A Gartner survey of more than 800 HR leaders showed that 32% of organizations are replacing full-time employees with contingent workers as a cost-saving measure. That number is likely to increase as the COVID-19 vaccine rollout continues and more companies ramp up hiring for a post-pandemic marketplace, depending on how economic recovery plays out.
The economic uncertainty of the pandemic caused record unemployment levels in early to mid-2020. It also introduced many workers to nonstandard work models, like gig, contractor, and other on-demand talent (ODT) roles. These contingent, flexible staffing models benefited both employer and employee. Employers could expand or contract their workforce based on demand, and do so quickly. Employees signed on to ODT platforms and were able to match with employers and roles at a speed impossible in a traditional job marketplace.
While we tend to think of contingent workers narrowly—temporary entry-level office roles via staffing agencies, gig workers driving for Uber or Lyft or delivering DoorDash and Postmates, or freelance contractors (1099 workers) operating either on their own or via a platform for freelancers like Fiverr, the industries that are most popular for gig workers might surprise you.
According to research from The Gig Economy Data Hub, the top three industries for gig economy workers are Business Services (20.6%), a diverse category that includes accountants, architects, janitors, and administrative support workers; Construction (17.2%), and Education and Health Services (14.2%). Online platform technology has made new forms of work possible, and as this and related technologies develop, they are likely to continue to shape the workforce and contribute to changes to the gig economy.
Despite the fact that contingent staffing spans such a wide range of industries, many companies are forgoing screening for contract or flex workers, even though these workers have the same access that direct employees do to internal company information, data, work sites, equipment, and they work alongside non-contingent employees. Skipping background checks for contingent hires can negatively impact your company culture and your employees’ safety as much as it would for your “permanent” hires.
Background checks are important for these groups. The accelerated hiring process with contingent workers can lead to risks such as hiring someone who doesn’t have the right skills, education, certifications, or is non-compliant in terms of background checks. While staffing agencies frequently assure their customers that the temp workers on their platforms are fully vetted, and most agencies do thoroughly screen workers prior to placement, it’s worth gaining additional assurance by running your own checks.
It is important to note that contingent workers have different expectations. One of the benefits of using ODT platforms and staffing agencies is that you can sign up and start earning almost immediately. Staffing companies and other high-volume resources for employers seeking contract or temporary workers are pros at getting information from candidates and turning around background checks quickly, but running your own background checks while a candidate waits for an offer means that you’re going to lose top tier candidates.
The turnaround time to get the results from a background check can range from one or two days for domestic screening to one or two months for international checks. Although some instant background checks are available, these rely on databases that can be incomplete or inaccurate. Instant criminal records databases, in particular, often contain many errors. Working with a vendor partner that specializes in background screening can not only speed up the process, but also ensure a more thorough and accurate report.
Many companies will hire contingent workers on a…well, contingent basis; meaning that the temporary employee may begin working, but the offer only stands if they pass a background check. Depending on the nature of the work, access to proprietary information may be limited during this period of time.
Finally, wherever possible, digitizing the process and integrating identity verification into the background check process is key to speeding your time-to-hire. With remote hires, identity authentication is even more critical as your HR team may not be able to assess the original documents in person, so choosing a vendor partner that uses rapid technology, like Cisive’s IDVerity tool, can help mitigate the risk of fraud.
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