The secret behind background checks in India—and why they fail

Quartz india
Quartz india

The Uber rape case in New Delhi has revealed the murky underbelly of slapdash background checks in India.

Uber is not alone. In a growing economy like India, companies are often seen in a mad rush to hire in the hundreds. Tight timelines for hiring and cost-consciousness often tempt recruiters to go easy on checks and verification.

And it is not hard to get fake documents in the country. There are close to 7500 companies in India, which operate just for providing fake employment and educational certificates, according to a report by First Advantage, a background screening company.

The company discovered this startling number during the process of education verification on prospective hires that it conducted for its clients. Among the discrepancies found in the second quarter of 2014, anomalies related to employment, address and education antecedents were at 60.4%, 15.9% and 6.0% respectively.

Who does these checks in India?

In India, the prevalent norm is for human resources (HR) to conduct a reference check from past employment based on the information provided by a candidate. The authentication of residential addresses, educational and criminal records is typically outsourced to third party background verification companies.

These agencies usually take between seven and 10 days to give a report and charge between Rs2,000 and Rs3,000 per candidate. The fee goes up in case of extensive checks and for senior level hires.

Despite the growth in the number of screening agencies, most companies are yet to give pre-employment background checks the importance it deserves.

“About 90% of organized sector undertake some form of checks while 95% companies in the unorganized sector are still hiring without any background check,” said Alka Dhingra, regional manager – IT at recruitment firm Teamlease Services.

Learn from IT firms

Executives involved in background checks say IT and ITES, banking and financial services and FMCG sectors are way ahead of their peers in sectors such as telecommunications, manufacturing, retail, hospitality, healthcare, travel, education and entertainment.

“We consider this as an investment as background checks help in safeguarding organizational assets, promoting safety at workplace, reducing turnover owing to right hiring, safeguarding company reputation, avoiding legal action and inspiring confidence in customers and shareholders,” said Gajendra Chandel, chief human resource officer at Tata Motors.

IT companies such as Tata Consultancy Services, Infosys Technologies and Wipro are known to show zero-tolerance towards corporate fraud and fraudulent employees. Punitive actions include termination of services and blacklisting such candidates and recruiters.

In fact, the industry body for technology companies, National Association of Software and Services Companies, maintains a centralized database of IT and ITES employees and third-party verified information on education, experience history and personal details of these professionals.

“Job portals such as Naukri, Monster and communities such as CiteHR forums also alert users of blacklisted candidates,” said Dhingra. “But this is not enough for carrying out checks. There is no single platform for non-IT/ITES companies where details of fraudulent candidates and recruiters can be found.”

Also, what makes the process of background verification difficult and cumbersome is the lack of a centralised repository of information, defined processes and procedures to conduct checks at educational institutes, police stations or courts.

But with newer forms of white collar crimes emerging, perhaps it is time that companies go the extra mile and conduct thorough background checks on prospective employees. Better to be safe, than sorry.

We welcome your comments at ideas@qz.com.

Also read: This is how your Uber driver is recruited and trained in New Delhi

Why it is almost impossible to ban Uber and Ola in India

Read the fine print—India’s app-based taxi services aren’t responsible for your safety

Delhi’s government just found out what Uber is—then banned it

home our picks popular latest obsessions search