Extended Workforce Screening – An Essential Solution for an Ever-Changing Workforce
Extended Workforce Screening solutions make it easy for organizations to implement and manage a consistent screening standard across their contingent workforce.
The percentage of people working on a freelance or contract basis is consistently growing. A 2020 Mastercard Report predicted that by the end of 2023, the gig economy will be worth $915 billion globally. During the COVID-19 pandemic, more companies have been utilizing a contingent workforce – in part made possible by the widespread pivot to remote working. A recent Gartner report shows that nearly a third of companies replaced salaried employees with contingent workers to cut down on costs. Additionally, estimates show that by 2027, just over half of the U.S. workforce will be comprised of contingent workers.
In this blog, we’ll talk about the pros and cons of utilizing a contingent workforce, the importance of screening non-employee workers, and the benefits of a consistent extended workforce (including "contingent workers" or "contract workers") screening process for organizations worldwide.
Contingent Workers: The Benefits
In this time of economic uncertainty, the upswing in hiring contingent workforces makes sense for many employers. Bringing on full-time employees can be a costly exercise – one that the utilization of contract workers can help to mitigate. Using contingent workers can present many significant advantages. It may help:
minimize the time investment of the HR team and hiring manager, who may not need to post job listings, review resumes, conduct interviews, or put new employees through a company’s full HR onboarding process. This also decreases time-to-hire for the company, which can be critical in helping to quickly fill openings.
reduce the need to manage employee benefits, payroll taxes, unemployment compensation, and other employee-related expenses.
eliminate the need to hire, onboard, and then downsize to accommodate seasonal surges that necessitate ramping up and scaling back on a regular basis.
afford the company the opportunity to demonstrate greater flexibility – a trait shared by many resilient organizations.
bring on workers with specialized skills that would otherwise take too long for an internal team to source.
Contingent Workers: The Risks
There are two sides to every coin; relying on a contingent workforce is not without potential disadvantages.
Contingent workers may require access to company resources and data, financial intelligence, and confidential customer or patient information, posing the risks of fraud, theft, and reputational damage.
Without a long-term commitment, a contract worker may not have the same sense of loyalty to your company; this can be particularly worrisome if they’re working with sensitive information, as an appropriate level of trust may not yet have been established.
Employers may have less visibility into what their contingent workers doing (particularly those working remotely); if your management team is more comfortable with a close collaboration with employees, it may be difficult for them to trust a non-employee to properly execute their wishes.
The Importance of Screening your Extended Workforce
Background screening can be a valuable tool in an attempt to mitigate the risks involved with this important segment of the workforce. Just as many employers screen their permanent workforce, contingent workers may need to be vetted as carefully as traditional employees. HireRight’s 15th Annual Benchmark Report (2022) revealed that businesses are seemingly becoming more cognizant of the importance of background screenings for contingent workers. The report broadly showed year-over-year increases in the percentages of respondents who screen their temporary/contingent workers, independent contractors, interns, and volunteers throughout North America, Europe, the Middle East, and Africa (EMEA), and Asia-Pacific (APAC) – for example, 67% of EMEA respondents in 2022 said they screened their temporary or contingent workers, up from 56% in HireRight's 2021 survey. Yet despite the risks, there is still a sizable percentage of employers that select not to screen their extended workforce, creating an avoidable gap in their workforce risk mitigation efforts.
The Need for a Consistent Background Screening Standard
Even companies that require background checks for contract workers may face issues that complicate matters and can create inefficiencies. Many large companies hiring contingent workers across a diverse geographic footprint rely on a range of employment and staffing vendors. These agencies, in supplying contract workers, may handle background screenings themselves. And if even if each of those vendors run the same types of checks (e.g., employment verification), it doesn’t mean that they’re contacting the same types of sources, following the same processes, and adhering to the same timelines. This can create unwelcome opportunities for inconsistent screening standards and can lead to an inefficient extended workforce management process. Inconsistent background checks may result in contingent worker screening that might not meet your company’s standards. Candidates who do not meet your organization’s requirements and needs might slip through the cracks and, at best, become your weakest link. At worst, they could put your organization and your customers at risk.
Extended Workforce Screenings: An Aligned HR Process with HireRight
HireRight’s Extended Workforce Screening (EWS) solutions help employers by providing them a way to set up and control consistent screening standards across their vendor base. As you invite vendors to register online for their own account, they’ll undergo HireRight’s onboarding and credentialing process. Once complete, they can access our comprehensive range of screening services on our global platform. Your company will stipulate which specific background screenings should be performed, and vendors can easily order and manage those services. When your vendors use your pre-determined screening solutions on the HireRight platform, you know they’re following consistent screening standards, creating a level of consistency that can help to mitigate risk.
EWS provides a uniform screening experience for vendors and candidates, no matter their location. It also provides employers with the oversight and control they need, along with the ability to communicate with all vendors, review screening statuses, and view program statistics – all from their own account. Our EWS solution is easy to use and provides a seamless experience that benefits both the employer and their vendors.
Release Date: May 23, 2023
HireRight is a leading provider of on-demand employment background checks, drug and health screening, and electronic Form I-9 and E-Verify solutions that help employers automate, manage and control background screening and related programs.