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How Checkr uses modern data in background checks to promote fairer hiring practices

  • Today's hiring requires speed and efficiency from employers and sensitivity to applicants' privacy. Checkr does that with its background checks.
  • Tearsheet editor Zack Miller is joined by Checkr's Scott Melman and Argyle's Justin Stolzenberg to talk about how top firms accelerate hiring through technology.
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How Checkr uses modern data in background checks to promote fairer hiring practices

Hiring in this market is super competitive. Like consumers have grown to expect from the companies they buy from, the bar has been raised in the hiring process. Hiring managers need to create good experiences for candidates if they want to be competitive. They must combine good UX with a growing sensitivity to secure applicants’ personal and professional data, too. 

This dynamic is particularly poignant in background checks. Top hiring firms work with Checkr to streamline hiring and also promote more fair hiring practices. That boils down to the data the firm collects and how it accesses and shares it. 

On this episode of the Tearsheet podcast, I’m joined by Scott Melman, director of data acquisition at Checkr to discuss the trends afoot in background checks and how better data, data sharing, and data permissioning are leading to better practices, better outcomes, and fairer hiring practices all around.

Also joining us is Justin Stolzenberg, GM in the background screening space at Argyle, a leading provider of income and employment data that does deep work in financial services.

I’m Zack Miller, Tearsheet’s editor in chief. Tearsheet has partnered with Argyle to create a four part podcast series that explores how different parts of the financial industry are using modern technology and access to new forms of data to power their businesses today and into the future.

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The following excerpts were edited for clarity.

The big points

  1. Competitive Hiring Environment: The hiring process has become highly competitive, and employers must provide a good candidate experience to remain competitive. This includes combining good user experience (UX) with a focus on securing applicants’ personal and professional data.
  2. Importance of Background Checks: Background checks play a crucial role in hiring, and top firms are working with companies like Checkr to streamline their hiring processes and promote fair hiring practices.
  3. Checkr’s Approach: Checkr uses machine learning and AI to produce faster background checks, addressing the need for speed in hiring, especially during high-demand seasons. It also cleans up messy and unorganized data to improve hiring efficiency and reduce bias in the process.
  4. Argyle’s Role: Argyle provides access to income and employment data, automating employment verifications and reducing the burden on candidates and employers.
  5. Future Directions: Checkr is expanding its services, including Checkr Pay (a payroll platform) and Corridor (an employee onboarding platform), to enhance the HR tech stack and further streamline hiring processes.

Scott Melman, Checkr: I’m Scott Melman Director of Data Acquisition at Checkr, which is effectively our supply chain management function. It’s a bit at the crossroads of finance operations, product management, and vendor management.

Checkr was founded in 2014 as an HR technology company and leading background check company whose mission is to promote fair chance hiring.

Making hiring faster and fairer

Scott Melman, Checkr: Checkr’s technology platform uses a lot of machine learning and AI to produce background checks in a very manual industry. Because of all the software that we use, we’re able to produce background checks that are up to 87% faster than the typical background check company. This is especially important during high seasons, when hiring needs to be done quickly and efficiently, and when unemployment is low and the competition for talent is fierce. 

As we use a lot of our software to generate background checks, it allows us to clean up data that is very messy, unorganized, and non-standardized. That allows for better and more efficient hiring practices that remove bias from the process, which allows folks who might otherwise not get jobs to get them.

How the economy is impacting hiring

Scott Melman, Checkr: The competition for talent is incredibly fierce, and customers are really looking to engage their candidates as quickly as possible. The background check is one of the longest pulls in the hiring process, and can really delay folks from getting on the job. And as our customers look to hire as quickly and as efficiently as possible, anything we can do to speed up the background check process, while not cutting any corners to ensure maximum compliance for our customers, that really allows them to supercharge their hiring process.

Checkr’s focus on its customers

Scott Melman, Checkr: Checkr has created a bunch of tools in order to facilitate our customers’ onboarding processes, one of which is we call Checkr Assess, which effectively removes a lot of the bias from the process to only consider potential criminal records that are relevant to the particular job. An easy example is someone might have a DUI record, but that person is actually not going to be driving a car or have anything to do with a motor vehicle for the job that they’re applying for. What we can do is remove that record from the view of the customer, so that they don’t have to make a decision based on that record that is irrelevant to the person’s roles and responsibilities.

Argyle in background screening and employment verification

Justin Stolzenberg, Argyle: I’m Justin Stolzenberg, General Manager in the background screening space here at Argyle — so all things product, partnership, go to market, as it relates to employment verification for Background Screeners.

Argyle provides a consumer permission tool to access income and employment data. Specifically as it relates to Background Screeners, it’s going to be employment verifications to ensure that Scott actually worked at Checkr, where he said he worked. Automating that process that can be largely manual, like Scott was mentioning earlier.

How top employers audit hiring process

Scott Melman, Checkr: The way to think about this is to understand exactly what kind of risk customers are trying to mitigate. That might mean — going back to my example of a motor vehicle record — if the job does not require a candidate to drive a motor vehicle or anything like that, perhaps it’s not necessary for them to even care or understand what the candidate’s driving record looks like.

Customers will typically run a criminal background check. That’s kind of the standard in the industry. Some of the other checks we call screenings are more specific to the job type. So if you’re a truck driver, that we might include a motor vehicle record. If you are more of a white collar worker, that might involve where you went to school or where you previously worked.

Decisioning on which records to pull

Scott Melman, Checkr: We help our clients choose which screenings to do in two different ways. One is we let customers do it themselves. So we have a self service platform, because a lot of customers actually know what they want. They come to us from other background check companies, because they’ve heard the fast turnaround times that we provide. They come to us organically, and they’re able to sign up for exactly what they need to mitigate the risks that they’re trying to solve for. 

Otherwise, we have a full service team that helps understand exactly what risks our customers are trying to mitigate. And we work with them to build a package and reports that are specific to their needs.

Automation and seasonality

Scott Melman, Checkr: For something like an employment verification, especially in a very tight labor market, candidates are going to be very concerned about outreach to an existing employer. If someone is looking for a new job, they’re not necessarily going to want to have a background check company call their current job and say, hey, does this person actually work there? 

And so instead, a platform like Argyle and any kind of automation allows us to give the candidate privacy, to allow them to search for a new job while at the same time giving the potential new employer that risk mitigation tool — that background check — that they’re seeking. So anything we can do with automation to put the power back into the candidate’s hand is something we’re going to be looking into.

How background verification providers use technology to meet hiring needs

Justin Stolzenberg, Argyle: There are multiple options when it comes to employment verification in the space. I think the benefits Argyle brings is that we can be placed in as an option for candidates to use their own data to verify their own employment. And that takes a burden off of both the background screener and that employer who needs to do that verification, because they’re not paying for a costly verification, and they’re not spending their own time and resources to do that verification on their own.

Where Checkr is headed in the future

Scott Melman, Checkr: Checkr right now is primarily a background check company, a fairly large one. But we are much more than that. We have a lot of data. And we have a lot of customers and a lot of candidates who are eager to continue to work with Checkr. To that end, we’re moving into the HR tech stack with two different platforms, one of which is called Checkr Pay, which is exactly what it sounds like. It’s a payroll platform for a lot of folks who are dissatisfied with the platforms that they have today. That product is just getting off the ground. And so a lot of the features there are related to fast and efficient payment of employees, who we’ve recently onboarded through the Checkr platform’s background checks. That is very much on brand for what Checkr is doing: pleasing candidates and employees, pleasing customers and getting them what they need fast and efficiently through automation. 

We have one more platform that we’re working towards. It’s called Corridor and it’s an employee onboarding platform which takes advantage of Checkr’s existing background check platform to speed up the onboarding process, namely taking the information that was already provided to us in the background check process and improving funnel conversion — basically trying to get more folks onboarded to our customers as quickly as possible, trying to reduce friction along the way.

Where Argyle is taking its background verification products

Justin Stolzenberg, Argyle: Argyle got started in the lending and mortgage space. A lot of our data today and a lot of our strengths are on recent employment data and verifications. A lot of what we’re focused on in the future is how we stretch this back — some people may want up to 10 years of employment history. It’s a modular product, so how do we create connectivity and products in order to go back that far in history to automate a larger part of the verification waterfall, as opposed to automating just the most recent verification?

Is consumer-permissioned employment verification product a benefit or a detriment to candidates?

Scott Melman, Checkr: That’s a really good question. So you’re right that Checkr is hyper focused on the candidate experience. We have a very large team based here in San Francisco that focuses exclusively on candidate experience, which is somewhat unique in the industry. Overall, I think it’s a positive, putting the onus on candidates who are interested in finding a new job. They are motivated to facilitate that background check, that verification, on their own because they are looking for a new job. 

Where it can get frustrating for potential candidate is the payroll login page. So if you’re not on the right device, I don’t know about you, but sometimes I don’t know my passwords. And I don’t know where I’m supposed to go or the website or my username or anything like that. And so I can foresee a scenario where candidates don’t have their passwords and ultimately fail to validate their employment through a platform like Argyle even though it’s in their own hands, simply because they don’t have the information at hand. That being said, if it was me and I was looking for a new job, I would make it my business to figure it out. Because the alternative would be to call my current employer, and that is not what I would be interested in doing.

Justin Stolzenberg, Argyle: I think one of the things that Checkr specifically does so well in the implementation of Argyle’s product is educating the applicant prior to actually showing them that payroll login screen. So giving the candidate an incentive and educating them: why are you connecting this account? Your current employer is not going to be notified, this verification is going to be done much quicker than it otherwise would have. And it’s actually less work than for you to input a bunch of data and documents yourself — so that candidate optionality and candidate education piece is really important in the experience.

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