How Employment Verification Impacts Your Background Check

When you're in the process of hiring, or perhaps looking for a new job, one of the most crucial elements that can determine the outcome is a background check. While background checks can include a variety of elements such as criminal history, credit checks, and drug screening, employment verification plays a pivotal role in confirming an applicant’s qualifications and trustworthiness.

But why is employment verification so important? And how does it impact the background check process? Let’s take a closer look.

What Is Employment Verification?

Employment verification is the process of confirming the employment history of an individual. This includes verifying the details of their previous jobs, such as:

• Job titles: Was the applicant actually employed in the role they claim?

• Employment dates: Did the applicant work for the duration they said they did?

• Salary information: How much did the applicant earn in their previous positions?

Employers often rely on background screening companies to handle this process, which typically involves contacting previous employers or accessing third-party databases.

Why Is Employment Verification So Important?

• Ensures Accuracy and Trustworthiness

One of the most common reasons for conducting employment verification is to ensure the accuracy of the applicant’s work history. Job seekers, whether intentionally or accidentally, may exaggerate their qualifications or work experience. A thorough employment verification will help prevent a candidate from fabricating key details.

By verifying the employment history, you ensure that your organization is hiring someone who has the skills, experience, and qualifications they claim. This not only builds trust between the employer and employee but also ensures that your team operates at its best.

• Helps to Prevent Fraud

Resume fraud is unfortunately a prevalent issue, with candidates sometimes inflating their job titles, length of service, or job responsibilities. Employment verification is a critical step in rooting out this type of fraud. When candidates falsify their job history, it can undermine the integrity of your hiring process and potentially introduce risks to your company.

• Mitigates Legal and Financial Risks

Failing to properly verify an applicant’s employment history can lead to significant legal and financial consequences. For instance, hiring someone who doesn’t have the required qualifications could result in performance issues, potential lawsuits, or even regulatory fines, depending on the industry.

On the other hand, if you mistakenly hire someone based on false information, you may be at risk of financial loss due to poor performance or, in extreme cases, fraud.

• Reduces Employee Turnover

A good fit isn’t just about the technical skills a candidate brings to the table. Cultural fit and work ethic are just as important. By accurately verifying an applicant's past job experience, you can gauge whether their professional behavior aligns with your organization’s values and needs. This can help in choosing employees who are likely to stick around, reducing turnover rates and the cost associated with hiring and training new staff.

How Employment Verification Affects the Background Check Process

• Faster and More Accurate Hiring Decisions

The results of an employment verification can provide clarity and confidence in your hiring decision. If the verification process shows that a candidate's work history checks out, you can move forward with the process more quickly. Conversely, any discrepancies found in the verification can trigger further investigation and may slow down the decision-making process.

• Helps to Avoid Legal Complications

When you’re performing background checks, including employment verification, it’s essential to remain compliant with legal standards. This is especially true with laws like the Fair Credit Reporting Act (FCRA), which dictates how employment verification and other background check data should be handled. Ensuring you perform proper verification can reduce the chance of potential lawsuits and legal issues from disgruntled applicants.

• Increases Candidate Accountability

Knowing that your company conducts thorough employment verification tends to encourage candidates to be more truthful in their applications. Candidates who understand that you will be verifying their past employment are less likely to embellish or lie about their experience. This creates a more transparent and ethical hiring environment.

How to Perform Employment Verification

Employment verification is usually conducted by a third-party screening service, although some employers may handle this process in-house. Here's how it's typically done:

• Contacting Previous Employers: This is the most common way to verify employment. The background check company or employer will reach out to the candidate’s previous employers to verify their job title, duration of employment, and sometimes salary.

• Using Third-Party Databases: Many employers also use databases that store information about employment records. These databases provide a faster and more efficient way to verify employment history.

• Employment Records: In some cases, applicants can provide pay stubs, tax returns, or employment contracts to further support their employment history claims.

What Happens if Employment Verification Fails?

If an applicant's employment verification reveals discrepancies or inconsistencies, it doesn’t necessarily mean the applicant will be automatically disqualified. However, it does signal the need for further investigation. In some cases, candidates may be asked to explain the discrepancies, while others may face rejection outright if the discrepancies are significant.

Employers may also choose to rescind job offers if a background check shows major inconsistencies between the resume and the applicant’s actual work history.

Conclusion

Employment verification is a crucial component of the background check process. It ensures that the hiring process is transparent, helps prevent fraud, and minimizes the legal and financial risks for your business. By carefully confirming the accuracy of an applicant’s employment history, you can make more informed decisions, which ultimately helps in building a stronger, more reliable team.

Whether you’re hiring for your organization or going through the process as a candidate, understanding the role of employment verification is essential for ensuring the integrity and effectiveness of the hiring process.