The Future of DEI and Fair Chance Hiring in 2022

Numerous data studies have proven the close relationship between diversity of workforce and business success. Consider that employee performance in diverse organizations is 12% higher than in companies with no inclusivity efforts. Or that Harvard Business Review found that having a high sense of belonging can increase job performance by 56% or more, reduce turnover by 50%, and significantly decrease the number of sick days.

Yet, organizations still have work to do to accomplish true diversity and belonging. Checkr’s recent Fair Chance Hiring Report found that most employees either don’t believe (24%) or are unsure (40%) if their company prioritizes DEI in the workplace. Furthermore, roughly one in three (31%) say their company’s hiring process is prejudiced against certain populations and they feel that people with conviction histories face the most discrimination (75 percent).

Checkr’s mission as a technology company in the background check industry is to build a fairer future by designing technology to create opportunities for all. It’s no surprise that at our annual event, Checkr Forward, we hosted dozens of fair chance hiring experts who shared their insight on tackling the issue of justice-impacted discrimination and building true belonging in the workplace.

Here, we’ll share four of the top lessons we learned on the future of DEI and fair chance to guide DEI efforts at your organization.

There is no one-size-fits-all solution to DEI. In fact, it’s important to note that simply hiring diversely won’t fix your equity problems. Successful DEI requires deep integration and a reshaping of legacy structures through technology and culture.

One aspect of a DEI strategy lies in onboarding debiased hiring technology. Martine Cadet, VP of Social Impact, pymetrics, offered, “It [technology] can really help [organizations] hone in on ‘where is change needed?’ As well as put in the appropriate metrics that help reinforce and encourage the equitable behavior that we want to see. And then that helps bring in and foster a culture of transparency and long-term accountability.”

Using software that helps debias the hiring process, whether that’s anonymizing applications or tracking diversity metrics, is one aspect of a successful DEI program. Cadet continued, “If we can focus on the underlying systems and the platforms, we can actually drive that long-term benefit that people are looking for.” But technology can only take you so far.

Find and use technology that helps you reduce bias in the hiring process. You also need to identify and “focus on the underwater cultural drivers of behaviors,” as Griggs put it.

“It’s not solely platforms and systems change, or solely hearts and minds change, I think they have to come in combination with each other to get to those true, comprehensive strategies,” added Cadet.

Hear DEI and hiring experts discuss why DEI should extend “beyond the color of your skin” in the session, “Why Diversity & Inclusion Are No Longer “Nice-to-Haves,” by clicking below.

Creating an effective DEI strategy requires both systems and minds. In 2022, companies will work to marry their debiasing technology with ongoing leadership and employee discussions on topics like inherent bias, affinity bias, and the importance of belonging for long-term business success.

And while many organizations will prioritize DEI in 2022, some still don’t understand the business benefits. Let’s discuss why DEI, and more specifically, fair chance hiring, are critical to the bottom line.

A person with a criminal record, whether or not they have been incarcerated, experiences collateral consequences. The record affects a person's ability to secure housing, gainful employment, and acquire credit.

But many business leaders will ask themselves, “Why should I care about DEI or fair chance hiring?” “How does it affect my bottom line?” Ken Oliver, Executive Director, Checkr.org, answered that very question, “If there’s 70 million people who can’t access the economy in a meaningful way, the way that everybody else is accessing the economy, that means there’s less money going into the business. There’s less engagement from your customer base in a particular community… that means that you don’t have reach and touchpoints with many people who could become your customers and who you have an opportunity to build a relationship with.”

Simply put, when we ignore formerly-incarcerated individuals and deny them access to jobs, we’re putting the economy at a disadvantage. And a bad economy is bad for business.

Jeff Korzenik, Author, Hidden Talent: How Second Chance Hiring Works for Your Business and Community, offered another reason why fair chance hiring impacts business's bottom line: “If we can look to pools of people who have been marginalized from the labor force, we are more prosperous as a country and we also have stronger and safer communities.”

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Like any successful business initiative, fair chance hiring requires careful consideration and planning. Korzenik mentioned, “Pioneering business owners around the country have developed processes for uncovering who in this pool is truly ready to be a great employee and contribute to a company and also setting up a process that provides the support that they need. It’s very important that businesses, particularly those who may have tried tapping this population, but didn’t do it the right way, understand that there is a right way to do this and that it is not a textbook exercise but rather something other businesses have done. “

Go and visit companies who have executed fair chance hiring successfully. Talk to potential non-profit partners who can help you identify and support this talent pool.

Yes, it takes sacrifice and investment, but as Korzenik put it, “The trade off is that when you make this investment you get a positive return. And that positive return is evidenced very consistently in studies that have been done that show that when you find someone who is ready to turn their life around and rebuild their life and prove they are more than their worst mistake, that’s a highly engaged, dedicated employee. High engagement and loyalty, staying in one place, low turnover, tends to drive productivity and profitability.”

Listen to the riveting discussion between Ken Oliver and Jeff Korzenik in, “Hidden in Plain Sight: Untapped Talent,” by clicking below. We can’t recommend this one enough.

Fair chance hiring has concrete business benefits. Educate yourself and your team on how to launch a fair chance hiring effort at your organization to not only build a diverse  and representative workforce, but to increase productivity and profitability. There are solutions and strategies to help you along the way, which we’ll dive into next.

We can’t talk about 2021 without mentioning the Great Resignation and tight labor shortage. Many companies are struggling to find workers to fill their employment gaps. Korzenik posited, “The solution must lie with people we have unintentionally or intentionally overlooked. So to deny the pool of tens of millions of workers who have a criminal mark on their record from our applicant pool is simply something we can no longer afford to do.”

With declining birth rates and the increased pace of baby boomer retirement, Korzenik reminded us that hiring outside our normal talent pools, “...is no longer an option. It’s a necessity. The labor force shortage that businesses are feeling now is not going away.”

But there are many misconceptions about individuals with criminal records. For example, Korzenik remarked, “We generally talk about this population as only the formerly-incarcerated. That’s actually a subset of this population. For example, even with felonies where we have 19 million Americans with a felony conviction, fewer than half were convicted of a crime that was such a threat to public safety that it actually required a prison sentence. So felonies are often not what we think they are.” Many traditional adjudication or evaluation processes don’t allow us to see past the criminal record on a job application.

One way companies can effectively open their hiring pools to system-impacted candidates is to use Candidate Stories. Candidate Stories give job seekers the opportunity to offer context about their record during the assessment process.

Often, we make assumptions about what a record means when in fact, there’s an entire story behind it that can help us contextualize the incident and properly determine a candidate’s fit for a specific role.

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Allen Lohse, Director of Legal & Regulatory, Lyft, shared the Candidate Stories inception story, “We partnered with Checkr several years ago… we leveraged the Checkr Candidate Stories product to reach out to our applicants and give them the opportunity to explain their criminal records, what happened, and how they’ve changed–and we saw a high engagement rate. And we were happy to take in those stories. Some of them were heartwarming and we ended up onboarding a lot of candidates who we wouldn’t otherwise have.”

To date, Candidate Stories is being used by 1,750 Checkr customers. The product has processed 320,000 stories, with 21,800 candidates hired because they shared context and additional information around their record as well as rehabilitation, accomplishments, and growth that shows employers who they are today, not when they made a mistake.

Watch “Legislation Up for Vote: The Intersection of Compliance and Fairness,” where experts from Lyft, Compass Group, and Checkr show you how to take the stress out of compliance and fairness. Click below.

Humanizing a criminal record can often make the difference between a job rejection and a job acceptance. Instead of immediately screening applicants out of the hiring process, Candidate Stories allows hiring managers to screen more qualified individuals into their workforce.

While some individuals are open to fair chance hiring, they still fear that by doing so, it opens them up to undue risk. On the contrary, federal laws set forth by the FCRA and regulations and guidelines set forth by the EEOC are increasingly encouraging, and in some cases requiring, employers to adopt fair chance hiring standards.

Brian Troxler, Director of Employment Screening, Compass Group, spoke about his experience navigating the complexity of hiring compliance, “We have a great partnership with our internal legal department who are constantly scanning the landscape for changes. As those changes come through we bounce them up against our practices and see if there needs to be policy changes, do we need to have training, do we need to have internal communication. And I think what's important there is that we continue to have that ongoing cycle.”

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It’s critical to iterate on your hiring policies, especially when a candidate’s record needs review. Amanda Agan, Assistant Professor, Rutgers University, observed, “It’s very hard to find applicants in this particularly tight labor market. It could be that with the policies you’re already implementing—you’re inadvertently making it too hard with current screening policies. There is the potential that you could relax some of your background check adjudication policies and increase opportunity without necessarily increasing risk.”

Agan is working on a body of research in tandem with researchers at MIT and Harvard to provide concrete evidence that relaxing or adjusting adjudicating criteria may not increase your level of risk. Agan continued, “We hope that you can use experiments to refine your screening rules, and likely hire more workers with less adverse impact and no meaningful change in risk.”

Learn about initial findings from the Rutgers, MIT and Harvard initiative, Work of the Future, on enhancing fair chance hiring without increasing risk. Click below to watch.

Work with your legal counsel to determine the best next steps in evolving your hiring assessment process. Audit your adjudication criteria and see if there are areas where you’re being too strict. Ensure you’re evaluating candidates using the nature-time-nature matrix, and take time to consider the benefits of hiring previously incarcerated individuals.

The future of DEI and fair chance hiring can be found in systematic and structural change. Sourcing, recruiting, and hiring diverse talent has become table stakes. In turn, organizations must meet the challenge by making investments across technology, policies, and systems of belief to ensure long-term success.

For more insight into the future of work in 2022, find 5 Great Ideas for the Future of Work and Hiring in 2022.

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