Adapting to Changes in the Background Screening Industry

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The background check industry has undergone massive change in the past decade in terms of technology, regulation, culture, and consumer expectations. Today, companies are starting to put more effort and energy into rethinking the screening process and how to make it less demanding and fair for would-be employees. 

Despite these changes, one thing that hasn’t changed is that background checks continue to be an essential part of the hiring process. A survey conducted by the Professional Background Screening Association (PBSA) found that 95% of employers surveyed conduct one or more types of employment background screening. This is similar to past years.  

It’s helpful to look back at the most significant changes. What can we expect to see next in terms of new challenges? More importantly, how can we as an industry confront these challenges head-on and build a better process? Read on.

A Decade of Major Change 

The last ten years have seen many changes within the background check space – much like we have seen in the entire hiring process. Thanks to technology, more background checks are requested and conducted digitally – without requiring a candidate to manually fill out paperwork or an employer to submit backgrounds via fax or typed entry. There are far more enhanced submission options now, such as candidate email/text invites and integrations – including applicant tracking software (ATS) solutions. This has improved the client and candidate experience. 

Additionally, the criminal research process has evolved drastically during the screening process. Researchers no longer have to go directly into every court on foot to obtain data from official records as they had to in years past. Some areas still require this, but many jurisdictions have public access terminals online that can be accessed in an automated fashion to speed up the screening process.

Another industry shift relates to the most common reasons organizations screen candidates. For the first time in the PBSA survey’s five-year history, protecting a company’s reputation overtook legal and regulatory requirements as one of the top three reasons organizations conduct background screening. 

A substantial number of regulatory changes have occurred, as well. For example, in recent years, there has been a significant uptick in state and local “ban the box” laws and other types of criminal justice reform laws aimed at helping ex-offenders find their way back into the workplace more accessible and minimizing the impact of essentially blacklisting anyone with a record.

A “ban the box” law is a criminal background check law that prohibits employers from requesting that potential employee disclose their criminal history on a job application. These laws often include additional employer requirements outside of just “banning the box,” which increases the number of steps before choosing the right candidate. According to the National Employment Law Project research, thirty-seven states, the District of Columbia, and numerous cities/counties have enacted such laws. 

Similarly, “fair chance” laws are more prevalent than years ago. The Federal Fair Chance to Compete for Jobs Act, for example, went into effect in December 2021, and the New York City Fair Chance Act took effect in 2015 but has been amended to add additional requirements since. These regulations delay the inquiry into a person’s history with the judicial system until later in the hiring process. Thus, improving consumer fairness pre-hire has been a crucial focal point nationwide. 

Overall, the way society looks at background checks and how consumers are treated during the process has changed for the better over the last decade. But that doesn’t mean there isn’t still more room for improvement.

The Challenges Ahead

With the passing of more ban-the-box and fair chance laws, there will be a greater need to find the balance between performing these essential background checks and ensuring they’re being conducted accurately and equitably for consumers. This harmony is one of the many things that organizations like the PBSA work on – ensuring that the industry maintains and promotes a high level of ethics and performance standards even as things change.

As mentioned earlier, an estimated 95% of organizations are conducting background checks of some kind, which doesn’t seem likely to change significantly in the coming years. With remote work so prevalent, background checks have become one of the most critical stages of the hiring process. But many companies are starting to – or continuing to – rethink their approach to background checks in light of newer regulations and societal changes.

As more companies hire more employees remotely, they must consider layered jurisdictional requirements in line with the area in which they are hiring and where each candidate lives. This will be an ever-growing challenge for employers across the nation as time goes on. It will require employers to focus on ensuring their background check processes are frequently reviewed and updated by their counsel.

What Needs to Happen Next

There’s a lot to think about, but these obstacles aren’t insurmountable. Background screening companies are working hard to remove the stigmas around background checks and make the process far less demanding and more compliant for employers. These agencies offer streamlined solutions that can run background checks in hours instead of days or weeks in many cases while still ensuring accuracy and compliance.

And doing so enables an organization’s hiring teams to bring on candidates in a more confident and faster fashion, reducing the risk of losing a great candidate due to paperwork and other manual delays. One study found that it can take more than three weeks between an interview and a job offer, so time is truly essential when hiring.

Aligning hiring practices with a fast and seamless solution is a guaranteed way to ensure applicants can be onboarded quickly, improving the reputation of the hiring organization. Using a modern background screening tool also quickly narrows down the candidate pool. Employers can see early on if potential candidates are a match for a company’s values and ethics. 

Finally, with the speed and accessibility of background checks today, any company can reap the benefits of implementing background checks regardless of size. And that’s important – because a job applicant, if hired, would gain access to company information and be placed in trusted positions with already valued employees. Bringing someone on board who hasn’t been vetted could damage a brand’s reputation and put its current employees and assets at risk.

Equipped for Change

The background check industry has adapted to changes from all directions in the last decade. The push for equity of opportunity and the remote work revolution are two of the most significant such changes, but certainly not the only ones. As the landscape evolves, organizations can stay competitive by integrating a modern background check solution into the hiring process

 

Katie Kulp is the Vice President of Certn.

 

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Katie Kulp is the Vice President of U.S. Compliance at Certn, a Canadian-based consumer reporting agency focused on both employment and tenant screening. Katie has more than 15 years of experience in the background screening industry overseeing operational compliance. She has previously served as co-chair of the PBSA Government Relations Committee and is
currently serving her second term on the PBSA Board of Directors. She maintains her Advanced FCRA Certification. Her passion for and extensive knowledge of background screening comes from providing quality background checks which result in regulatory compliance, a safe
workplace for employers, and safe living communities.