Screening new hires and properly storing documents is becoming increasingly important for small businesses, and if your hiring department is neglecting the process, the costs could prove significantly detrimental.
During a recent Small Business Spotlight survey studied 593 small businesses and found that for many of them, looking into a new hires background helped them catch an issue they otherwise would not have. This is significantly important when hiring and Form I-9 compliance are on the line. The government can hit businesses hard for noncompliance when it comes to ensuring an individual is authorized to working in the U.S.
Background checks often uncover problems
The report indicated that 64 percent of the respondents had found out an individual had lied on his or her resume or application after running a background check, and 54 percent reported that they found out something they would not have otherwise found had they not screened the new hire. You shouldn't be hiring people if you're not even 100 percent sure about they're citizens or not - it becomes too easy to run into problems. When between half and two-thirds of hiring managers are uncovering problems during background checks, it stands to reason that you should do the same.
Your typical background check should include the opening of an E-Verify case, the completion of the Form I-9, a criminal history check and a verification of previous employment and education. If you're not taking care of this on a regular basis, there's a chance that you could run into problems. This is why you should mandate background screening during hiring, and ensure that your human resources department is up-to-date on the latest regulations.
Just over half of the survey's respondents reviewed their hiring policies on an annual basis, while 17 percent indicated that they never do so. Reviewing hiring policies through processes such as an internal audit are a good way to ensure compliance, and a chance to iron out any wrinkles in your background screening methodology.
Non-compliance can lead to big fines
This is vital, especially for businesses on the smaller side, such as those surveyed, because of the costs that non-compliant companies can incur. Companies that employ someone not authorized to work in the U.S., who can't show that they did the requisite work to determine work eligibility, can be subjected to fairly massive fines depending on the scope of the violation. The minimum penalty for a first time offender is $375 per violation, while the maximum is $3,200. The fine increases for each offense. By the time a business is classified as a third time offender penalties for hiring someone not authorized to work in the U.S. range from $4,300 per employee to $16,000.
If your background check process isn't airtight, a few people skate by the hiring process with false information and the government finds this out and determines that you didn't have enough checks in place to verify whether the individual was eligible to work in the U.S. could mean trouble. This is why hiring managers should ensure their departments are running a perfect hiring mechanism, and always stay up-to-date on changes to hiring requirements.
However, some businesses aren't reviewing their hiring processes as much as they should, many indicated that an I-9 audit wouldn't present a problem for them. The recent survey found that 62 percent of small businesses indicated that they felt prepared for an audit. In contrast, only 5 percent responded that they were not ready, while 33 percent indicated partial preparation. Companies should ensure that they are always prepared for an I-9 audit.
Storing documents in the best way possible
Part of making sure your business is prepared for a review of hiring processes and documents may be switching to a different form of I-9 storage. Only 8 percent of the businesses questioned in the survey indicated they utilized an electronic storage system for their Form I-9s. Meanwhile, 53 percent store their Form I-9s physically. While it is okay to store either way, companies that utilize a digital means to store their hiring documents may be less apt to making mistakes.
Electronic storage systems contain features that make documents easily searchable for retrieval during audits and simple to revise. Additionally, some programs will inform you when you've entered the wrong information into a field. Features such as this will ensure you don't lose vital documents, or make mistakes while filling them out.
Small businesses should work hard to update technology to streamline hiring and screening processes, ensure security and avoid compliance mistakes. Technologies such as electronic storage programs for the Form I-9, as well as E-Verify, will ensure that you're always hiring smart, and that your company maintains perfect compliance.