'Tis The Season For Protecting Retailers With Pre-Employment Screening Solutions

A race to hire

As the holiday season is here, retailers across the country gear up for the busiest time of the year. The National Retail Federation (NRF) expects retail sales to grow between 2.5% and 3.5% (between $5.23 and $5.28 trillion). While online shopping is expected to increase, brick-and-mortar stores remain consumers' primary point of purchase, accounting for about 70% of total retail sales. That means that as stores brace for the influx of shoppers, hiring managers scramble to bring in temporary workers to meet demand. 

Retailers are forecasted to hire between 400,000 to 500,000 seasonal workers to keep up with increased consumer activity this holiday season. But how can HR be sure they're hiring trustworthy and loyal people to get them through the busy period? A bad hire can be a costly mistake, so while hiring temporary employees is essential to meet the rush, retailers face significant risks if they compromise the quality of their workforce.

The industry rule of thumb is that employee turnover costs about 30% of an annual salary. For retail workers, with an average wage of $36,690, this means turnover costs can range from around $1,800 to $5,500 for businesses hiring seasonal workers who typically work between 2 to 6 months. This includes recruitment, training, and onboarding expenses, which are wasted when an employee underperforms or quits soon after starting. This would be incredibly debilitating for small retailers. 

There may also be severance payments, legal fees, and potential litigation if the termination process is improperly handled. With the stakes so high, comprehensive background screening becomes a critical tool for retailers looking to protect their business. 

The Risks of Seasonal Hiring

Seasonal hiring is different from regular hiring. The time crunch, the high volume of applicants, and the need for quick onboarding create unique challenges for HR teams in the retail sector. While many of these employees will only be with the company for a few months, the potential risks they pose are not any less serious.

Retail environments are particularly susceptible to theft and fraud; without proper screening, companies open themselves up to significant losses. Internal theft is a $50 billion problem, which can be attributed to retail employees, especially those working seasonally. Rushed hiring practices during peak season can lead to employing individuals who take advantage of the busy environment through fraud or simply being unqualified for the role. A thorough background screening process is essential to mitigate these risks. 

Why Comprehensive Screening Matters

Retailers can protect themselves from potential fraud, identity theft, and criminal activity by ensuring that every candidate has been properly vetted. Comprehensive screening solutions offer a multi-layered approach to identifying red flags before a hire is made.

At the core of these solutions is the ability to verify a candidate's identity and background quickly and accurately. Whether it's criminal background checks, employment history verifications, or drug testing, each layer of the screening process adds a layer of protection for the retailer. 

Essential Types of Screening for Retailers

For retailers, several types of checks are essential to be sure that the seasonal workforce they bring on board is reliable, trustworthy, and qualified. For example, retailers need to know whether a potential hire has a criminal history that could pose a risk to the business. Criminal background checks help identify individuals with a history of theft, fraud, or violent behavior, ensuring these risks are mitigated before entering a retail environment.

Drug testing is another vital part of the applicant screening process. During the holiday rush, employees are often under more pressure to perform quickly, efficiently, and safely. Drug testing helps identify candidates who may pose a safety risk to themselves or others in the workplace. 

Then, there's the essential need for employment history verification. While the threat of identity theft and nefarious activities like fraudulent returns tend to come from the consumer side, retailers may also inadvertently hire someone who isn't exactly who they claim to be. With 36% of applicants openly admitting they lie on their resumes, having a background screening process that includes employment and education history is a must. 

Verifying a candidate's employment history ensures they have the skills and experience necessary for the job. During the busy holiday season, hiring someone who isn't qualified can slow down operations, frustrate customers, and lead to a loss in sales. Employment history verifications help confirm that the candidates have the retail or customer service experience required to handle the fast-paced environment.

The screening process shouldn't stop when an employee is hired. By conducting thorough pre- and post-employment screenings, employers can safeguard sensitive information, maintain regulatory compliance, and build a strong reputation for transparency and trust. Continuous monitoring allows for proactive risk management, enabling employers to address potential issues early on and prevent larger problems from developing.

A Race to Hire: The Importance of Speed and Accuracy in Screening

The holiday season is a critical time for retailers, and having the right workforce in place can make all the difference in ensuring a successful and profitable season. While comprehensive screening is essential, retailers must also be able to make quick and safe decisions. 

	RJ Frasca is VP of Channels & Partnerships at Shield Screening.
	Lori Nicholas is Director of Sales and Partnerships at Cadient.