The Power of Background Checks

One of our cardinal beliefs at Onfido is that our product can build trust between job applicants and their prospective employers. We aren’t trying to stand in the way of people looking for a job – we want to work with them to show they are trustworthy and strong potential additions to a team. There is compelling evidence that shows that background checks can do precisely that.

The first thing to emphasise is that background checks can be seen as rewarding job applicants for positive behaviour, rather than punishing others. This article in the Washington Post on James B Jacobs’ new book, *The Eternal Criminal Record, *makes that clear:

Indeed, it could be persuasively argued that public policy should favor treating a clean criminal record as a plus factor for public and private hiring, a kind of benefit to reward and encourage good citizenship.

In Jacobs’ book, he goes on to argue that it is the responsibility of the estate to ensure that those with criminal histories are treated fairly, by ensuring high-record keeping standards and giving offenders real opportunities to demonstrate rehabilitation and wipe away long-past history of criminal conduct. This is a particular problem in the United States: in the United Kingdom the Rehabitation of Offenders Act dictates the way in which criminal convictions become ‘spent’ in the period following conviction, and can no longer be held against offenders in the pursuit of ordinary employment. In the United States no federal equivalent exists. This article on ‘Redemption’ in an Era of Widespread Criminal Background Checks’ shows one way to go about drafting such a law by showing at what point the rate of recidivism for offenders meets the national average.

There are other positive social benefits to background checking than just rewarding good citizenship. This article, published by the University of Chicago Press, establishes that background checks significantly improved employment outcomes amongst African Americans in a range of businesses in different cities in the United States.

The study found that this is because, if employers do not possess reliable information about individuals, ‘[some] employers use race, gaps in employment history, and other perceived correlates of criminal activity to assess the likelihood of an applicant’s previous felony convictions’. Background checks can pull away this veil of ignorance, replacing it with dependable information that allows employers to judge potential employees on their individual merit.

Although the Perceived Criminality study demonstrates that background checking reduces employment opportunities for those with serious or pertinent criminal convictions, it also demonstrates that their effect in cancelling preconceptions cancels out that harm.

The positive effects on the hiring of racial minorities should not be understated. These are the most important findings of Holzer, Raphael and Stoll:

‘Employers that check are 8.4 percentage points more likely to have hired an African American applicant into the most recently filled position. Among employers willing to hire ex-offenders, this difference is 4.8 percentage points and is marginally significant. Among employers who are unwilling to hire ex-offenders, this difference is 10.7 percentage points and is highly significant…The percent of applicants who are African American at firms that check is nearly 13 percentage points greater than the comparable percent at establishments that do not.’

This tells us a lot about what background checks have the power to do. One way to think about background checks is from the perspective of risk, by considering what might happen if employers choose not to perform background checks on their employees. Here we see that background checking can be an instrument for ‘bridging the trust gap’.

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Rob was Head of Research at Onfido. Having left a lasting imprint through his work during the early days at Onfido, he's now gone off to solve the world's other problems in the US.