First Advantage Background Screening Trends Report: EMEA · First Advantage Background Screening Trends Report: EMEA January 2011 - June 2014 TRENDS REPORT INFORMATION YOU NEED. PEOPLE

First Advantage Background Screening Trends Report: EMEA

January 2011 - June 2014

TRENDS REPORT

INFORMATION YOU NEED. PEOPLE YOU CAN TRUST.

TRENDS REPORT

The changing landscape of verifications screening across Europe, the Middle East and Africa

2

TABLE OF CONTENTS

Dear Readers,

Hello and welcome to our report into

verifications screening in EMEA.

At First Advantage, we have seen how

background screening in EMEA has changed

markedly over the last three years. While

there is no shortage of anecdotal evidence

around these changes, we wanted to

investigate the data to see what it could tell

us. The key findings of that investigation are

summarised here in our first spotlight report

on verifications screening in EMEA.

This report highlights some of the key

findings and trends in verifications for our

region, including volumes of checks and

discrepancy rates over time and across

industries, for education, employment and

professional verifications.

We hope you find this report useful and

insightful. To discuss the results in more

detail or provide feedback for future reports,

please get in touch. Thank you.

Yours sincerely,

Traci Canning

Senior Vice President

& Managing Director, EMEA

3 Introduction

4 Discrepancy Rates

5 Discrepancy Rates by Type of Verification (Education and Academic Qualifications)

6 Discrepancy Rates by Type of Verification (Employment History)

7 Discrepancy Rates by Type of Verification (Professional Qualifications, Licences, and Membership)

8 Discrepancy Rates by Candidate Type (Permanent vs. Contingent Workers)

9 Discrepancy Rates by Candidate Type (Permanent vs. Contingent Workers by Type of Check)

10 Discrepancy Rates by Sector

11 Discrepancy Rates by Sector: Professional Services

12 Discrepancy Rates by Sector: Technology

13 Discrepancy Rates by Sector: Legal

14 Discrepancy Rates by Sector: Staffing and Recruitment

15 Discrepancy Rates by Sector: Financial Services

3BACKGROUND SCREENING TRENDS - EMEA

Key Findings

• Almost a third of verifications uncover discrepancies• Major discrepancies persist• Education history most likely to contain discrepancies• Discrepancy rate highest in professional services sector• Discrepancy rate significantly higher for contingent workers

Hello and welcome to our latest report into the changing landscape of verifications

screening in Europe, the Middle East and Africa.

In the period from January 2011 to December 2013, the volume of checks processed

rose by more than 25% as more employers appreciate the value of screening and

economic optimism has spread.

This growth has been generated by increased demand for both contingent and

permanent worker checks, reflecting a shift in human resource behaviour that

recognises the risks posed by all employees, whether recruited on a permanent or

contract basis.

Most Requested Checks

• Employment history• Identity verification• Credit check• Criminal record check• Education history• Professional qualifications• Other (e.g. adverse media and global watch lists)

Introduction

INTRODUCTION

Increase in volume

of checks processed

between January 2011

and December 2013

+25.1%


DISCREPANCY RATES

Average Discrepancy Rate

The prevalence of discrepancies in candidates’ education, employment and professional

histories indicates that the ‘culture of overstatement’ persists in EMEA.

The rate of major discrepancies – those which raise significant cause for concern – has

remained broadly flat (8.7% on average).

The rate of minor discrepancies – those which are considered less of a concern – has

seen a gradual decline. This reflects a change in behaviour we’ve been witnessing over

recent years, as clients adjust their screening policies to become less sensitive to, for

example, brief periods of unemployment and inaccuracies about a candidate’s former

job title/role. Employers are looking for ways to streamline the hiring process, focusing

on the ‘major’ discrepancies which matter most to their recruitment decisions.

Almost a third of all verifications

uncover discrepancies.

27.2%

Minor: 18.6% | Major: 8.7%


DISCREPANCY RATES BY TYPE OF VERIFICATION

Education and Academic Qualifications

2011 2012 2013 2014(Q1-2)

Overall 33.9% 37.8% 35.1% 32.4%

Minor 21.4% 23.0% 21.9% 19.5%

Major 12.5% 14.8% 13.2% 12.9%

2011 2012 2013 2014(Q1-2)

Education and Academic Qualifications

Of all three verifications, our results show that a candidate’s education history is more

likely to contain discrepancies than any other. Over the three years covered by this

report, more than a third of education checks uncovered a discrepancy, of which nearly

two thirds were considered ‘major’ by our clients.

2012 was the worst year for education discrepancies, with a rate of 37.8%. In 2014 to

date, major discrepancy rates have returned to 2011 levels after peaking in 2012 at

14.8%. The rate of minor discrepancies has fallen overall to 19.5% having also peaked

in 2012 at 23.0%.

40%

30%

20%

10%

0%

21.4% 23.0% 21.9% 19.5%

12.5% 14.8% 13.2% 12.9%

35.2%

Overall: 35.2%Minor: 21.8% | Major: 13.4%



Employment History

2011 2012 2013 2014(Q1-2)

Overall 28.2% 25.8% 23.1% 18.6%

Minor 21.6% 18.3% 16.0% 12.5%

Major 6.6% 7.5% 7.1% 6.1%

One in four verifications uncover discrepancies in a candidates’ employment history.

Major discrepancies have remained steady, peaking at 7.5% in 2012 and averaging at

7.0% overall.

It is here that we see the first strong evidence of recruiters exercising greater tolerance

and adjusting their discrepancy matrices to become less sensitive to, for example, very

short periods of unemployment/inactivity and slight differences in previous job title

and role.

2011 2012 2013 2014(Q1-2)

Employment History

30%

20%

10%

0%

21.6% 18.3% 16.0% 12.5%

6.6% 7.5% 7.1% 6.1% Overall: 25.0%Minor: 18.0% | Major: 7.0%

25.0%



Professional Qualifications, Licences and Memberships


2011 2012 2013 2014(Q1-2)

Overall 24.4% 25.1% 23.1% 20.5%

Minor 14.1% 13.2% 11.8% 12.8%

Major 10.4% 11.9% 11.3% 7.7%

Professional verifications cover qualifications, licences and memberships not covered

by an education check. The rise of ‘diploma mills’ or ‘accreditation mills’, which offer

sub-standard or bogus degrees in exchange for payment with little or no work involved,

has heightened the need for thorough verification of professional achievements.

Almost a quarter of all professional checks have uncovered discrepancies. Peaking

at 11.9% in 2012, major discrepancies have averaged 10.8% during the period whilst

minor discrepancies peaked at 14.1% in 2011, averaging at 13.1% overall.

2011 2012 2013 2014(Q1-2)

Professional Qualifications, Licences and Memberships

30%

20%

10%

0%

14.1% 13.2% 11.8% 12.8%

10.4% 11.9% 11.3% 7.7%

23.9%


DISCREPANCY RATES BY CANDIDATE TYPE

Demand has increased for screening of all candidate types, but particularly contingent

workers and external staff. The decision to look at risk and risk mitigation in this

population is strongly supported by our data.

Our results from verifications carried out over the last three years show that contingent

worker checks are far more likely to uncover inaccuracies than those of permanent

employees. Remarkably, discrepancies are uncovered in almost half of all education

checks and more than a third of employment checks on contingent workers. Although

lower, permanent worker discrepancy rates are still worryingly high, with more than a

quarter of checks revealing discrepancies.

Permanent workers Contingent workers

Permanent vs. Contingent Workers

27.0% 36.3%


DISCREPANCY RATES BY CANDIDATE TYPE

EducationPermanent 35.1% | Contingent 48.1%

EmploymentPermanent 24.6% | Contingent 35.6%

ProfessionalPermanent 23.9% | Contingent 22%

Permanent vs. Contingent Workers

35.1% 48.1%

35.6%

22.0%

24.6%

23.9%


DISCREPANCY RATES BY SECTOR

ProfessionalServices

Technology LegalStaffing/

recruitmentFinancial Services

Overall 37.9% 37.1% 37.0% 35.6% 23.0%

Minor 27.0% 27.2% 30.1% 29.0% 14.0%

Major 10.9% 9.9% 6.9% 6.6% 9.0%

The chart shows that the professional services sector has experienced the highest

average discrepancy rate at 37.9%, closely followed by technology (37.1%) and legal

(37.0%). The banking and financial services sector experienced a discrepancy rate of

23.0%, reflecting greater regulation and a workforce that’s increasingly familiar with

the screening process. This provides an example to other sectors where screening is

less commonplace – the greater the use of screening, the less likely candidates are to

attempt to conceal or misrepresent information when applying for a new job, which in

turn improves the quality of hire.

For the purposes of this report, we’re highlighting the five sectors with the highest

verification discrepancy rates.

Sector Comparison

Sector Comparison

40%

30%

20%

10%

0%Professional

ServicesTechnology Legal Staffing/

recruitmentFinancial Services

27.0% 27.2% 30.1% 29.0% 14.0%

10.9% 9.9% 6.9% 6.6% 9.0%



At 37.9%, the overall discrepancy rate for the professional services sector is significantly

above the cross-industry average of 27.2% and the highest of any sector analysed for

this report. Remarkably, more than half (53.8%) of education checks in the professional

services sector reveal discrepancies, as do more than a third of professional checks and

just under a third of employment checks. That said, both major and minor discrepancy

rates have been falling since 2011.

Professional Services

Education | 53.8% Employment | 30.0% Professional | 35.2%

2011 2012 2013 2014(Q1-Q2)

Professional Services 43.4% 36.9% 34.3% 34.8%

Minor 30.6% 26.4% 25.0% 24.3%

Major 12.7% 10.5% 9.4% 10.4%

Professional Services

2011 2012 2013 2014(Q1-Q2)

40%

30%

20%

10%

0%

50%

37.9%

30.6% 26.4% 25.0% 24.3%

12.7% 10.5% 9.4% 10.4%Overall: 37.9%

Minor: 27.0% | Major: 10.9%



At 37.1%, the technology sector has experienced the second highest discrepancy rate of

any sector analysed for this report. Both major and minor discrepancy rates have risen

during the period.

Almost half (45.1%) of education checks uncovered a discrepancy, whilst the

discrepancy rate of employment checks is the highest of any sector at 35.0% and the

professional check discrepancy rate is well above average at 28.3%.

Technology

2011 2012 2013 2014(Q1-Q2)

Technology 36.2% 37.6% 37.4% 37.3%

Minor 28.0% 26.5% 27.0% 27.8%

Major 8.3% 11.1% 10.3% 9.5%


Technology

2011 2012 2013 2014(Q1-Q2)

40%

30%

20%

10%

0%

50%

28.0% 26.5% 27.0% 27.8%

8.3% 11.1% 10.3% 9.5%

37.1%




Marginally lower than the technology sector, the legal sector has experienced a higher

than average discrepancy rate of 37.0%, with higher than average discrepancy rates

for all types of verifications. Overall, the rate of discrepancy has remained broadly flat

– the consequence of a falling minor discrepancy rate and, most worryingly, a rising

major discrepancy rate. At an alarming 55.9%, the legal sector experienced the highest

education discrepancy rate of any sector.

Legal

2011 2012 2013 2014(Q1-Q2)

Legal 37.2% 34.6% 39.0% 39.1%

Minor 31.5% 28.4% 30.6% 29.9%

Major 5.7% 6.2% 8.4% 9.2%


2011 2012 2013 2014(Q1-Q2)

Legal

40%

30%

20%

10%

0%

37.0%31.5% 28.4% 30.6% 29.9%

5.7% 6.2% 8.4% 9.2% Overall: 37.0%Minor: 30.1% | Major: 6.9%



At 35.7% on average over the period, the staffing and recruitment sector discrepancy

rate has fluctuated since 2011, peaking at 38.3% in 2013.

The minor discrepancy rate has also fluctuated over the period, peaking at 31.4% in

2013. However, of greater concern is the major discrepancy rate, which has risen from

5.0% to 7.8% over the period.

Staffing and Recruitment

2011 2012 2013 2014(Q1-Q2)

Staffing and Recruitment 36.0% 34.2% 38.3% 35.5%

Minor 31.0% 26.8% 31.4% 27.7%

Major 5.0% 7.3% 6.9% 7.8%


2011 2012 2013 2014(Q1-Q2)

Staffing and Recruitment

40%

30%

20%

10%

0%

35.7%


31.0% 26.8% 31.4% 27.7%

5.0% 7.3% 6.9% 7.8%



As screening is required for all financial service institutions in the UK, candidates

working within the sector are well aware that they will be screened and are familiar

with the process. Consequently, discrepancy rates are lower than average at 23.0% for

the period, with more than one in five verifications uncovering discrepancies.

Within the sector, discrepancies occur in nearly a third of education verifications, a fifth

of employment verifications and nearly a quarter of professional verifications.

Financial Services

2011 2012 2013 2014(Q1-Q2)

Financial Services 26.4% 23.8% 20.7% 18.6%

Minor 17.5% 14.0% 11.9% 11.0%

Major 8.9% 9.7% 8.8% 7.7%


2011 2012 2013 2014(Q1-Q2)

Financial Services

30%

20%

10%

0%

17.5% 14.0% 11.9% 11.0%

8.9% 9.7% 8.8% 7.7%

23.0%


Within India:

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Email [email protected]

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We can help. For more information, contact First Advantage today:

As the trusted partner of over 45,000 organizations worldwide, we at First Advantage provide

easy-to-understand background screening results so you can confidently make decisions about

prospective employees, vendors and renters. Not only does this safeguard your brand, but you

also arrive at dramatically better background insights – insights you can rely on.

It’s time to partner with First Advantage. Now in 27 locations, 13 countries and conducting over

54 million international background screens on 16.8 million applicants annually. Trusted Knowledge.

Exceptional People.FADV.com

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First Advantage Background Screening Trends Report: EMEA · First Advantage Background Screening Trends Report: EMEA January 2011 - June 2014 TRENDS REPORT INFORMATION YOU NEED. PEOPLE