January 22, 2010 Background Checking: Conducting Reference Background Checks

Background Checking | ©SHRM 2010 Conducting Reference Background Checks 2

Background Checking | ©SHRM 2010 Reference Background Checks For the purpose of this research, the phrase “Reference background checks” refers to any verification of information provided by a job applicant (e.g., employment history), or communication with people regarding the job applicant (e.g., former supervisor or co-worker). It does not include credit and criminal background checks. 3

Background Checking | ©SHRM 2010 Does your organization, or an agency hired by your organization, conduct reference background checks for any job candidates? 4 Note: n=433. Respondents who responded “Not sure” were excluded from the analysis.

Background Checking | ©SHRM 2010 Which category of job candidates does your organization conduct reference background checks on? 5 Note: (n = 86).The data in this figure represent organizations that conduct reference background checks on select job candidates. Percentages do not total to 100% as respondents were allowed multiple choices.

Background Checking | ©SHRM 2010 In general, how frequently does your organization, or an agency hired by your organization, conduct any of the following reference background checks for its job candidates? 6 Note: n= Respondents who responded “Not applicable” were excluded from the analysis.

Background Checking | ©SHRM 2010 In general, how frequently does your organization, or an agency hired by your organization, conduct any of the following reference background checks for its job candidates? Nonprofit organizations conduct verifications of the following more than other sectors. Verification of schools, colleges and/or universities attended : NP (65%) > Privately (PFP) (36%) Verification of degree(s) conferred : NP (66%) > Privately (PFP) (40%) Verification of certifications, licenses, etc. : NP (74%) > Publicly (FP) (32%), Privately (PFP) (23%) Verification of schools, colleges and/or universities attended: Large (50%) > Medium (34%) Verification of degree(s) conferred: Large (54%) > Small (36%) Driving record check: Medium (40%) > Large (22%) Verification of certifications, licenses, etc.: Large (41%) > Medium (26%) 7 Comparison by Organizational Sector Note: Comparison by organizations’ sector, staff size and scope of business represent those who answered that their organizations “always” conduct reference background checks. Privately owned for-profit organization = Private (PFP) Publicly owned for-profit organization = Publicly (FP) Nonprofit organization = NP Government sector = Govt Small = 1-99 employees Medium = employees Large = 500 or more employees Comparison by Organizational Staff Size Verification of certifications, licenses, etc.: Primarily state based (58%) > Primarily nationally based (33%) Comparison by Scope of Organization's Business

Background Checking | ©SHRM 2010 In general, how frequently does your organization, or an agency hired by your organization, conduct any of the following reference background checks for its job candidates? (n = ) 2004 (n = ) Verification of former employers 81%66% Verification of dates of previous employment 76%66% Verification of former job titles 66%53% Verification of degree(s) conferred 49%35% Verification of schools, colleges, and/or universities attended 45%34% Verification of former job responsibilities 41%37% Verification of certifications, licenses, etc. 37%41% Driving record check 27%30% Check for malpractice or professional disciplinary action 25%22% Verification of past salaries 24%19% Government agency record search 17%-- Military discharge information 17%-- Verification of articles published, speaking engagements 2% Note: Table represent those who answered that their organizations “always” conduct reference background checks. Where possible, 2009 data are compared with 2004; a dash (--) indicates that this particular option was not asked in Compared With 2004

Background Checking | ©SHRM 2010 How often do you discover information that is inaccurate compared to what job candidates presented during the interview process when conducting reference background checks on job candidates regarding: 9 Note: n= Respondents who responded “Not applicable” were excluded from the analysis.

Background Checking | ©SHRM 2010 In general, after conducting reference background checks, if inaccuracies/misrepresentations were discovered compared to what the job candidate presented during the interview process what types of information are MOST likely to impact your decision to NOT extend a job offer? 10 Note: n=185. Respondents were allowed to select their top three options.

Background Checking | ©SHRM 2010 Does your organization allow job candidates, in certain circumstances, the opportunity to explain the results of their reference background check that might have an adverse effect on an employment decision? 11 Note: n=371

Background Checking | ©SHRM 2010 What are the primary reasons that your organization conducts reference background checks on job candidates? 12 Note: n=369. Respondents were allowed to select their top two reasons.

Background Checking | ©SHRM 2010 Demographics: Organization Industry Industry Health care, social assistance (e.g., nursing homes, EAP providers)18% Services—professional, scientific, technical, legal, engineering12% Manufacturing—other11% Educational services/education8% Government/public administration—federal, state/local, tribal5% Financial services (e.g., banking)5% Transportation, warehousing (e.g., distribution)5% Insurance5% Retail/wholesale trade4% Construction, mining, oil and gas3% Other services (e.g., nonprofit, church/religious organizations)3% High-tech3% 13 Note: n=312. Percentages may not total 100% due to rounding.

Background Checking | ©SHRM 2010 Demographics: Organization Industry (continued) Industry Telecommunications3% Utilities3% Services—accommodation, food and drinking places2% Publishing, broadcasting, other media2% Arts, entertainment, recreation2% Consulting1% Manufacturing—auto/auto-related1% Real estate, rental, leasing1% Association—professional/trade1% Pharmaceutical1% Other1% 14 Note: n=312. Percentages may not total 100% due to rounding.

Background Checking | ©SHRM 2010 Demographics: Organization Sector 15 Note: n = 319. Percentages may not total 100% due to rounding

Background Checking | ©SHRM 2010 Demographics: Organization Staff Size 16 Note: n = 312. Percentages may not total 100% due to rounding

Background Checking | ©SHRM 2010 Demographics: Organization Region 17 Note: n = 312. Percentages may not total 100% due to rounding

Background Checking | ©SHRM 2010 Demographics: Organization Operations Location 18 Note: n = 315. Percentages may not total 100% due to rounding

Background Checking | ©SHRM 2010 Background Checking Response rate = 19% Sample comprised of 433 randomly selected HR professionals from SHRM’s membership Margin of error is +/- 5 Survey fielded November 18 – December 4, Methodology