![\"hiring](\"https:\/\/primepay.com\/wp-content\/uploads\/hiring-red-flags-screenshot-1920x866.png\" "\\"\\"")
<\/a><\/figure>\n\n\n\nDownload our free Hiring Red Flags guide<\/a> to help spot issues and verify that you’re hiring the best people for the job.<\/em><\/p>\n\n\n\n As a small business owner, you may not have the luxury of an extensive HR department to handle hiring risks. Hiring risks aren\u2019t new but are, unfortunately, a growing issue. <\/p>\n\n\n\n One risk \u2013 employee theft \u2013 often takes the top spot of concerns. As of 2025, 75% of workers<\/a> admit to stealing from their employer at least once, costing businesses roughly $50 billion annually<\/a>. If that\u2019s not sobering enough, experts believe businesses lose $0.20 of every dollar<\/a> to employee theft. <\/p>\n\n\n\n These losses, combined with hiring and training costs, are money most small businesses can\u2019t afford. Luckily, conducting a thorough employer background check can help you:<\/p>\n\n\n\n However, background checks must be conducted legally and ethically. Before implementing them, it\u2019s essential to understand compliance requirements and best practices.<\/p>\n\n\n\n Background screening is governed by the Fair Credit Reporting Act<\/a> (FCRA) and various state regulations. To stay compliant, make sure you:<\/p>\n\n\n\n If you use an applicant tracking system<\/a> (ATS) to run background checks, you\u2019re already one step ahead of competitors. That\u2019s because you can integrate your recruitment, candidate profiles, pre-employment screening, and background checks in one place. The result? An organized, streamlined process for you and your candidates. <\/p>\n\n\n\n “Data-driven decisions separate thriving businesses from those struggling with turnover. An ATS that integrates background checks ensures small businesses aren\u2019t making hiring choices based on instinct alone but on verified information that safeguards their workforce and bottom line.” \u2014 Joshua Siler, CEO of HiringThing<\/a><\/p>\n\n\n\n Although background checks may seem straightforward, making errors (compliance or otherwise) can cause headaches and financial penalties. We\u2019ve therefore gathered seven strategies to ensure you save time and make informed hiring decisions to set your small business up for success. <\/p>\n\n\n\n The best time to run a background check is after you\u2019ve extended a conditional job offer. This timing helps prevent potential discrimination claims and ensures that all candidates are evaluated fairly.<\/p>\n\n\n\n Note that candidates should be aware employer background checks are a part of the hiring and preboarding process<\/a>. Don\u2019t be like one Cincinnati-based home healthcare small business, where, after rounds of interviews, their chosen candidate failed a drug test (and had a history of doing so!). The candidate’s response? \u201cIf I would\u2019ve known that was a requirement, I wouldn\u2019t have wasted time interviewing.\u201d <\/p>\n\n\n\n Many states have laws limiting how employers can use credit reports and criminal records in hiring decisions. Additionally, the “Ban the Box” movement restricts asking about criminal history early in the hiring process to help former inmates secure work. Be sure to research your state\u2019s specific laws before proceeding.<\/p>\n\n\n\n When conducting a small business background check, here are some key areas you may review:<\/p>\n\n\n\n If your hiring program<\/a> is transparent (and it should be), candidates should be in-the-know about their onboarding steps and, specifically, their background check process and results. <\/p>\n\n\n\n If the returned results of the background check influence your decision-making on the particular candidate, here are some quick steps of the proper way to let them know:<\/p>\n\n\n\n Properly storing background check records ensures compliance with federal and state laws. For applicants not hired, retain records for one to two years (depending on your business size and any applicable affirmative action laws).<\/p>\n\n\n\n For hired employees, keep background check records for six years after termination to protect against potential legal claims.<\/p>\n\n\n\n Make sure you store these records separately from employee personnel files to maintain confidentiality.<\/p>\n\n\n\n A well-executed small business background check can provide peace of mind when hiring new employees. However, following legal guidelines and ensuring fairness in your hiring process are essential. If you\u2019re unsure about compliance, consider consulting with an HR professional or your ATS provider\u2019s<\/a> support team to streamline the process.<\/p>\n\n\n\n By taking these steps, you can build a trustworthy workforce while protecting your business from potential risks. <\/p>\n","protected":false},"excerpt":{"rendered":" Hiring the right employees is crucial for any small business. Why? A single bad hire can lead to financial losses, decreased productivity, or even legal troubles. (Hopefully you haven\u2019t learned this lesson from experience.) Many small business owners therefore turn to employer background checks to ensure they make informed hiring decisions. The key, though, is […]<\/p>\n","protected":false},"author":13,"featured_media":9678,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","footnotes":""},"categories":[21],"tags":[],"class_list":["post-4427","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-human-resources"],"acf":[],"_links":{"self":[{"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/posts\/4427","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/comments?post=4427"}],"version-history":[{"count":3,"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/posts\/4427\/revisions"}],"predecessor-version":[{"id":9862,"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/posts\/4427\/revisions\/9862"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/media\/9678"}],"wp:attachment":[{"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/media?parent=4427"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/categories?post=4427"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/primepay.com\/wp-json\/wp\/v2\/tags?post=4427"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Why Small Business Background Checks Matter<\/h2>\n\n\n\n
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Compliance with Background Check Laws<\/h2>\n\n\n\n
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![\"ATS](\"https:\/\/primepay.com\/wp-content\/uploads\/ATS-background-check-product-shot.jpeg\" "\\"\\"")
<\/figure>\n\n\n\nBest Practices for Running a Background Check<\/h2>\n\n\n\n
1. Conduct Background Checks Post-Job Offer<\/h3>\n\n\n\n
2. Understand Legal Restrictions<\/h3>\n\n\n\n
3. Know What Information You Can Access<\/h3>\n\n\n\n
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4. Communicate with the Candidate<\/h3>\n\n\n\n
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5. Retain Background Check Records<\/h3>\n\n\n\n
Making the Right Hiring Decision<\/h2>\n\n\n\n