Is Your Background Screening a Brand Risk?

Welcome to Know Your People from First Advantage, a show about trust in a changing world.

The rules, the technology, the way people work, what customers expect, all moving at once. Trust has to keep pace, and it’s two way. Organizations trusting the worker, the worker trusting organizations, and consumers trusting the provider, and it’s always changing. Trust is established on the first job and reearned on every job after.

This isn’t a show that hands you answers. We sit down with the people who live it, trust and safety leaders, those working in regulation, and the experts chasing fraud. The honest version, not the easy one. Let’s get into it.

Hello, everyone. I’m Maureen Lally, and I’m the chief marketing officer for First Advantage. Most conversations about the gig economy happen with people looking at it from one side, either from the inside of a platform trying to grow it or from the outside trying to regulate it or supply it. Today, I’m excited to have a conversation with someone who’s done both, my colleague, Spencer Chi. Spencer spent years on the platform side of the gig economy, building and scaling the process by which workers are actually onboarded.

He now sits on the provider side at first advantage where the question stops being about how to move faster and starts being about how you actually know who you’re letting into your organization and what you do with that to help businesses build a trusted workforce.

For a long time, the background check was the main decision.

It was run once at the time of hiring and then forgotten.

That has now changed. Trust and safety has gone from a barely from barely an industry category before twenty twenty to an approximately fifteen billion dollar market.

Today, the two of us want to get into what that shift actually means from the platform side where Spencer helped build and now supports organizations with that from the brand side. And we’re here to watch that all play out. Spencer, you spent years on the platform side working on trust and safety teams and building and scaling the onboarding process for workers at a major US delivery platform.

Now you’re on the provider side. What does someone see from inside a platform that they can’t see from anywhere else?

Yeah, it’s a great question. I mean, we always like to see the person that shows up at our doorstep and with excitement, you know, you’re getting your food or you’re getting to that concert that you took a rideshare to. But what’s really going on inside is a constant battle of supply and demand. You’re always looking for how do we make sure that Chicago, Illinois has enough drivers to make sure that you can fulfill the needs of those folks out there. How do you make sure that when it’s snowing outside, that there’s enough people that can deliver soup to the the cold and the hungry out there. And so I think that that’s really the dynamics that people don’t necessarily get to see from the outside is is making that dance of supply and demand really seamless for folks.

So when you crossed over from running it to supplying it, what looked completely different from the other side of the table?

Yeah.

Just firsthand, the experience of what it takes to really generate a consumer report for someone. I mean, all of the coordination and efforts, how much work goes into just getting that final deliverable out to to end user and saying, I can make a decision off of this. There’s so much more behind the scenes that folks don’t understand as far as complexity that I didn’t know of when I first started at First Advantage.

So I always come from this from the brand and marketing perspective. So before we go further, where do the operator’s priorities and the brands priorities actually pull apart in your experience? Yeah.

This is this is an interesting piece because I actually think that they they historically have pulled apart, but they really align on the same area in that both parties are protecting the company’s reputational risk or or reputation as a whole. And, you know, operators are more concerned about the current state. You know, what’s going on today? How do I let this person onto the platform in this moment to keep growth high? But, you know, marketing is concerned about what is the long term growth and trust that we can build with our platform or reputation that we’re creating there. And so I actually think that their worlds do align in that largely they are trying to make sure that the platform can have a sustainable trajectory for reputation going forward. It’s just in different timescales.

When you were running a platform, what did you learn about a background check? What can a background check do and what can’t it do? And what can it actually tell you about a person?

Yeah. I I love this question because we automatically, when we hear background check, it it maybe sounds old fashioned or it’s or it’s very inundated. And and at the core of it, background checks are behavioral signal. So you are able to understand via a pattern of criminal history if someone is going to produce risk on your platform.

Are they gonna behave the same way they behaved in the past? And that might be reckless driving. It might be a violent history. And so all of that is useful signal as you decide, do you want to put this person in front of my elderly grandmother who just can’t, is not as mobile anymore and she needs groceries delivered to our home, right?

And so a lot of that is putting yourself in that perspective and then driving through the the basis for why a background check is important.

So having said that now, what did you believe about background screening when you were scaling that you since changed your mind about?

So I used to feel background checks were just checking a box. Right? We need to do it. It’s the compliant way to do it. Everyone else does it.

But now I really see the benefit in how customizable background checks can actually be in the grand scheme of things. And so that understanding and and getting behind the scenes and understanding what databases, search types you’re dealing with, you start to learn that it’s actually a lot more flexible than what you first imagined. And it’s not just checking a box, it’s being able to do something meaningful with it.

So Good.

Okay. Great. Now when you were on the platform side, what was the job actually optimized for?

Did you often seen times when screening was ranked against speed and cost?

You’re you’re getting to the to the harder questions here, Maureen. You know, the the speed and cost are always gonna be the paramount kind of tied for first priorities for these companies. You know, the platform is heavily indexed on making sure that you can get someone, you know, equipped, ready, and activated on a platform as quickly as possible and in the most cost effective way.

Screenings was there in more of a reactive sense where if something were to happen, the first area they would go to is, did we screen this person or how in-depth did we screen this person? And so I would argue that it wasn’t necessarily as prioritized as speed and cost.

Okay. Well, you have said that the customer’s first priority is almost always speed.

But given your experience, has that changed? And is there more at stake now?

So is the possibility of risk and the fraud that has changed how businesses prioritize the stages in the hiring process?

Yeah. It’s funny that we index on on speed here because as we think about speed as far as getting people onto a platform, we’re also seeing an acceleration of bad actor activity and even fraud on platforms. So I would actually say that risk is speeding up, which means that controls screenings, identity verification needs to match that speed. And I think that’s been proliferated by AI in the recent months that we’ve seen really the adoption go up.

Right. I I think everyone has experienced that now as well.

Right.

So cost is the pressure that people often underplay, including the unit economics of the last mile. How does cost quietly shape what types of screening a platform is even willing to do?

Yeah. Without going into too much detail here, cost is a factor of intent. And what I mean by that is I have already spent a significant amount of money on a single individual to make sure that they have equipment to do their job on the platform. Well, I’ve paid for a background check already and they’re kind of let loose to perform on the platform, but they haven’t generated any revenue yet. And so we’re spending a lot of upfront investment in making sure that people can meet the standards of our platform.

But we haven’t actually seen them work or show intent that they want to generate revenue on the platform. And so you’re actually trusting that they are are going to follow through with that and and that they would become profitable for you.

But at a people from from a person level or a personal level, it’s really important to understand intent looks different for every single person. I might have a day job and I just wanna perform food deliveries at night. And so that means that I don’t actually work in the app until later on. And so these follow on effects are constantly studied within these platforms to make sure that you time your applicant onboarding process correctly to meet that demand and that timeline.

So Great.

No. That was very helpful. So what is a pressure that’s on the gig marketplace now today that basically didn’t even exist five years ago?

Yeah. There I I would actually point to a couple of things, but the first one being synthetic identity fraud is a huge pressure in gig.

And essentially, it’s very, very easy to get away with a falsified ID or even document these days to be able to go beyond the traditional screening methods. And so that was not something that we were confident was a risk that we had to mitigate five years ago. It was something where we were looking at it and saying it’s not advanced enough to really beat our controls.

So we do need to evolve to meet those new standards.

Great.

And it’s gonna continue to evolve even for another five years from now and ten years from now. Right? Exactly. See how that works.

Okay. So now walk us through how you actually think about the recruiting and hiring process. If the background check is one layer, what are the other layers?

Yeah.

The stack, as I like to call it, is really the basis of saying background checks are are one risk assessment opportunity. Identity verification actually sits above background checks or before it in the sequence in that they solve two different issues. You have who is this person that’s gonna be on my platform? And the second one is how risky is that person gonna be? The next layer then becomes what other risk signals am I pulling? The device that someone’s gonna be using, the vehicle that they’re operating, those contribute to how risky this person will be on my platform.

And then it becomes a continuous or a user life cycle management process where you’re constantly assessing that risk. And that’s a monitoring layer that at First Advantage, we’ve really honed. And the last piece is gonna be the reactive method. So you can’t catch everything. And so in order to have a true trust stack, you need to have something that’s able to flexibly or adapt adapt to the the existing kind of controls and and meet the needs of safety incidents that occur on any given notice.

So Yep.

Okay. So you’ve made the point that gig doesn’t necessarily make binary hire, no hire calls the same way that staffing does. You don’t have to reject someone. You can place them.

What does designing for placement instead of a yes, no change about the whole system?

Yeah. There there’s an entire spectrum here and and we we definitely wanna save some time for more topics. But what comes to mind initially is the ability to allow a driver to perform certain responsibilities based on their score essentially or how you would risk rate their risk on the platform. And so, you know, an example is maybe someone has a poor driving history, but they don’t have any criminal charges. And so I wouldn’t necessarily trust them in a car, but we have non driving positions or non driving shifts that we could essentially route this person to or activate them on.

And that gives the opportunity for equal employment and allows for someone to be placed into something that meets the standards while also mitigating risk in that context.

Right.

So where does identity sit in all of this? Is it just another check or is it the filter that decides who even gets assessed?

We are seeing identity continue to be a cornerstone of the larger kind of trust infrastructure. And what I mean by that is you could have the squeakiest, cleanest record out there on any platform. But if the person who is actually applying for it is using falsified documentation and is not verified from an identity perspective. All of that goes away. And so I really think that identity is a critical component of being able to first say, is this person who they say they are? And is this person the the one that’s going to show up in front of in front of me at the end of the day?

And can we tie that background checker, that screening back to that person as a result of verifying their identity? And I think those two things need to play hand in hand consistently.

Right. So you’re talking about all these data points. Right? If everyone can collect more signals now, the hard part becomes turning them into decisions.

Who’s genuinely good at the orchestration today and who just has more data?

Are are you asking me to give you a platform name or are we talking general?

You can decide whatever you’d like. Platform name, specifics. Who’s who’s good at this orchestration right now? But who’s just kind of collecting more data and not necessarily making sure that this process insufficient?

I mean, the answer that comes immediately to mind is Uber. They have been in this industry for the longest and they have collected data over several years. They’ve they’re on many different, you know, global market areas. And I think what they do really well is they turn the granular data points into really critical insights. You know, anything as simple as how quickly is the vehicle moving between, you know, x point a and point b is a critical data point as far as are you gonna get your food on time? And so I think they turn a lot of those data pieces and they have a lot of information into really critical insights that benefit the end user on their platform.

Great. Okay.

So you’ve made a sharp point internally that a provider’s real strength Appreciate it.

Often only show up after you’ve signed. They’re not like the front door reputationally flashy differentiator.

On the platform side, how much did front door reputation actually drive the decision versus what you’d only discover later after the fact?

You you may be surprised to to know that the the front door reputation is the the brand showing up in in front of you.

We found through a lot of of research early on that if you’ve had a bad first experience on our platform that you wouldn’t necessarily go back or you choose an alternative, right? So first impressions are everything, as you know, from from your side on the marketing perspective. And so the discover later type of approach was really only in postmortems or poor customer feedback and support cases. You know, my fries were cold. Let’s investigate what’s going on with that.

Great. What are some anecdotal cases where the reputational risk or brand damage has been too high?

Yeah. These are these are always tough to to speak on because there’s some real people behind the scenes here. But, you know, I recall a situation where an individual was delivering and they happened to have a young child in the backseat of their car and what happened is there’s an individual who attempted to steal the vehicle and they essentially were charged with kidnapping due to the fact that this person’s child was was in the vehicle. And so that’s just one example of the real world stakes that these teams deal with, especially in trust and safety, where the reputational risk alone is first off recovery. How do you stop the blatant? How do you make sure that everyone is okay?

But also how do you make sure that you enable protections to block that from happening going forward? And so that was a situation where you really had to do a lot of brand reputation management to get back to a a good place with and a good standing with the public.

Agreed. Okay. So nearly everything else we’ve discussed can be measured. Reputational reputations overall just can’t or it’s really hard to. How do you see brand risk getting weighed against speed?

Yeah.

You know, the the brand risk is actually more important to these platforms than I I would consider in in the speed conversation or comparison.

We we see that reputation is incredibly difficult to build back up once you’ve kind of seen a decline.

And especially when you have a handful of pretty damaging incidents that are caused on platforms, it’s hard to really get back from that. So you really only have, you know, one opportunity to make sure your brand is is protected versus speed can always be kind of toggled up or down over time.

Great.

What’s the honest reason a qualitative risk loses the budget fight to a quantitative one? And how should that change or shouldn’t it?

This is a this is one that’s near and dear to my heart. There are a lot of use cases where the data beats out, an individual use case sometimes. And where I think this is coming from is there’s not a tangible return on investment that you can put into a spreadsheet that you can sell to your investors and your board that ties back to qualitative risk. Quantitative components will always have some sort of cost associated with them. But if you have a picture of an individual who, you know, unfortunately may have lost their life on a platform, you can’t ask me to quantify someone’s life. It’s important to understand that that risk is just as important as millions of dollars on a spreadsheet. And so rewriting that argument, it’s it’s really a quality conversation of making sure that you’re making the decisions that are responsible for real world lives and humans on on at the end of the day.

Great. Very well said.

Okay. When a platform ends up in the headlines over a single bad actor, Is that a screening failure, a brand failure, or a leadership one?

Oh, gosh. Can I take all of the above?

Yeah. That’s one question. Yeah.

You know, the it’s interesting because there’s a component or there part of me wants to say that sometimes headlines sensationalize some of the the incidents that occur. But I would argue that it’s every aspect of a screening brand or leadership accountability when a platform ends up in in the headlines. Right? Everyone plays a part in the grand scheme of things.

And so it’s important to recognize that when we think about, you know, a bad circumstance or something that happens on a platform and and the reason why it’s elevated in the news is to create motion or to create progress. And the goal is to be able to generate a better experience for folks going forward. It’s a cautionary tale that teaches people the right way to to behave in certain scenarios. And so I’d like to think that it’s purposeful in creating lessons for other platforms to be able to to drive that and and everyone is responsible from leadership down to the operations folks.

So for a listener who runs or builds in gig, what’s the one thing a platform can do early that changes the impact of their reputation and ability to grow their business?

Yeah. Set a foundation.

Your most important work is to start. And it might be building a very, very minimal risk assessment process, but it’s way harder to start from scratch when you’re scaling and you’re growing significantly than to set some controls up at day one and then just build on it over time as your platform scales.

Right. So now, Spencer, what do you wish you would have known before joining a solution provider?

Yeah.

I touched on it a little bit at the beginning, but I wish I had a greater appreciation for how much work, effort, coordination, orchestration it takes to actually produce a consumer report. A single report has so many different steps and components to it. So that complexity is really important. I think the other piece to add is doing it at scale is incredibly difficult. It’s not just being able to surface one consumer report, but doing it several areas within a business is is really a huge undertaking.

Right. And it’s gonna continue to get more complex, not just here in the United States, but in other regions as well.

And, of course, different industries.

Okay. So three years from now, what will we be glad that you started saying out loud now?

Yeah. The the takeaway here is that we want to continue to think about trust and safety not just as a risk or mitigation lever, but more as a growth perspective. And and what I mean by that is when you are thinking about creating better outcomes on the platform, you’re actually allowing for higher quality users to to kind of onboard. You’re you’re creating room and space for, you know, folks that want to work that are really, really good for your platform that drive that reputation well. So I I actually think that that narrative is is really important to say that trust and safety is not just, you know, we deal with the bad stuff, but it’s really creating room to benefit or drive your platform’s quality.

Great. Spencer, these were amazing thoughts and comments that you’ve provided to us. Are there any additional thoughts that you’d like to leave the listeners with today?

Yeah. It’s I would argue that this is a very complex world that we’re playing in. Always changing. There’s an evolution of risk that’s happening every single day.

So lean on the folks, the networks, the solution providers out there to help drive some of these conversations. And I would just say get exposed to different types of risks and opportunities so that you can battle some of the more complex stuff out there.

Great. Thank you.

So for a long time, the background check was the decision. What Spencer and I keep circling back to is that it’s become one layer within something wider.

It is proactive as well as reactive and continuous rather than a one time check.

It’s about placing people well, not just keeping them out.

None of this is easily settled, and neither of us pretends that it is. If there is one thing to take away from today, it’s that knowing who is working for you is never a single moment at the front door. It’s something you have to keep earning because trust is earned and has to be maintained. It is not one and done.

That’s it for this episode of Know Your People. Everything we covered is in the show notes. Follow wherever you’re listening so the next episode finds you. Know Your People from First Advantage. Trust in a changing world.