When Employers Lose Sight of the Importance of Background Checks in a Gig Economy

The "gig economy," characterized by the rise of companies such as Uber and Postmates, has transformed more than just the taxi and delivery industries; it has had a profound effect on the concept of the employee. Many businesses eschew the idea that they are in any way traditional employers, rather referring to their workers as "contractors." By keeping the workers staffing their services at arm's length, companies attempt to limit their legal liability—and according to an opinion piece published by Info Security Magazine, they're eroding public trust in the process.

Gig-based companies have a reputation for deploying background check processes that are lacking in thoroughness. Look at Uber, a company with background check procedures that have evolved over the past several years, often in response to controversy. The greatest appeal of the gig economy, according to the piece, is also its central danger: almost anyone can secure a gig of some kind, and few companies have implemented vetting procedures that reflect this reality.

The article alleges that problems develop when companies rely on background checks that are not thorough, relying instead on a quick, initial look at an applicant’s suitability. These companies may not implement policies that are designed to safeguard their workforce and customers over the long-term. By taking only a quick look at each applicant, businesses may miss relevant deeper details, particularly when they pertain to applicants who seem acceptable on the surface. 

The article points to numerous incidents in which employers have discovered that vetted drivers, delivery personnel, and even medical care providers have criminal records or expired licenses—but only after the employees have committed crimes on the job. 

With a rising number of incidents and few legal repercussions for the companies that approved those individuals, the public is losing trust. That erosion of confidence comes with expensive consequences, such as the more than $2 trillion that the article cites is lost globally each year based on a lack of trust between businesses and consumers. While that number isn't entirely attributable to the gig economy, it tells an important story: lose the trust of the public through high-profile failures of due diligence and you’ll pay the price. 

How can businesses adapt and respond without losing out on the bottom-line benefits of gig workers? 

The answer: stricter and more thorough vetting procedures that focus on continued compliance rather than a cursory, one-and-done look at an individual's history. Periodic license verifications, including the services available through backgroundchecks.com, should take place for accredited professionals, and ongoing monitoring can alert employers to any change in a worker’s criminal status.

A more rigorous initial approach, including the use of qualified tools such as backgroundchecks.com's multi-jurisdictional US OneSEARCH, can improve safety for businesses and consumers. While it seems as though the gig economy is here to stay, there is much room for growth and improvement: for businesses to survive and thrive in this new environment, sound and reliable vetting procedures must take priority. 

Michael Klazema

About Michael Klazema The author

Michael Klazema is Chief Marketing Technologist at EY-VODW.com and has over two decades of experience in digital consulting, online product management, and technology innovation. He is the lead author and editor for Dallas-based backgroundchecks.com with a focus on human resource and employment screening developments.

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