A by-product of the rise of the contingent workforce is swelling ranks of workers with impermanent employment situations. This means hiring organizations are engaging much more frequently in the execution of pre-employment screenings during the onboarding process. The cost of these screens, occurring with greater regularity in today’s contingent-reliant world, has prompted some employers to require candidates to foot the cost of their own background checks and other screens. Is this a best practice? Or does it have negative implications for attracting talent? Here’s some perspective.
In 2010, still in the aftermath of the financial collapse that spawned the Great Recession, nextSource discussed the high costs of applying for work in the manufacturing industry in a trends report. The report concluded that because unemployment was so high, candidates couldn’t afford to walk away from opportunities simply because they felt put off by being made to cover these costs. The report noted,
“Instances of burdensome onboarding and training processes are widely reported. In addition, it is the accepted norm in the industry that expenses involved in contingent labor sourcing - things like drug screenings, physicals and other on-boarding screenings - are not paid for by employers. Many staffing agencies do not absorb these costs either, leaving the expense to fall to the candidate, even in cases where they are not hired. This raises the barrier to entry for many.”
Times have changed though, as the US workforce has returned to near full employment in most industries. Yet, during those vulnerable years of recession, a number of states put laws on the books making it illegal for employers to charge candidates for doing the due diligence that should be part of employers’ cost of business. Today, seven states including Iowa, Kansas, Kentucky, Louisiana. Massachusetts and Vermont have such laws on their books.
However, even in those states, the law only applies to statewide checks where screening is done via a state agency. For those screening at the county level or via multi-jurisdictional databases, the employer is still within their rights to ask candidates to pay part or all of the cost. As with many things in life however, just because something can be done doesn’t mean it should be.
Part of developing a reliable contingent workforce involves taking steps to promote a healthy employment brand. This means protecting the organization’s reputation in the marketplace. Word travels fast about companies perceived as exploitive or even just disinterested in the welfare of its labor force. A best practice for offsetting the not insignificant cost of pre-onboard screenings “splits the difference” with the candidates the employer seeks to engage. Share with prospective candidates this clear and equitable policy: all candidates who wish to apply for open positions must lay out the cost of applicable screenings. Those engaged will be reimbursed for their outlaid expenses in their first paycheck.
This policy serves to ensure those with concerns about their eligibility will think twice about applying since they know what may be discovered by drug, criminal or other screenings. Moreover, this policy demonstrates the employer’s commitment to respecting their workforce by returning the cost to the worker once they have been hired.