The Importance of Conducting Background Checks for Growth Companies

, , | April 20, 2023 | By

When a growth company has solid momentum, hiring the right talent can have a significant impact on whether that momentum is sustained or not. In today’s competitive employment market, securing good candidates can be challenging. This makes employment background checks more critical than ever.

At least 72% of companies do a background screening before each hire because informed hiring decisions are important. Background checks, including employment and education verification, complete the picture of who a candidate is beyond what you see on the resume and hear in the interview.

Here are a few reasons why every organization, especially growth companies, should conduct background checks.

Guard Against Fraud

As your first line of defense against deceit and fraud, background checks verify the honesty of your prospective employees, helping you identify anyone not representing themselves accurately. When applicants know they will undergo a screening process before being hired, they are less likely to hide important details.

Most employers want to check their prospective employees for criminal records, and verify that the education and employment they reported are accurate. Organizations that work with vulnerable populations, such as children, often add additional screenings like the sex offender registry screening, motor vehicle reports, or drug screenings.

Keep in mind, your organization has a legal obligation to protect your staff, customers, and business from any foreseeable acts by a volunteer or employee.

Avoid Negligent Hiring Liability

If you were to skip, the background screening process and an employee commits a crime while on the job, your organization is potentially liable for their actions.

The injured party against the employer makes a negligent hiring claim. Legally, it’s reasonable to expect that an employer ‘should’ have known the history of the person they hired.

Employees and volunteers do have rights to privacy in certain areas. However, within those limits, consistently performing thorough background checks and paying attention to any red flags helps insulate you from negligent hiring liability.

Avoid Negative Publicity

Some marketers say any attention is good attention, but a publicity story that reflects poorly on your company can impact your public image for years to come. Bad publicity chases clients, potential employees, and potential partners away from you and toward your competition.

Careful hiring practices are not the only thing a growth company needs to do to build a great reputation, but it’s an excellent start.

Discourage Applicants With Something To Hide

Background screenings encourage honesty and transparency in the application process. Candidates who know they will be exposed by a background check will either address the issue upfront with an explanation or avoid your company entirely.

You don’t have to rely on your gut instinct or powers of analytical deduction to vet candidates. You can pick the most qualified individuals who seem to be the best fit for your growth company and verify that what they’ve shared with you is the true and whole story.

Increase New Hire Quality

Any agile company that is in the process of building systems to support its growth needs smart, effective employees. A background screening helps uncover intangibles beyond what you can discover during the hiring process.

If you are relying on a person because they say they’ve done this work before, it is costly and jarring when they start the job and are unprepared. It’s also costly to hire and train someone who seems to have a good track record of longevity but was covering up several job changes. You can avoid these setbacks by confirming their education, work experience, and licenses.

Background Checks Inform and Protect

The world is not without risk. No matter how hard you try to address all possible contingencies, there will always be new challenges. You can minimize this risk, though, by putting smart practices in place. Background screening all new hires prevents unnecessary setbacks and avoidable mistakes.

The best people propel the best companies. Make sure your growth company is consistently hiring the best.