How And When Should An Employer Or Recruiter Run A Background Check On A Remote Employee? Tips To Consider For Conducting A Background Check For IT Remote Workers Outside North America.

The recruitment and selection process isn’t as simple as it sounds. It doesn’t only entail posting a job advert, shortlisting, conducting interviews, and onboarding the most talented candidate. A thorough recruitment and selection process

The recruitment and selection process isn’t as simple as it sounds. It doesn’t only entail posting a job advert, shortlisting, conducting interviews, and onboarding the most talented candidate. A thorough recruitment and selection process – whether for in-office or remote working employees – contains running background checks even on the most talented individuals in the pool your job advert attracts. Just because a candidate includes they are honest and trustworthy on their resume doesn’t mean that you should take their word for it. Doing so could jeopardize the well-being of your organization. 

Note that you will be entrusting company information of all types to a new hire hence the need to be fully confident of the things they’ve put down in their resume. You cannot afford to take chances when it comes to your company’s reputation and overall stability. So, if you’ve been skipping background checks when bringing in new members of the organization, you’ve been taking a huge unnecessary risk, and you need to correct that moving forward. 

Running background checks on employees and volunteers should be a critical part of any organization’s business process, including recruitment and selection. Background checks go a long way in minimizing risks linked to criminal activities such as theft, abuse, and violence. They are also good for verifying the information on an applicant’s resume and helping the hiring manager| or organization decide if a person is fit for the job. How and when should an employer or recruiter perform background checks? What tips can employers rely on to ensure the effective running of background checks? This post seeks to answer these two questions. 

But first things:

What Are The Benefits of Running Background Checks On Remote Employees?

As a business owner, a Hiring Manager| or an HR professional, it is your duty to ensure that all telecommuters are protected. Additionally, you should ensure that your recruitment and selection process facilitates hiring someone who can be trusted. No organization or HR manager would want to on-board a good-for-nothing, thieving, lying candidate capable of putting other co-workers in harm’s way, tarnishing the company’s reputation, or stealing invaluable company assets, including critical data and information. 

Further, any enterprise – small, medium, or large – wouldn’t want to keep a person on their payroll with constant run-ins with law and order. Every company desires to have a remote employee who is fully settled in their job and available to ensure productivity and performance. 

Background checks provide the HR professional with all the data they require to earmark the threat level of a potential employee. Organizations hold a wealth of information, such as client files, customer data, trade secrets, and business strategies. For this reason, a background check on an employee, especially if this information will be shared remotely with telecommuters, should be a must-do for all organizations. 

Besides stringent candidate vetting, organizations must ensure oversight when passing sensitive information around. For instance, a company may invest in the relevant software or a tool that allows tracking of employee activity because of the risk involved when working with remote workers. You want to be sure that company information remains within the company and that it doesn’t get into the wrong hands. Steering clear of bad candidates is why organizations shouldn’t disregard employee background verification.

What are the costs of a bad hire to a business?

A bad can be costly to an organization. According to the US  department of labor, the average cost of hiring the wrong candidate can go up to 30% of the worker’s first-year earnings. If an organization onboards a person with an annual pay of $80,000, the expense the employer suffers is $24,000. To a large organization, this figure might not seem a lot. However, for a small or medium enterprise that operates a small budget, this is alot of money to waste as it can hurt an organization’s bottom line. 

Another report by the Chief Executive Officer of Link Humans put the average cost of a bad hire at $240,000 in expenses.  So, what are the sources of these costs? These costs relate to the hiring process, retention, and pay when broken down. Many of the costs are associated with the recruitment process, i.e., advertising, agency fees, and the pro-rata salaries of the senior workers who interview the applicants. The time the HR team spends on the hiring and onboarding process is part of these costs. Inevitably, the company will spend money on in-house training as well. Ultimately, if the enterprise finds it necessary to repeat the entire hiring process because of a poor hire, the costs to the company will double at a minimum. For companies that recruit regularly, this may not come as a surprise. However, besides these tangible costs, the organization will suffer additional less visible costs resulting from activities such as substandard employee performance. A research study revealed that bad hires not only lead to low productivity, but managers are forced to spend 17% of their working time supervising poorly-performing workersthat’s a full working day wasted in a standard week that would have been used performing actual work. 

Gallup research revealed that actively disengaged US workers cost organizations anywhere between $450 & $550 billion in lost productivity annually. A study by CareerBuilder collaborated on the huge costs a company suffers for making a bad hire. They found out that about 75% of companies who admitted to making a bad hire reported $14,900 on average of wasted money – they reported hiring the wrong person for the job. 

Hiring bad employees costs the organization money through lost productivity, lost clients, ruined reputation with clients, damaged employer reputation, reduced teamwork, time lost when supervising a bad hire, recruitment costs, training costs, and legal fees. While legal fees aren’t common, they might show up when an organization’s only way out of a bad hire is firing the employee for bringing the team down and disrupting the business progress – litigation might be inevitable. In such instances, the company might end up with high legal fees. Thankfully, by avoiding a bad hire in the first place, the organization can prevent all these costs. 

How and when Can an Employer|Recruiter Run a background check on a Remote Employee?

How best should an employer or recruiter approach background checks on remote employees to avoid unnecessary problems and costs associated with a bad hire? 

The purpose of background checks is to verify an applicant’s identity using information such as the birth date and social security number. It entails searching the candidate’s financial records, court records, or public records databases. When it comes to educational institutions, previous employers, or professional organizations a candidate has included in their resume, the employer may consider performing manual contact. Background checks are usually performed by a human resources professional. They use a background check company, software such as HRIS, or a consumer reporting agency (CRA). Employers and recruiters must familiarise themselves with state and FCRA laws that provide strict guidelines about how background checks are carried out – an essential step for avoiding legal risks. 

The most sensible time to perform background checks is at the point the employer is ready to make an offer. However, some companies prefer performing background checks on several job candidates to inform their employment decisions. A company’s decision on the best time to perform background checks is another balancing act. Many organizations love running checks post-final interview, some doing it before the offer and others doing it post-offer. 

Then some organizations do things completely differently. They run background checks early on in the selection process to determine if the candidate is worth interviewing in the first place. The downside of this option is the high cost associated with running background checks since they will be done on many candidates. Note that the costs of advertising a position, sorting through the many applications, interviewing, hiring, and onboarding are already high. Going through this process and finding out the chosen applicant wasn’t truthful about their reasons for leaving the previous employer or they overexaggerated their qualifications can lead to excessively higher costs. Companies that utilize this approach do so for a reason. They believe that even though background checks incur an obvious tangible cost, performing them at the beginning of the recruitment process is a small expense compared to onboarding a bad hire. 

Irrespective of the background check timing, we must agree that hiring employees – remotely or face-to-face – is as important as the interview itself. On the same note, when hiring happens remotely, the absence of the benefits associated with face-to-face interviewing emphasizes the importance of performing background checks on prospective remote employees. 

Despite the time your organization deems most suitable to conduct background checks on potential remote workers, they must follow the following four main steps to ensure compliance:

  1. Disclosure – the employer must notify the candidate of their intention to conduct pre-employment screening, informing them that the process is a pre-condition of the offer. 
  1. Consent –  an employer shouldn’t embark on a background check without the job candidate’s consent. Therefore, the prospective remote employee must supply written consent and must get a notification from the agency assigned to conduct the check. The candidate should also be made aware of their rights under the FCRA. 
  1. Investigation – upon providing consent and enough personal details, relevant resources are used to compile the needed report. 
  1. Review – the employer receives a report for review. Typically, the report will be marked either ‘clear’ (an indication that the employer may employ the candidate) or ‘consider’ (an indication that the search revealed worrying concerns).

What next for an employer who finds a red flag on a background check report of a person they considered suitable for the job? A red flag shouldn’t automatically disqualify an otherwise good job candidate. Once you’ve found something worrying about a candidate from the background check report, it’s always advisable to ask the candidate about it and allow them to respond. 

Some red flags are worth further discussion if the HR manager feels the remote work candidate isn’t worth letting go of easily – especially if they have top-notch skills, knowledge, and expertise. Revelations worth talking about include criminal record, unlawful or inappropriate social media activity, inconsistencies between the background report and resume information, negative comments| or opinions about the job candidate from former colleagues during reference checks, and poor credit history. An explanation about a candidate’s poor credit history is particularly important if the position being filled requires good money management or entails corporate spending. 

Full compliance with the FCRA requirements associated with adverse action demands providing the candidates with copies of their background check reports and installing a process allowing candidates to dispute the findings. 

Tips for conducting a background check for IT remote Workers outside North America 

One of the best things about remote working is that today, more than ever, companies can select talents from a global pool of prospective employees without location restrictions. This way, companies can onboard talented IT professionals to their various teams and benefit from their skills and expertise. This advantage doesn’t come without its downside. The first challenge that most employers who rely on remote workers outside North America face are how to conduct background checks. 

A foreigner applying for a position in a company in the United States should undergo an international background check -specifically, in the country they have been living, obtained their education, and worked. It works the same an American citizen would be subjected to an international background check after living, working, and gaining an education in a different country. If such a candidate possesses a top position in a foreign company, particular aspects of the performance of the organization they work for should undergo a check. 

Here are some of the components of an international background check. 

  1. Business Credit Report  

There are three occasions where an international business credit report comes into play – one being when an employer is considering onboarding someone who has played a critical role in the management or finances of a foreign-owned organization. A business credit report provides information such as lawsuits involving the company, payment histories, and financial information such as balance sheets, cash flow, income, and revenue for publicly traded firms. 

  1. Personal Credit Report 

After spending considerable time in a country, a job candidate will have a credit history there – more so if the candidate bought and maintained a property there. It’s worth noting that personal credit reports are specific to the country, meaning that the job candidate could have a clean record in the United States yet have a worrying record in the country where they reside. 

  1. Civil Records – Local Level 

This type of background check is designed to determine if a job candidate has ever been involved in civil lawsuits at the local level. It takes note of low-level lawsuits possibly adjudicated in small-claim courts – including breach of contract or personal injury suits. Civil records reports may have legal ramifications and moral| and ethical overtones for the job candidate. A civil records background check could also reveal more serious civil cases such as divorce, bankruptcy, foreclosures, defamation, and personal restraining orders. No organization would be interested in hiring a candidate who was sued by several domestic servants for failing to pay or by women who alleged sexual misconduct. The employer will draw relevant conclusions from the report generated that will inform their hiring decision. 

  1. Federal Criminal 

This type of background targets crimes such as tax evasion, violation of weapons laws, drug laws, and environmental regulations. It also seeks to discover if the candidate has ever been involved in offenses such as fraud and bribery, trade secrets theft, spying, and counterfeiting.

  1. Criminal Records at the Local Level 

This background check reveals if a candidate has ever been convicted of serious crimes such as child endangerment, theft, embezzlement of funds, resisting arrest, fraud, homicide, domestic violence, assault, weapons offenses, drug offenses, and drunken driving. 

  1. Educational Background Check 

Some job candidates have been caught red-handed after falsifying educational accomplishments. It mostly happens through misrepresentation or exaggeration of a person’s academic qualifications. Online recruiters like indeed.com confirm that educational background is one of a resume’s most commonly falsified areas. An international education background check seeks to verify all the educational levels accomplished by a job candidate as noted on their resume. The background check also checks the status of the institution of learning. It verifies that the university or college mentioned is accredited and not a company that sells bogus academic credentials.

  1. Employment Verification 

Unknown to many employers, job applicants usually lie about their previous employers. For legal reasons, the majority of employers only provide dates of employment. Employment verification is critical because little might be known about the candidate’s former employer, but an employment verification should also confirm the organization’s existence. 

Tips For Approaching International Background Check

The process is similar to performing a background check in the United States. Still, it has a few additional steps, more time, and supplementary documents. If you are preparing to run a background check on a job candidate outside North America, approach it in the following way:

  1. Establish the checks needed, which the screening policy will inform of your company and the position you are filling. Different background checks, such as education verification, criminal record, and employment history, may be required. 
  1. Be conversant with the laws guiding background checks for foreigners or potential IT employees living outside North America. It could be a difficult process since each country has its laws that determine the information available for release and the type of documents needed for submission by the job candidate. 
  1. Seek authorization before running a background check. You should not run a background check on a job candidate without their consent. It applies to candidates living in the US and those outside the US. Failure to request consent may lead to legal consequences.
  1. Upon obtaining authorization, the employer may now order the background check from a reputable and qualified screening provider. 

Performing an international background check on potential remote IT employees is important because it allows compliance, risk mitigation, and informed decision-making. 

Bottom Line 

Conducting a background check for employment assists an organization or hiring professionals in making informed decisions. It also makes it possible for the company to ensure a safe work environment, safeguard company assets, minimize the risk of liability claims, and allow compliance with state, federal, local, and industry laws and regulations. When it comes to the timing of background checks, organizations approach it differently depending on their interpretations of the costs associated with a bad hire. Some companies perform background checks pre-offer, while others post-offer and subject to particular conditions. 

Then we have organizations that choose to carry out pre-employment screening at the early stage of the recruitment process – after shortlisting and before interviewing. They argue that the costs associated with finding out a person is wrong for the job at the end of the recruitment and selection process are higher than what a company spends on pre-employment screening before they conduct interviews. They believe it’s better to ascertain if a candidate is worth interviewing before taking further steps. When conducting background checks, organizations or hiring managers must comply with state, federal, local, and FCRA regulations. The only way to ensure compliance is to familiarize oneself with these laws and apply them when performing background checks on potential employees. 

When sourcing IT remote workers outside North America, organizations can apply particular tips to facilitate an effective background check process. For instance, an employer should first determine the needed checks before beginning the process. Further, an employer shouldn’t perform a background check on a potential remote IT worker without their consent. They must seek authorization first. Employers must also familiarize themselves with the laws that guide international background checks. With enough knowledge, it’s impossible for the company or HR professionals to make mistakes that could lead to legal consequences. Upon establishing the most important checks, learning about the guiding laws and regulations, and seeking authorization from the individual, the company may order an international background check. Once the report is out, the hiring team will be in a position to make an informed decision about the most suitable person for the remote IT position. 

References 

  1. https://www.apollotechnical.com/cost-of-a-bad-hire/
  2. https://www.hiresafe.com/client-support/background-check-faq/why-are-background-checks-important/
  3. https://www.identifiofficeprofessionals.com/news/the-importance-of-background-checks-when-hiring-remotely/41057/#
  4. https://www.betterplace.co.in/blog/background-check-for-remote-employees/
  5. https://resources.workable.com/tutorial/employment-background-checks
  6. https://www.markelinsurance.com/resources/small-business/the-importance-of-background-checks#:~:text=Background%20checks%20can%20help%20reduce,right%20person%20for%20the%20job.
  7. https://www.globalbackgrounds.com/insight-center-blog/2021/6/15/who-should-undergo-international-background-checks
  8. https://checkr.com/background-check/international-background-checks
  9. https://www.goodhire.com/screening/international-checks/
  10. https://www.linkedin.com/pulse/how-long-does-take-do-international-background-check-sachin-aggarwal?trk=public_post-content_share-article

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