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Background-Checking firms: How to Sort out the Best from the Rest

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in Employment Background Check,Hiring,HR Management,Human Resources

Not too long ago, just a few dozen companies offered background-checking services. But the industry mushroomed in size and scope—but not necessarily quality—after post-9/11 security concerns, and ethics scandals drove up the demand for increased background screening.

The result: Nearly 1,000 vendors are in the screening industry now, making it difficult to sort out the top tier from the fly-by-night firms. Many sell cheap but incomplete background checks in minutes. Too often, they simply restate old information bought from private data brokers with no guarantee the data are current or correct.

The top four players in the industry—USIS, First Advantage, ChoicePoint and Kroll—account for about $1.4 billion of the nearly $3 billion industry. What about the others?

Good news: Starting this month, you’ll have a new yardstick on which to gauge their quality.

The National Association of Professional Background Screeners (NAPBS), a 650-member industry group, is set to unveil a comprehensive, six-pronged certification and accreditation process. The goal: Identify “gold standard” pre-employment screening firms that excel in the areas of consumer protection, legal compliance, client education, data quality, verification and business practices.

The new standards are expected to address a longstanding HR concern: the absence of a concrete benchmark to vet and verify the quality of the background screeners.

Outlook: Expect this new certification to lead to a shakeout of sorts in the industry, with weaker players losing out to stronger counterparts that earn the certification label.

Advice: When choosing a background-screening provider or renewing your current one, look for NAPBS certification (www.napbs.com).

Then, ask potential screening providers about their accuracy, specifically their error rate and resolution rate. It’s information they don’t always give out, but it’s important criteria to judge diligence, compliance and abilities concerning the background reports they provide. 

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