Sector Report: Navigating the Patchwork of Screening Regulations

Background screening is often considered the most tedious and stressful aspect of the recruiting process. While it will never be a pleasant experience, companies and vendors are focused on making it as painless as possible. “If recruiting gets bogged down during background screening you run the risk of losing candidates — and all the resources you spent recruiting them in the first place,” said Dawn Standerwick, vice president of strategic growth for Employment Screening Resources, a background screening company in Boulder, Colorado. You also the run the risk that they will complain about the process to friends and colleagues, said Richard Seldon, president of Sterling Talent Solutions, a global background screening company in New York. “Companies want candidates to say the process was efficient, timely and easy to do.”

That’s driving screening vendors to integrate their technology with applicant tracking systems, onboarding, payroll and other solutions to streamline the process, reduce wasted time, and eliminate demand for redundant information. They are also adding automated alerts and update features, including texts and emails letting candidates know where they are in the process, whether information is missing, and how they can access their background report. “A little extra communication makes the process more transparent,” Standerwick said.

It also shortens the screening process by auto-loading data, and alerting candidates immediately if more information is required. “Speed is always a good idea,” Seldon noted. “Companies and candidates always want this process to go faster.”

Along with improving candidate experience, screening vendors and companies continue to struggle with many of the same issues that have plagued them in the past — varying laws, ban the box movements and the need for global solutions. All of these trends have one important theme in common: lack of consistency.

In the case of screening laws, every county, city and state has its own requirements for what can and cannot be considered in a screening, how many years back screeners can look, and what kinds of notifications companies need to provide candidates about this process. “The patchwork of regulations has heightened the environment of lawsuits and litigations, and employers are looking for more guidance from their providers,” Standerwick said. Some vendors are taking on increasing responsibility for providing disclosures and notifications that are legally the employer’s responsibility, while others are “leaning back,” she said. “It’s getting increasingly complex to manage, and not every vendor wants to take that responsibility on.”

The same is true for ban the box rules, which vary in terms of when it is permissible to ask for a criminal history in the application process, what notifications are required and how to handle actions if information disqualifies a candidate. The rules get even more complex if a candidate lives in one state but will be employed in another, Standerwick noted. “We are reaching the tipping point with ban the box.” It’s not only complicated, it can actually do more harm than good. If the recruiting process drags out for weeks only to have the candidate disqualified, it delays that person from finding a job and the company from filling a position. “It’s creating a lot of frustration.”

Going Global

Managing laws gets exponentially more complex for global companies or those seeking candidates abroad, Seldon said. Often, HR leaders aren’t certain how they handle screening in other countries or they rely on local HR teams to establish their own rules. But as the risk of lawsuits increases, and new data privacy rules emerge — like the General Data Protection Regulation, or GDPR, in the EU — companies are realizing they need a more consistent approach, he said. “The focus on global solutions has gained a lot of momentum this year.”

Not many screening companies have a global presence, though. As companies seek out vendors to manage global talent programs, the larger vendors are likely to expand their footprint through acquisition of local screening firms or through organic growth. “Global companies expect global solutions,” he said.

Going forward, companies should speak to their screening vendors about how they plan to address all of these issues and what is on their technology road maps. “Every company’s needs are different based on their industries and the positions they are screening for,” Seldon said. The more companies can educate themselves about screening laws and opportunities for risk in the screening process, the better able they are to choose vendors who can meet their needs.