Background Checks - In-House vs Outsourced

Background Checks - In-House vs Outsourced

Key Differences between In-House and Outsourced Background Checks

If you are an employer or landlord performing background checks as part of your employment screening or tenant screening process, it is important to decide whether in-house or outsourced background checks are right for you.

To decide, we have to differentiate between in-house and outsourced background checks.

In-house background checks are when employers, landlords or realtors do background research on their own. An example is when an employer or hiring manger visits a county courthouse to search their databases for records using the applicant's name. Another example would be a landlord calling a tenant applicant's employer to verify employment and wage/salary.

Outsourced background checks are when employers, landlords or realtors enlist a third-part background check company to run the background checks on their behalf. Usually this third-party is a Consumer Reporting Agency (CRA) such as AAA Credit Screening Services or a reseller that purchases its background check reports from a CRA. Every company has its own process, but in the case of AAACSS, the employer, landlord, or realtor ("client") will send in a background check request with the applicant's signed authorization form specifying the type of background check that they would like, for instance a National Criminal Record Check, a Workers Compensation Report, etc. AAACSS will then run the reports and return the information to the client.

Pros and Cons for in-house and outsourcing background checks:

In-House Background Checks

Pros:

• Background checks do not have to conform with the FCRA - Fair Credit Reporting Act guidelines which means that they can go back further than the 7 years of history provided by CRAs.

• There are no service fees, except for those charged by individual courthouses, registrar's offices, etc.

Cons:

• There is a limit as to what the employer/landlord/realtor can find out on their own without the use of a CDA or reseller. They would have to visit county courthouses, police departments, and contact the applicant's references on the application themselves. Some counties may have records online, but many do not have online access or even phone access to criminal records.

• Running background checks is a time-consuming endeavor, especially for someone that does not have background screening industry resources. Just one applicant's background check can take hours to complete and for an HR employee whose industry annual salary averages $62,960, doing in-house background checks can be a waste of company time and resources.

Outsourced Background Checks

Pros:

• Background check companies such as AAA Credit Screening have a wide scope of search capabilities that individuals do not have access to. Background checks can be performed at the county, state and national level as well as foreign countries. This wide scope of searches in near-impossible for individuals to perform in-house. Background check companies also have the ability to perform social security number verification or run business credit reports, services not available to individuals.

• Employer/landlord/realtor resources spent is limited to the amount of time it takes to order the report and the cost or reports ordered from a background check company. Statewide criminal record reports can be ordered and delivered as soon as 1 business hour through a background check company versus weeks visiting court houses, paying access fees, etc.

Cons:

• It is important to order background checks from a reputable company. Using a background check company that is a member of PBSA - Professional Background Screening Association can help ensure that the CRA or reseller is reliable and follows industry standards and helps prevent low-quality, incomplete or falsified or even mistaken identity reports.

• Background check companies must confirm to the FCRA - Fair Credit Reporting Act guidelines. This means that the searches run by CRAs and resellers can only return the past 7 years of credit and criminal record history. It also requires that the CRAs or resellers must determine that the employer or landlord/realtor has a permissible purpose for running the reports. The FCRA also requires the applicant to authorize all checks before they are run.

AAA Credit Screening Services is not only a member with the NAPBS, but also an accredited business with the Better Business Bureau (BBB), and a partner of the Society for Human Resource Management (SHRM) and the National Association of Residential Property Managers (NARPM). AAA Credit Screening Services has a global reach for background checks, able to perform searches in many locations that other companies are not. AAA Credit Screening also stays up-to-date on tenant, credit, and employment background screening laws so that its clients can be protected from undesired litigation.