More and more people in the USA are taking on part time jobs that classify them as a freelancer or independent contractor. A role that is different than a full-time employee. Because of this difference the laws surrounding employment screening are not the same. As more people want to be their own boss and with companies finding it more expensive to hire full-time employees and rising health care costs the Gig economy has become a huge phenomenon filled with short term deals, freelance work and the opportunity to create your own work hours.
The gig economy has become a significant avenue toward employment for a large part of the overall nationwide economy. But what is the gig economy and how do background screening policies affect those employed individuals?
The Gig Economy is defined by Wikipedia as a labor market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs. The gig economy as labelled is a relative new phenomenon in the economy insomuch that so many companies work under this business model.
From the Guardian (Dec. 06, 18):
The “gig” economy was supposed to be an opportunity for entrepreneurs to be their own boss. Everyone from Uber to Postmates, Lyft, Airbnb, Turo and Parklee have all sold themselves as platforms for freelancers and would-be entrepreneurs to work for themselves. theguardian.com/business/2018/dec/06/is-the-gig-economy-what-it-has-been-cracked-up-to-be
Background screening in the gig economy remains a critical concern, just as it would for traditional employment. Even though these workers are basically self-employed as contractors they still interact with the companies customers and a bad experience between a freelancer and a customer could severely damage the company.
There is a legal difference between someone being an employee and someone being an independent contractor. Many of the platforms used in the gig economy such as Uber, Lyft, and Postmates may push for the label of independent contractor as the laws governing that title can be less stringent than “employee”. Nonetheless, background screening remains a critical tool in risk mitigation within these types of enterprises.
In the gig economy criminal history records are sometimes used as part of a complete background check but the rules governing this use is not well defined and, subsequently, results can be confusing for employers and can even lead to lawsuits.
Background checks are all about risk mitigation, and criminal history is an important part of that mitigation. In fact one might call the use of criminal histories integral because in some cases a person’s history can be predictive of future behavior.
From Slate.com (Dec. 07, 18) discussing criminal records:
But not all criminal background records are equal, and not all criminal records are predictive of future dangerous behavior. What’s more, because gig-economy platforms like to classify their workers as independent contractors, would-be and current workers aren’t usually granted the same legal protections against discrimination as applicants or hires classified as employees. So there’s a difference between those looking to work at a grocery store or office building versus those looking to work for TaskRabbit or Amazon Flex. Given that many gig workers shift across multiple platforms, it can also be hard to discern what might be disqualifying on one platform and what isn’t on another. And just as workers with criminal records deserve to understand how past convictions might affect their opportunities, customers who use gig platforms deserve to understand how these companies decide who will greet you on the other side of an app request. slate.com/technology/2018/12/uber-lyft-criminal-background-checks-gig-economy.html
Until laws governing background screening become employment specific to the gig economy, business owners should stay current with existing laws. As the manner in which people find employment changes, the laws will eventually catch up, and hiring managers should stay fully compliant with potential and existing law by working with a third-party pre-employment background screening agency.
In the end the utilization of background checks is all about risk mitigation, and criminal history is an important part of that mitigation. Criminal history information can be integral to the entrepreneur’s working part-time and even independently from their employer’s company that pays them because in some cases a criminal history report can be predictive of future behavior and although these independent contractors are not officially employees of the companies they work for they surely can be a huge risk to the company if something bad happens between them and a customer.
The safest approach for any company or organization in the USA that partakes in the Gig economy by hiring part-time/independent workers is too use a professional background screening agency to vet these individuals the same as they would their full-time employees.
To read more about the growing Gig Economy in the USA and what role background screening and particularly criminal background record checks will play given part-time/freelance or subcontracting is different than what a full time employee is read recent CriminalBackgroundRecords.com press release: Criminal Records and Background Checks in the Gig Economy