Contractor Verification System

90% of U.S. Firms neglect to screen contractors [1]. Despite the number of contractor relationships that thrive in the workforce, historically contractors have not been screened.

Unfortunately, although contractual employment relationships are prevalent in the U.S., so are the lawsuits that occur as the result of the employing company should have a contractor verification system to ensure that their contractors are screened prior to performing work.

Luckily, there’s a simple solution: contractor screening. In fact, many companies have picked up on the recent trend of employing a third-party contractor verification system, to ensure their contractors are pre-qualified for work. Contractor verification systems are designed to screen your contractors and suppliers that come on site or support major portions of your business.

In the past ten years it’s become quite common to see large Multinational companies who employ thousands of contractors every year to the big company to hire a third-party contractor verification system to pre-qualify and manage suppliers. These contractor verification systems are a highly effective way of ensuring that your company avoids a potential lawsuit as the result of employing an unsafe or unethical contingent worker.

Developing and maintaining a world-class contractor verification system can be easy. It’s a matter of properly collecting, organizing and centralizing your contractor data into an efficient database. The information that you gather should then be reviewed and verified for accuracy:

1. Documents- Each contractor should complete a qualification form which can be reviewed for contractor licenses and compliance with regulation requirements.

2. Insurance – Insurance statistics are an important indication of how qualified your contractor is and should be reviewed for accuracy and adequate coverage.

3. Safety Information- For those companies with a higher level of safety, audits should be performed on your contractor’s Safety Manual and implementation of their safety plan.

4. Employee Information- Background information should be collected including drug screening and past history on those employees engaged in important company activities.

Awareness in selecting safe contractors and subcontractors cannot be overrated. Choosing a safe team using an effective contractor verification system greatly reduces risk and minimizes incidents. Incorrect documentation, inadequate insurance coverage and be an employee’s prior disruptive or destructive performance can severely negatively impact your business.

By evaluating the criteria we discuss above, implementing a contractor verification system and keeping up with regulatory changes and best practices, you can avoid lawsuits and protect your company. These simple measures can save you millions in losses and damages every year.


[1] Source: Screening Contract Employees: An Important Slice of Corporate Security. Jennifer