Background Checks for the "Gig" Economy
The fast growing “gig economy”
that focuses on temporary work – or “gigs” – such as transportation applications such as Uber and house sharing services such as Airbnb accounted for 30 percent of new jobs and created new income sources for 2.1 million people in the U.S. between 2010 and 2014, according to a 2015 American Action Forum Report
. The fact that employers will need to strengthen background screening for the growing on-demand workforce in America although the process may require a different approach than what is used in the full-time economy to ensure safe workplaces is a growing trend
The gig economy shows no sign of slowing. According to a report from Intuit
, 7.6 million people will be part of the on-demand gig economy by 2020, and that slice of the labor market will grow by 18.5 percent per year over the next five years. The Intuit report also revealed a broader trend in the U.S. within the “contingent” or “independent contractor” workforce which has grown “from 17 percent of the U.S. workforce 25 years ago, to 36 percent today, and is expected to reach 43 percent by 2020.”
To keep up with the gig economy, firms that supply on-demand workers need to process a great many individuals very quickly. As a result, the ability of a background screening firm to leverage the latest technology becomes critical so that firms may quickly process peer to peer workers.
Employment Screening Solutions (ESR) provides state of the art technology and integrations that can assist an on-demand firm in meeting these needs. ESR has long provided on-demand firms with advanced integrations utilizing a RESTful JSON API to seamlessly build an engine to enable background checks that are both accurate and fast. To learn more, visit the ESR Background Check API
Background Screening of On Demand Workers
In the “gig economy” — sometimes also referred to as the “sharing economy” or the “Peer to Peer” (P2P) economy — a consumer is able to “rent” or share assets owned by someone else. Advances in technology have enabled such sharing to occur by providing real-time information to both providers and users and some technology companies take the position that they are enabling the service but not actually providing it. However, a problem with the sharing economy is that even though technology firms provide solutions to enable peer to peer sharing, the public, legislators and regulators are concerned that without background checks, users of these services can be harmed. Even though the technology firms deny they are service providers, safety concerns are still paramount.
These types of background checks fall outside the traditional employer-employee situations but are nevertheless critical as users of these services are concerned with the integrity of the service providers. However, the standards for what constitutes a background check remain elusive since there is no one definition or generally accepted standard. In determining how much effort, money, and energy to put into background screening non-traditional workers in the gig economy, employers should consider two factors:
Use consistency. The same level of screening used for similar positions should be used for a position that is to be filled by a non-traditional worker or else the firm may be subject to allegations of disparate treatment of similarly situated people.
The duty to hire with due diligence. This basic rule still applies. An employer is negligent if they hire someone who the employer either knew or should have known, in the exercise of reasonable care, was dangerous, unfit, or not qualified for the position.
However, there is no national standard for background checks in the gig economy. Even though companies that facilitate Peer to Peer activities have a vested interest in assuring consumers that their service is safe, there continues to be no national standard as to what constitutes an appropriate background check in the sharing economy. Each provider is free to establish its own criteria. As the gig economy grows, stories of consumers being harmed by criminal acts of providers can be expected to increase. Given the negative fallout from such publicity to any firm in the Peer to Peer space, it would seem that an effort to create some standardized and generally accepted background screening protocols would be of great benefit to both providers and consumers.
Background Screening of Extended Workforce
Many employers do not realize they may face the same risk exposures from temporary employees from a staffing vendor, independent contractors and vendors that they would with their own employees. The law is clear - if a non-employee working on behalf of a business harms a member of the public or a coworker, the business can be just as liable as if the person were on the business’ payroll. Some companies that claim to do background checks may perform an inferior, inexpensive background check that falls below acceptable standards, still putting an organization at risk.
ESR’s electronic process supports different types of engagements making it easy to ensure staffing vendors, independent contractors and vendors have screened their employees under a program that meets minimum requirements. Questions for Extended Workforce screening include:
Have all onsite workers have undergone a background check?
Have onsite workers been checked to the same or comparable standard as direct employees?
Is the background screening company used to perform the background check accredited?
What is the experience and competency of the screening firm?
What types of searches were run?
Benefits of Extended Workforce screening include:
Achieve 100% compliance with company screening policies and regulatory requirements.
Increase oversight of all programs.
Ensure the screening of all onsite workers is consistent and meets company standards.
For temp to hire situations, the employer will know the temporary worker has passed an acceptable background check before investing time in that employee.