Your Small Business Requires the Most Qualified Employees

The small business owner is faced with a number of difficult decisions; one of the most difficult as well as the most critical is whether or not to hire someone. As much as a business person needs to evaluate potential employees based on their skills and qualifications, he or she also needs to verify the background and personal information supplied by applicants.

There is somewhat of a dilemma in this regard concerning the timing of background checks. The hiring process itself consists of three levels of screening:

1. An applicant applies and is determined to be at least potentially qualified, and is invited to an interview;

2. The interview takes place, and the applicant is or is not added to the final list of candidates; and

3. A job offer is made to the most qualified applicant(s).

The question, given that the resources of the small business are limited, is when to start background checks and which checks to have performed. Since background checks cost money, it makes sense to only perform them on candidates who have passed initial screening. It is also cost-effective to perform those checks in a certain order: from general for the initial screening phase to more specific for final candidates.

The small business owner may also want to perform background checks on existing employees. This procedure should probably involve different kinds of checks than those run on prospective new hires. The extent to which such checks are performed depends both on budgetary constraints and which information is most important. Of course, the safest method is to perform comprehensive background checks on all employees; the cost from doing incomplete background checks could be considerable. A good analogy to only doing partial background checks would be buying only the minimum amount of fire or liability insurance.

The purpose of this paper, then, is to give the small business owner an overview of how background checks function and what they can and cannot accomplish, in order to assist him or her to make the best buying decisions for his or her business. The range of background checking products is an extensive one, the laws regarding background checks are often complex, and the types of information that are the most valuable vary from business to business.

Lessons for Small Business Background Checks

For a small business, time is money, and there’s never enough of either. One of the most important yet arduous processes in the operation of a small business is the hiring process, and at no point is that more true than in the checking of potential employees’ references and backgrounds. Until recently, many employers decided to forgo this process altogether, because it was so time-consuming and tedious. What independent background check agencies did exist were more akin to private detective agencies and thus expensive and slow.

The advent of the Internet and the proliferation of background check services have made background checks by employers very popular.  In fact, 92 percent of small business owners polled reported that they used come kind of background check service to vet potential employees.

With this widespread popularity and use of background checks have come many marketplace choices. Along with those choices have come increasing information, accuracy, efficiency, and also regulation and the proliferation of laws regarding employment-decision background checks.  Employers now face two potential problems: the potential legal liability from doing improper background checks, and the potential harm from doing incomplete or inaccurate ones. As long as you take the time to do your background checks correctly though, you shouldn’t have too much trouble.  Simply keep the following in mind:

1. Customize your background check process to the specific job and type of employee.
2. It is more important than ever to shop for the best provider. Not all background check agencies are created equal or do an equally good job.
3. The laws are changing. Keep up to date with the laws in your state and be aware of what you can and cannot do. Also, familiarize yourself with current federal employment laws.
4. Make sure that the decisions you make based the information you obtain from background checks are job-specific and non-discriminatory. Be objective in your hiring criteria.
5. To avoid liability exposure, maintain strict confidentiality regarding the results of background checks.