When it comes to hiring new employees, conducting background checks has become a standard practice for many companies. In fact, according to a survey by the Society for Human Resource Management, 96% of employers conduct some type of background check on potential employees. But what is the true cost of these background checks? And are they worth it?
In this article, we will explore the various factors that contribute to the cost of background checks and the potential consequences of not conducting them.
The Cost of Background Checks
Types of Background Checks
The cost of a background check can vary depending on the type of check being conducted. Some common types of background checks include:
- Criminal background checks: These checks search for any criminal records associated with an individual, including arrests, convictions, and pending charges.
- Employment verification: This type of check verifies an individual’s employment history, including job titles, dates of employment, and salary information.
- Education verification: This check confirms an individual’s education history, including degrees earned and dates of attendance.
- Credit checks: These checks look at an individual’s credit history, including credit score, payment history, and outstanding debts.
- Reference checks: This type of check involves contacting an individual’s references to verify their employment history and character.
The cost of each type of background check can vary, with criminal background checks typically being the most expensive due to the extensive research and resources required.
Private Investigator vs. Online Background Checks
Another factor that can impact the cost of a background check is the method used to conduct the check. Private investigators often charge a higher fee for their services, as they have access to more in-depth information and have the expertise to analyze and interpret the data.
On the other hand, online background check services are typically more affordable, but may not provide as comprehensive of a report as a private investigator. It’s important to carefully consider the level of detail and accuracy needed for your specific background check needs when choosing between a private investigator and an online service.
Additional Fees
In addition to the cost of the background check itself, there may be additional fees associated with the process. For example, some states require a fee for accessing criminal records, and some online background check services may charge a fee for expedited results.
The Consequences of Not Conducting Background Checks
While the cost of background checks may seem high, the potential consequences of not conducting them can be even greater. Here are some of the risks associated with skipping background checks:
Hiring Unqualified or Dishonest Employees
One of the main reasons companies conduct background checks is to ensure they are hiring qualified and honest employees. Without a background check, you may end up hiring someone who is not qualified for the job or has a history of dishonesty.
This can lead to a decrease in productivity, damage to your company’s reputation, and even legal issues if the employee’s actions result in harm to others.
Negligent Hiring Lawsuits
If an employee causes harm to others due to their past actions or behaviors, the company may be held liable for negligent hiring. This means that the company could be sued for not properly vetting the employee before hiring them.
In these cases, the cost of a background check is minimal compared to the potential legal fees and damages that could result from a negligent hiring lawsuit.
Loss of Customers or Clients
If a company hires an employee with a history of dishonesty or criminal behavior, it can damage the company’s reputation and lead to a loss of customers or clients. This can have a significant impact on the company’s bottom line and long-term success.
Can You Sue for Not Getting a Job Due to a Background Check?
In some cases, an individual may be denied a job due to information found in a background check. This can be a frustrating and disappointing experience, but can the individual sue for not getting the job?
The answer is not a simple yes or no. It depends on the specific circumstances and the laws in the state where the job was denied. In some cases, an individual may be able to sue if the background check was conducted improperly or if the information used to deny the job was inaccurate. Companies should maintain an Adverse Action process, which gives a course of action for challenging incorrect background check data.
However, if the background check was conducted legally and the information used was accurate, it may be difficult for the individual to successfully sue for not getting the job.
How Much does a Background Check Cost
When determining the cost of a background screening, several factors come into play. The type of background check being conducted, the method used to perform the check, and any additional fees can all influence the overall cost.
Typically, criminal background checks tend to be the most expensive due to the extensive research involved. Private investigators may charge higher fees compared to online background check services like The Screening Source, LLC., which are usually more affordable.
In addition to the base cost of the background check, there could be extra fees associated with accessing certain records or expediting results. It’s essential to consider the level of detail and accuracy required for your specific needs when evaluating the cost of a background screening.
How to Reduce the Cost of Background Checks
While background checks are an important part of the hiring process, there are ways to reduce the cost without sacrificing the quality of the check. Here are some tips for reducing the cost of background checks:
Conduct Only Necessary Checks
Not every job requires the same level of background check. For example, a job that involves handling sensitive financial information may require a credit check, while a job that involves physical labor may not.
By carefully considering the specific job requirements, you can determine which types of background checks are necessary and avoid unnecessary costs.
Use Online Background Check Services
As mentioned earlier, online background check services are typically more affordable than hiring a private investigator. These services can provide a comprehensive report at a fraction of the cost, making them a cost-effective option for many companies.
Negotiate with Background Check Providers
If you are using a private investigator or a background check company, don’t be afraid to negotiate the cost. Many providers are willing to work with you to find a price that fits your budget.
Conclusion
While the cost of background checks may seem high, the potential consequences of not conducting them can be even greater. By understanding the true cost of background checks and taking steps to reduce the cost, you can ensure that your company is making informed hiring decisions and protecting itself from potential risks.