The Case for Background Checks on Vendors, Contractors and More

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The Case for Background Checks on Vendors, Contractors and More

Everyone knows that they should be performing background checks on their employees. Background checks promote safety, reduce turnover, and help ensure that you have the best possible employee performing your tasks and working with your clients. It’s really a no-brainer.

So why wouldn’t you require that background checks be performed on your vendors, contractors, and other non-employee workers?

These individuals are just as responsible for making sure that your company is successful and, depending on the service they’re providing, may have equal or greater opportunity to prey on your business than any one of your direct employees. The risks are as real as with a direct employee, so the background checks should be as robust.

Still, we’ve found that businesses tend to shy away from requiring suppliers to perform background checks because of the perceived logistical and legal issues, even though these are easily overcome.

Perceived Logistical Issues

A lot of background screening companies offer some sort of vendor or non-employee screening programs, but the systems are convoluted. They’re made to fit within the background screening company’s framework rather than being made to fit what makes sense for your business.

The typical system relies on the sponsor company – the one for whom the work is being done – running the reports with their chosen screening company and charging their vendor for all associated costs. It puts the burden squarely on the sponsor company. However, there are other companies that provide these checks in such a way that the vendors themselves are responsible for the cost, allowing for flexibility and cost deferment for the sponsoring company.

Once the check is finalized in a process like this, the vendor can provide a completion certificate to the sponsor company. The completion certificate includes the individual that was screened and the checks that were run.

Perceived Legal Issues

The major concern with requiring your vendors to perform background checks is the co-employer conundrum. By requiring that background checks be done, and by dictating what constitutes an acceptable risk (and therefore who should be hired), you could be held liable as the candidate’s employer if it came to a lawsuit.

That’s why the system proposed earlier is ideal. You can require that background checks be done – even specify which checks and ensure that they’re using an organization that you trust – and receive confirmation that the checks are done. But by leaving the final decision in the hands of the actual employer rather than the sponsoring company, you can’t be held responsible for EEO or negligent hiring claims. The balance gives you the best of both worlds.


*GIS | HireRight’s Blog is provided for informational purposes only and should not be construed as legal advice. Any statutes or laws cited in this article should be read in their entirety. If you or your customers have questions concerning compliance and obligations under United States or International laws or regulations, we suggest that you address these directly with your legal department or outside counsel.

By | 2018-09-11T09:07:21+00:00 September 11th, 2018|Consumer Information, Product Information, Tips and Tricks|0 Comments