on employees, but only 66% of companies performed background checks on contingent workers.⁴

There was a time when ‘temporaries’ were only a small portion of the workforce and the lack of a background screening program didn’t matter as much. A company using a staffing agency assumed that the agency had performed a background check before sending a candidate to their assignment. Maybe the very definition of that background check varied from the hiring manager’s expectations. It’s even possible that a contingent worker magically appeared in the workplace, and HR had been sidestepped, because the need was thought to be so great that the formal hiring process was simply skipped.

Today, there are severe consequences for this lack of scrutiny. Contingent workers have physical access to company facilities, networks and associated data, and other assets. They generally have the same responsibilities and visibility into corporate infrastructure. The damage they can cause mirrors that of a permanent employee in most cases.

Contingent workers are just as likely to:

• Exaggerate dates of past employment
• Falsify qualifications earned
• Inflate a job title and salary
• Conceal a criminal record
• Hide a drug habit⁵

A recent study of 1,277 job candidates (temporary and permanent) revealed that 69% had lied in some way to get their job. Nine in ten people had bent the truth on their resume in one way or another when compared with permanent hire applicants⁶; extended workforce applicants are 94% more likely to have a felony record and 50% more likely to have a misdemeanor record or drug history.⁷

Goldberg says, “While companies are viewing the use of temporary labor as a cost saving measure, they may be cutting corners on the background screening as well. If you want a truly safe workplace, the best practice is to screen all of your labor.”

Recommendations

• Create and enforce a compliance background screening program that is consistent across your organization. A cautionary note that a ‘one size fits all’ screening program may be inappropriate, non-compliance, and could result in added legal liability.
• Appoint a single business unit to map all labor entry points into your organization and create procedures to manage background screening for the entire range of options.
• Do not settle for criminal checks only. Lies about other things such as education, employment, and drug use may be just as dangerous to your workplace as criminal history.
• Use a streamlined ATS/HRIS platform that offers automated adjudication for legal compliance consistency and accuracy.
• Look for technology that allows for electronic file cabinet functionality and robust reporting tools. This will support you when there are compliance audits, questions about productivity and performance, and quality control concerns.
• Perform regular audits of worker samples to ensure consistent background screening practices are in place. 

¹ http://www.shrm.org/hrdisciplines/safetysecurity/articles/pages/background-screens-criminal-records.aspx#sthash.2SQrwtn3.dpuf

² http://www.hrotoday.com/content/5165/contingent-labor-checkup

³ http://http-download.intuit.com/http.intuit/CMO/intuit/futureofsmallbusiness/intuit_2020_report.pdf

⁴ http://www.kellyocg.com/uploadedFiles/7-KellyOCG/2-Knowledge/Talent_Management/Mitigating%20and%20Managing%20Risk%20-%20Contingent%20Labor.pdf

⁵http://hiring.monster.co.uk/hr/hr-best-practices/recruiting-hiring-advice/screening-job-candidates/what-are-the-most-common-lies-told-by-job-applicants.aspx

⁶http://www.onrec.com/news/news-archive/would-i-lie-to-you-yes-if-it-means-i-get-the-job

⁷http://hrtechnologyvendornews.com/category/talent-acquisition/