Employment Verifications: Top 3 Challenges During Pandemic

New ways to manage employment verifications

Employment verification requests, intended to verify an individual’s current or past work status, are a normal part of many business, financial and legal processes. Employers may receive them regarding current employees, who are trying to secure a loan or regarding past employees, who are being recruited for new jobs. Applying for social welfare, such as unemployment benefits will also trigger employment verification requests, and in the near future, there may be an influx of vaccine-related employment verifications as well. 
 

Most HR professionals are well accustomed to receiving verification requests. But just like every other business operation, the process of fulfilling those requests has been impacted by the global pandemic of Covid-19. Human resources departments, already dealing with a massive migration to remote work and numerous other pandemic-related challenges, also have to find a way to manage income and employment verifications in new ways. 

3 Verifications-related Challenges for HR Professionals

1. Changes in Credit Lending 

Over the last year, lenders have augmented their normal checks against borrowers to defend against what experts have deemed a period of “increased default risk.” Especially where mortgages are concerned, they want more employment verifications (multiple times in a single loan process for many lenders) and they want them faster. A number of high-profile lenders currently even require a closing-day verification—a big deal considering the additional tightening of restrictions on companies’ ability to fulfill requests verbally. 

This is all compounded by the fact that the pandemic led to a surprise housing boom, meaning the number of mortgage-related employment verification requests has been much higher than normal. 

2. Increase in Social Service Verification Requests

Temporary furloughs, reduced hours, and business closures have led to a large increase in the number of people applying for government assistance. Determining an applicant’s eligibility— including exactly what and how much they are eligible for—relies heavily on the employment verification process. 

Similar to the mortgage situation, the rise in social service requests is putting a strain on HR departments because of sheer volume. Crucially, businesses are legally obligated to respond to requests from federal agencies and are vulnerable to hundreds (and sometimes thousands) of dollars in fines for every request left unanswered. 

3. Incorrect Request Processes

As if dealing with the number of requests during such a hectic time isn’t enough of a challenge for HR professionals, they also have to worry about whether they’re even seeing all of those requests. A large percentage of HR workers have been forced to embrace remote work themselves, but many companies are finding that requests are still being physically mailed to their listed addresses, where they may go unseen or unopened for a significant amount of time. Depending on the business’s location and the Covid guidelines at that particular time, this is a problem that some HR departments simply can’t change. 

How Companies Are Handling the Problem

While businesses can be fined for failure to fulfill an employment verification request from a federal entity, most aren’t legally obligated to deal with requests from other third parties. Since many requests do originate in non-binding circumstances, and since there is no direct monetary benefit to fulfilling them, some companies have responded to the general Covid-related inundation by simply placing processes like income and employment verifications fulfillment on the back burner. 

Although the temptation to do so is understandable, not treating a verification request as a priority is the type of small mistake that can have big ramifications. Most requests are related to big decisions and life changes, whether it’s buying a home, getting a job, or receiving social assistance. Failing to recognize the importance of those situations can have a negative impact on the trust and respect that current, past and future employees have for the business or brand. 

Most companies do realize the importance of timely and accurate employment and income verifications and are adjusting as best as they can. Some are shoring up their HR departments, while others are outsourcing income and employment verifications completely—an answer that, for many, is the best way to ensure compliance and confidence. Regardless of the specifics, companies will do well to keep employment and income verification a priority and focus on finding a solution to these challenges that is consistent, secure, and supportive of the bottom line. 

Cassie McGee is a Sr. Manager of Customer Success at Experian Employer Services. She has several years of experience in the verification of employment industry, including an array of roles from service, solutions, to implementation and business development.  Cassie works closely with clients to proactively explore ways to help human resources and payroll departments efficiently implement processes to support verification volumes and alleviate any internal overflow.  Visit www.experianplc.com  Connect Cassie McGee