Guide to Auditing and Improving Your Background Screening Program

Introduction

Conducting an audit aids in assessing the effectiveness of key organizational processes, helping to uncover inconsistencies, outdated practices, and any gaps that are creating organizational risk. Considering that a range of factors—such as new technology, increased competition, or a change in business strategy—can impact the effectiveness of organizational processes, it is beneficial to conduct an audit that examines and measures those processes. While many organizations take the first step in documenting key processes, far fewer regularly measure or audit the efficacy of those processes.

In fact, one study found that 97 percent of organizations document processes some or all of the time, but only 17 percent frequently or always put measures in place to assess the effectiveness of those processes.1

Your background screening program is a great place to start when considering an audit because background screening impacts hiring and onboarding processes as well as the overall candidate experience. In today’s ever-changing hiring market, you want to do what you can to successfully attract and hire talent, and an audit of your background screening process can help make the hiring process as smooth and efficient as possible.

It might be tempting to assume that there’s not much to be gained by auditing background screening processes or that conducting an audit will take too long or become too costly. However, regardless of your industry, the size of your organization, or the scope of your recruiting activities, it is possible to conduct a background screening audit that not only uncovers key areas for improvement but also does so in a cost-effective and time-efficient manner.

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Chapter 1

Benefits of Auditing Your Background Screening Program

Conducting an audit doesn’t have to be a months-long project that distracts from day-to-day business and recruiting activities. With the help of a committed background screening partner, it is possible to ask the right questions about key processes and identify areas for improvement. An audit of your background screening program adds value because it allows you to take a holistic view of policies and practices, including how well your program complies with existing state and federal laws. A well-executed audit ultimately helps you identify fixes and address risks before they lead to poor hiring decisions, reputational risk, or even lawsuits.

Auditing your background screening program offers the following benefits.

Facilitates compliance with new and existing regulations

On an almost daily basis, states, counties, and other municipalities are introducing new laws affecting how organizations conduct background checks. Regulations set by the Fair Credit Reporting Act (FCRA), as well as laws such as “ban the box” and salary bans, require organizations to continually monitor background check requirements across all hiring locations, including instances when laws conflict between and within states. Many organizations struggle to keep track of changes and how to adjust hiring practices accordingly. According to one study, 52 percent of surveyed business executives expressed concern about the compliance challenges presented by background check laws2.

Your background screening provider may already be sharing legislative updates and helping you understand how those laws affect you, but an audit helps to make sure all bases are covered. An audit of a background screening program evaluates related policies and practices and determines compliance with existing regulations, including:

• Checking for use of the most up-to-date FCRA-approved disclosures and authorizations, which is one of the most common areas for companies to fall out of compliance.

• Reviewing job applications for compliance with “ban the box” laws, which restrict organizations from asking about applicant criminal history

• Asking about pay equity practices, including making sure that interview practices do not include asking candidates about their salary history (a practice that is now restricted in 18 states and 20 localities)3

• Reviewing drug screening practices for compliance with the 33 states that have legalized medicinal or recreational marijuana use or both4

Identifies practices that have fallen out of step with internal policy

Hiring practices change and evolve over time, and an audit can help to identify areas where those practices are no longer in sync with internal policy. For example, a startup organization that has grown and expanded its hiring program will have different background screening needs over time and will therefore need to revisit internal policies to be sure they match current processes. Similarly, an organization that upgrades the educational or skill requirement for specific roles will find that background screening practices (for example, education verifications) will need to be adjusted to match the new requirements.

In some industries, alignment of background screening practices with internal policy is more than a good idea; it’s a requirement for continued business operations. In healthcare, for example, accreditation by the Joint Commission requires that organizations conduct background checks in accordance with the law and organization policy.⁵ Some of the areas in which an audit can evaluate the relationship between background screening practices and internal policy include:

• Screening the non-employee population—do the background screening policy and procedures for contractors, interns, and volunteers mirror the policy for employees?

• Adverse actions—is there alignment between adverse action policy and practice?

• Post-employment screening—is there a consistently applied policy and procedure for conducting background screening and license monitoring for existing hires?

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Examines current background screening products and services

Whether your background check program includes a mix of products and services for different job types or every prospective hire undergoes the same kind of background check, it is important to carefully review your current program. Just as you don’t want to overpay for background screening services you don’t need, you also want to be sure background checks aren’t missing any key components. An audit will take into account your budget, type of positions, and organizational goals, and recommend the mix of products and services that deliver the most value and help you manage hiring risk.

Without being aware of it, an organization can be using a set of background screening products and services that may have made sense at one time but are no longer the most effective solution. An audit can evaluate what kind of preemployment and post-employment background check services are being used, which make the most sense, and which should be replaced with products that are a better fit. From fingerprinting services to reference check interviews to database and public records searches, a background screening audit can help to differentiate between the products and services that are necessary and those that are just nice to have.

Introduces best practices

Just as other business processes evolve over time, best practices in background screening change as well. However, without an audit to challenge existing ways of working, it is easy to stick with practices that have become routine and part of the status quo. An audit can help you make the leap to cuttingedge practices that will move the needle in helping to deliver actionable background screening data. By taking a careful look at hiring workflows and how background checks fit into the overall hiring process, you can more easily identify opportunities to implement best practices that have been tested and proven in similar settings.

Whether it has been a while since your last audit or you’ve never conducted an audit of your background screening program, it is likely there are many ways you can infuse new ideas and take a fresh approach to background screening. An audit can identify the following best practices for you to consider:

• Automating background screening activities with a technology platform that also integrates with your ATS

• Improving the candidate experience by reviewing communication and turnaround times • Consolidating background screening services under one provider

• Introducing paperless drug screening

• Developing a process for staying abreast of background screening legislation

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Identifies opportunities to leverage new technology

A background screening audit examines key workflows, from the start to the finish of the hiring process, uncovering opportunities to improve the quality and efficiency of background checks. Even when you may already have some idea of the areas you’d like to automate, an audit can help you identify a full slate of options for automation and develop a plan for implementation.

A key differentiator for a successful background screening program is a dedicated team of screening analysts that apply expertise and judgment to deliver thorough background check results. When human analysis and technology come together, you benefit from greater automation and a way to seamlessly track dozens or even hundreds of background checks in real time. Some of the areas where an audit can pinpoint opportunities for a technology solution include:

• More efficient background check ordering and process management

• Streamlined disclosure and authorization forms

• Expanded reporting

• License tracking and reminders

Chapter 2

How to Conduct an Effective Background Screening Audit

Conducting a background screening audit can open the door to improvements that benefit the organization, employees, and candidates. An audit can be conducted at any time, but there are some key instances when it is particularly valuable to audit background screening processes and policies, such as:

• As part of an overall organizational commitment to operational efficiency

• When there is an increase in hiring, a shift in the types of positions filled, or an organizational expansion into new geographic areas

• When a problem has occurred, such as a background check that failed to identify expired licenses or other aspects of candidate history that would have prevented them from being hired for a particular position

• As part of an annual program review schedule with your background screening partner

Conducting a background screening audit can be a smooth and stressfree undertaking, particularly if you partner with a company experienced in conducting audits in many industries and types of organizations. With a dedicated background screening partner, the process of information gathering and examining current practices can get underway and lead to the timely delivery of a comprehensive set of recommendations. As you get started, here are some key areas you can expect your audit to address:

Consistency

A successful background screening program has practices that are consistent with existing legislation and organizational policy. It also fairly and consistently conducts background checks for candidates in the same type of position. A gap analysis conducted during an audit is an important initial step in testing for possible areas of inconsistency. Once inconsistencies are uncovered in an audit, it is easier to pursue strategies for addressing them. Specific inconsistencies identified in a gap analysis can include:

• Areas where current practice is inconsistent with company policy

• Variations in background screening processes for employee and nonemployee staff

• Missed opportunities for screening employees after employment (e.g., the absence of centralized license tracking)

Compliance

The penalties for non-compliant background screening can include fines, lawsuits, and even withdrawal of federal funding. An audit examines all related background screening processes for compliance with federal, state, and local law. Examples of areas an audit explores for compliance include:

• Whether the organization is using the most up-to-date FCRA disclosure forms

• An examination of the organization’s job applications for compliance with “ban the box” laws

• A review of drug screening policies and practices for all hiring locations

• A review of adverse action processes and documents

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Efficiency

An audit can help to determine if background checks include database searches or other services that aren’t necessary for certain positions. It can also uncover instances of double entry and manual or paper processes that lengthen background check turnaround times. By reviewing each of the steps taken by candidates, recruiters, and other HR staff during the hiring and background screening process, an audit identifies areas of overlap or duplication that can negatively affect hiring program efficiency and productivity.

Timing

A critical factor in background screening effectiveness is the time it takes to order and complete background checks. According to a national survey conducted by HR.com and the Professional Background Screening Association (PBSA), 62 percent of employers said turnaround time was the most significant challenge facing their organization when conducting background checks. HR and other staff members invest a great deal of time and effort in building a successful hiring process, and an audit identifies the background screening practices that will make the best use of everyone’s time. An audit makes suggestions for improvements that can save time for key stakeholders, such as:

• Improving the process for collecting background information from candidates

• Identifying a clear protocol for the number of locations in which to conduct criminal history searches

• Exploring technology options that can speed the flow of information between HR, candidates, and background screeners

Integration opportunities

As with many other important organizational processes, technology plays an important role in supplementing the human processes of problem-solving, analysis, and decision-making. A background screening audit reviews how existing technology is used and how integrations can automate key processes, put more information in people’s hands, and support greater analysis and reporting. A great example is integrating background screening technology with the ATS. When those two platforms come together, there is less double entry for recruiters and candidates, and background checks are easier to track as candidates move through the hiring process. A background screening audit can also identify opportunities for integration with onboarding platforms and HRIS systems.

Opportunities to involve key stakeholders

Background screening is a critical component of hiring and talent management processes, but it is not solely the responsibility of HR. Given the legal and compliance-related ramifications of conducting poor or incomplete background checks, employees in risk management, compliance, and legal are key stakeholders and should play a role in the background screening audit. The healthcare industry is a good example of the importance of having multiple stakeholders take part in the background screening audit. Given the need to satisfy guidelines of Centers for Medicare and Medicaid Services (CMS) and the Joint Commission, hospitals and health systems should secure the involvement of stakeholders such as credentialing and medical staff, volunteer services, and hospital managers that coordinate background checks for vendors and non-employees.

Chapter 3

How to Maximize the Impact of the Audit

After gathering the necessary information and conducting a gap analysis, your background screening partner can present findings and make recommendations for improving your overall screening program. To get the most out of the audit and maximize its impact, the next step is to take follow-up action.

Given the investment of time and effort by stakeholders, it will be necessary to make a plan for follow-up that sticks. Some changes can be implemented immediately, whereas others will involve technology upgrades, new policy development, or careful rethinking of existing processes. Some of the actions you can take to maximize the impact of your audit include:

• Develop a detailed timeline for policy changes and process improvements

• Periodically review the mix of products and services included in the overall background screening program

• Stay alert to new legislative changes affecting your industry and hiring locations

The period following your background screening audit may also be a good time to evaluate your background screening provider. To help facilitate a robust and comprehensive background screening program that delivers value in the short and long term, you’ll understandably want more than a vendor relationship; you’ll want a true partner. A fruitful partnership will help you identify and address compliance risks, improve workflows, and implement best practices on an ongoing basis.

Sources:

1. “The State of Business Process Management 2016.” BP Trends. 2016. https://www.bptrends.com/bpt/wp-content/uploads/2015-BPT-Survey-Report.pdf.

2. “The Littler Annual Employer Survey.” Littler Mendelson. 2019. https://www.littler.com/files/2019_littler_employer_survey.pdf.

3. Salary history bans: A running list of states and localities that have outlawed pay history questions.” HRDive. Updated February 24, 2020. https://www.hrdive.com/news/salary-history-ban-states-list/516662/.

4. “Marijuana in the Workplace: How It’s Changing the Drug Screening Process.” Corporate Screening. https://www.corporatescreening.com/blog/marijuana-in-the-workplace-how-its-changing-thedrug-screening-process.

5. “Criminal Background Checks - Requirements.” The Joint Commission. Last updated on December 21, 2017. https://www.jointcommission.org/en/standards/standard-faqs/laboratory/human-resourceshr/000001355/.

6. “National Survey: Employers Universally Using Background Checks to Protect Employees, Customers and the Public.” HR.com and PBSA. June 2017. https://pubs.thepbsa.org/pub.cfm?id=6E232E17-B749-6287-0E86-95568FA599D1.

 

Chapter 4

Audit Your Background Screening Program with a True Partner: Corporate Screening

Change is a constant. Regulations affecting background screening are changing, and so is your industry and organization. Whether you’ve uncovered gaps in your background screening program or want to understand how you can make a strong program even more effective, an audit is a good place to start identifying inconsistencies, inefficiencies, and areas where you can get more from technology platforms.

At Corporate Screening, we understand an organization’s need to conduct high-quality, timely background checks while managing hiring risk and improving the candidate experience. If you’re new to Corporate Screening, we can work with you to complete an initial audit and make recommendations that will help you develop a more effective background screening program. When you’re a Corporate Screening customer, you’ll enjoy annual audits as a complimentary service. Contact us today to see how we can help you audit and improve your background screening program.

 

 

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