Most organizations are familiar with the concept of completing background checks on their employees but many wonder if they can also conduct a background check on contractors. Contractors here are defined as those individuals the organization may engage to perform specific services for their customers such as repair, delivery, or installation services. These contractors are engaged as part of their service model and are often considered part of a service network or fleet for the organization. The short answer is yes, you can conduct background checks on contractors but there are a few things to keep in mind.
The relationship an organization has with its contractors is different than the more typical direct-hire relationship with an employee but the risks are no less significant than those the organization is exposed to through employees. In some cases, they may even be greater because of the indirect relationship they have. For this reason, it is important the organization to create requirements and programs that cover any contractors they may engage. Setting a consistent standard, and even making it a contractual requirement with the servicing company to be eligible for work from the organization, is a great way to ensure the program is followed.
Having a defined and consistent program is important to ensure compliance with the organization’s desire to complete background checks on contractors. Simply leaving it up to the contractor or servicing company to determine what type of check is needed, how often, and even what information is important is a sure way to create issues with the original intent of such a program. The organization should stipulate what type of searches need to be completed on each contractor – for example, county criminal record checks where the individual has lived for seven years, driver record check, sex offender records check, or even a drug test – means there is no subjectivity on the part of the individual contractor or servicing company to decide what is required.
All searches done when a background check is completed on a contractor are based on accurate information related to their name, date of birth, and even addresses. If any of these details are incomplete or incorrect, the quality of the result will be impacted. Since the relationship between the contractor and organization is an arm’s length arrangement with the contractor’s servicing company being their direct employer, there is no time where the organization will meet the individual. For this reason, it is important to ensure there is a step in the background check process where the identity and demographic information of the contractor are verified.
Once the background check on the contractor is completed, the organization should also have a clear and consistent method to review the results to determine what information will be relevant. For the organization, the main focus is to mitigate risk – financial, legal, operational, and reputational – and the individual contractor’s direct employer will be more concerned about skills and qualifications. For this reason, the record checks mentioned above – criminal, driving, and sex offender – will be what provide the most useful information. Not every criminal record will be a barrier to eligibility for the contractor however, there are several factors to be considered.
The impact of the criminal record is determined by reviewing the nature and gravity of the offense(s), the length of time since the issue(s) occurred and the individual’s age at that time and the relevance of that record to the role the contractor will hold.
For example, a bar fight that occurred 15 years ago when the contractor was 18 years old should be reviewed differently than multiple theft and larceny issues that have occurred over some time up to last year. The latter would be considered more relevant for an individual working as a contractor in a mostly unsupervised, in-home environment.
Protecting consumers is a key priority for organizations that implement a program for a background check on contractors. It sets a clear standard, improves the professionalism of the organization’s network, and ensures a robust answer when an issue arises related to the service network an organization utilizes. There is no guarantee or answer to eliminate all risk but being able to demonstrate due diligence regarding the contractors used is underscored by the ability to screen your network and also lends credence to the fact that you should screen them.
Contents are provided for information purposes only and should not be construed as legal advice. Users are reminded to seek legal counsel with respect to their obligations and use of PlusOne Solutions services.
PlusOne Solutions has been an industry leader in the risk management field by specializing in compliance programs that meet the complex challenges of geographically dispersed contractors, vendors, and employee networks. PlusOne Solutions protects companies from possible financial, legal, and reputational risks associated with contractor and vendor relationships while creating safer work environments. To learn more, visit https://www.PlusOneSolutions.net.sign up for the newsletter. Questions or comments? We want to hear from you.
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