Note: This is a contributed post from Patrick Hogan, the CEO of Handle.com, where they build software that helps contractors, subcontractors, and material suppliers with late payments.
The construction industry is currently experiencing a skilled labor shortage, and its ramifications are felt by contractors each day. As the demand for more construction work is driven by people flocking to cities around the world, builders are finding it hard to keep up. According to the McKinsey Global Institute, construction productivity has dropped by half since the 1960s.
Different factors contribute to this growing issue but one of the biggest reasons is the lack of employees working in crucial positions. And with baby boomers, who have been a huge part of the construction workforce, at retirement age, construction businesses need to find ways to fill the vacancies and soon.
The first step in addressing the industry’s labor shortage is to take a look at your current hiring practices. It is crucial that businesses offer competitive wages, bonuses, overtime pay, and retention rewards in order to attract fresh talent. However, this is not enough. There is still a lot of work to do in changing people’s perception of the industry from one offering dirty and stressful jobs to one that is worth building a career in.
That said, it can be tempting for construction businesses to hire anyone who sends an application just to fill a job. But this a huge mistake, sometimes even fatal to a company’s operations. In order to protect themselves from potential risks, business owners need to require a background check before hiring a candidate. Just as you would vet potential clients by checking notices and liens filed against them, it is equally as crucial to check candidate’s backgrounds to prevent any problems in the long run. While you should assume good faith on the part of a candidate, you still need to be proactive in ensuring what they say in their resume is true.
What Is a Background Check?
A background check is a process conducted by an organization to verify whether a person, usually a potential employee, is who they claim to be. Background checks usually involve checking a person’s education and employment history, possible criminal record, and medical history. Running a background check on potential hires requires their full name, date of birth, social security number, address, and their consent to run the check.
Importance of Background Checks for Construction Employment
Background checks are crucial for sound hiring decisions. However, they require significant time and financial investments. And with the construction industry’s payment issues and tight project deadlines, conducting background checks may seem like a tedious task. If you are still on the fence about this, here are some of the reasons why background checks are important in the construction industry.
1. Background checks highlight a candidate’s possible criminal history.
In general, background checks are used to flag any criminal incident that involves a potential hire. This can be considered a preemptive measure that will ensure the safety of the organization and determine whether the candidate is appropriate for the job.
For instance, an individual with a history of violent crime may not be suitable for a construction security position. Someone who has issues with substance abuse should not be allowed to handle heavy equipment or else they will be a danger to themselves and to others. A person applying to be a driver may not be the best for the job if they have a previous driving-under-influence case. These types of information can only be found through a background check.
2. Background checks ensure workplace safety.
In the construction industry, safety is always the number one priority. The construction site can be a dangerous place to be in. That is why all construction businesses invest in several safety checks and mechanisms to ensure that the employees’ working environment is well protected.
However, the skills and training of an employee are important aspects of workplace safety too. Site employees need to have the necessary experience and knowledge to be able to handle construction equipment safely. These can only be verified by conducting a sufficient background check.
3. Background checks ensure the safety of other employees.
There is a chance that some of the applicants that you will interview for a construction job are downright dangerous. Violent criminals and registered sex offenders may try to send their application for construction work, and you simply cannot risk hiring them and endangering your site employees. If you do not conduct a background check and end up hiring a sexual predator who then assaults one of your other employees or clients, you can be held liable for negligence. For this reason, always run a background check to protect your customers and workers.
4. Background checks verify an applicant’s educational merits.
It goes without saying that an applicant’s educational background is an important factor in your hiring decision. Many jobs in the construction industry are highly specialized and you need to ensure that candidates actually have the degrees and certifications that they claim they have. For instance, a project manager needs to have a business administration or equivalent degree so you have peace of mind in letting them handle their duties.
Aside from job qualifications, conducting an educational background check also ensures work compliance. Many construction jobs require employees to have specific degrees and certifications before they can be legally allowed to work. If a building fails due to structural flaws caused by an employee’s incompetence, you may be held liable for negligence if you did not conduct a background check.
5. Background checks highlight an applicant’s employment history
Educational history is not the only thing you need to verify about an applicant. Their employment history is another crucial piece of information that you should consider in your hiring decision. You need to know the experience of your fellow employers with the applicant in question and verify whether what they put in their resume—like job responsibilities and employment periods—are indeed true. If a piece of information that you verified with a previous employer does not match what is mentioned in a potential hire’s application form, you’ll need to bring it up with the applicant.
6. Background checks discourage dishonest candidates.
The hiring process can take a long time, from screening application forms through doing interviews until the signing of a contract. For the construction industry that needs to fill jobs as soon as possible, construction business owners need to streamline the hiring process to be able to bid on more contracts and stay competitive. Along with publishing specific roles and responsibilities on listings, hiring managers should state that they will conduct background checks. This will deter dishonest candidates from applying and allow them to meet qualified job candidates sooner.
7. Background checks eliminate uncertainty from the hiring process.
At the end of the day, you will always want peace of mind knowing that you made the right hiring decision. There can be a lot of uncertainty in the hiring process and job candidates are practically strangers. If you want your company to thrive, especially in the competitive construction industry, conducting a background check will ensure that you hire the best candidates.
Background checks are an essential part of the hiring process. It is an important step that enables you to determine qualified candidates for your job vacancies. Conducting a background check may take a significant chunk of your time, and there’s also the stress in doing the legwork in checking possible criminal records, employment history, educational background, and banking information. However, it is important to err on the side of caution and eliminate the risk of having a bad hire.
About the Author:
Patrick Hogan is the CEO of Handle.com, where they build software that helps contractors, subcontractors, and material suppliers with late payments. Handle.com also provides funding for construction businesses in the form of invoice factoring, material supply trade credit, and mechanics lien purchasing.