Do you know what it takes to succeed in today’s business climate? While every company is different, we’ve found that there are a few commonalities that set fast-growth companies apart from zero-growth businesses. In Asure’s recent 2024 HR Benchmark Report, we looked at recruiting and hiring, benefits, onboarding, development, compliance, retention, performance, and post-employment. 

Unsurprisingly, zero-growth and fast-growth companies had different answers to many of these questions. When it came to recruiting and hiring, fast-growth companies were more likely to be in legal compliance on a variety of components. However, there are still many ways that both types of companies can improve their hiring and recruiting practices. 

What We Found Out in Our HR Survey About Recruiting and Hiring 

In the recruiting and hiring segment of our survey, we dove into how compliant companies are with written job descriptions, job postings, interviews, and job applications. We also looked at whether fast-growth companies were more or less likely to conduct background checks on job candidates. 

1. Do You Have Written Job Descriptions for Each Opening?

First, we asked over 1,000 small businesses if they had written job descriptions for each opening. We received the following results: 

• 76% of zero-growth companies have written job descriptions for each opening. 
• 80% of fast-growth companies have written job descriptions for each opening.

In a recent Mission to Grow podcast, “HR Benchmark Report: Chapter 1,” Mary Simmons, Asure’s VP of HR compliance, learning, and development, spoke about how this result was surprising to her. She said, “We do Fair Labor Standard Act audits all the time, and you can’t do it without a job description. We work with all types of companies–fast-growth and not-so-fast growth–but very few employers have up-to-date compliant job descriptions.”

For example, some employers use the same job description for multiple positions. In other cases, the description isn’t compliant. Often, companies use a cookie-cutter job description instead of an FLSA-compliant description. 

When a company does an FLSA audit, the job description is used to determine who is exempt and non-exempt. In some cases, Simmons says, “We have to do 15 job descriptions for them because they had two out of the 15 unique positions they have at their organization.”

This question is likely a good example of quantity over quality. Many companies have produced written job descriptions, but these descriptions aren’t as compliant and well-written as they should be. 

2. Do You Conduct Background Checks on Candidates Before They Start Work? 

Next, we asked businesses if they performed background checks on candidates before they began their first day of work. Our results on background checks had the largest spread of all five recruiting and hiring questions.

• 81% of fast-growth companies perform background checks.
• 67% of zero-growth companies conducted a background check. 

In the podcast, Simmons discussed a recent client that had $36 million in revenue and no background checks for the five people in charge of managing the company’s finances. When so much financial control is placed in the hands of just a few people, getting a background check is generally a good idea. 

With background checks, companies can learn the following information. 

• How truthful applicants are on their resumes.
• The presence of related convictions, like larceny convictions for an accountant.
• If the applicant presents safety risks to other employees and customers. 

Background checks aren’t just for someone’s criminal history. Depending on the type of check you ask for, you can get their work history, educational experience, and other qualifications verified. 

By making sure applicants are who they say they are, fast-growth firms are less likely to have high turnover from badly matched applicants. Over time, this can reduce training and hiring costs. Plus, background checking your applicants means you’re less likely to have issues with fraud and embezzlement at the top levels of your organization. 

The main reason many companies don’t background check is that they are uncertain about the costs and benefits. They don’t know why it is a good idea, and spending $50 to $300 per applicant seems expensive. Compared to the cost of firing the worker and training a replacement, background costs are a nominal expense. When you use a payroll and HR provider like Asure, you can get clients can get background checks included with payroll and HR services.

3. Are You Certain Your Job Postings Are Compliant With Federal, State, and Local Laws? 

The third hiring and recruiting question involved job posting compliance. 

• 93% of fast-growth companies believed their job postings were compliant with federal, state, and local laws. 
• 8/10 zero-growth companies could say the same thing.

There are many potential pitfalls that can happen with job postings, and even fast-growth companies are likely unaware of these compliance issues. For example, many states have laws about providing salary ranges. Even when a business complies, there are often specific rules about how broad the salary range can be and how it’s supposed to be disclosed. 

Likewise, there may be aspects of the job posting that are unintentionally discriminatory. Requiring a car for transportation may discriminate against certain protected classes. Additionally, a job that unnecessarily requires heavy lifting, such as expecting an admin to lift 50 pounds, may discriminate against people who have disabilities. 

Judging by the survey response, fast-growth companies are more aware of compliance issues with their job postings. However, our on-the-ground experience shows that many businesses are unknowingly creating non-compliant job postings. 

4. Are You Certain Your Interview Process Is Compliant and Effective? 

Small businesses were also asked how compliant and effective their interview process is. 

• 88% of fast-growth firms are confident their interview processes are compliant and effective.
• 75% of zero-growth firms believe they had compliant, effective interviews.

In Simmons’ experience, many business owners like asking applicants about their personal lives, hobbies, and favorite things to do on the weekend. While the interviewers just want to get to know the applicant, these types of questions are problematic. 

If you ask someone about what they do on the weekend, they might tell you that they go to church, volunteer for an advocacy group related to their ethnicity, or get kidney dialysis. All these answers suddenly open you up to discrimination and disability issues. 

To avoid legal issues, remember the following interview tips:

• Focus on the job description as you make your questions.
• Create a set of questions that you will use in every interview. 
• Use behavioral interviewing to get a feel for how they will perform in future situations.
• Ask questions about past performance, like how they’ve dealt with a challenge at work.
• Notice how quickly and competently the applicant answers questions. 
• Don’t make small talk. 
• Train interviewers on the process. 

By asking everyone the same questions, you can avoid discrimination complaints. Behavioral interviewing, questions about past performance, and the way someone responds to questions can all tell you a lot about how they will perform in a new role. For instance, a salesperson who stays friendly and calm during the stress of a job interview may perform well on a stressful sales floor.

Keeping the focus on job-related competencies and behavioral interviewing can pay off. Research shows behavioral interviews were 55% successful at predicting future job success. Traditional interviews had a predictive value of just 10%.

5. Are You Certain Your Application Doesn’t Ask Any Illegal Questions?

Finally, we asked applicants if they were confident their job applications did not include illegal questions. 

• 82% of zero-growth companies said their applications didn’t have illegal questions. 
• 86% of fast-growth businesses believed their applications didn’t contain illegal questions.

While zero-growth and fast-growth companies had similar responses to this question, there is still more work to be done. For example, consider the following issues. 

• Around 20 states have ban-the-box initiatives that keep you from asking about felony convictions on an application.
• Some applications ask for Social Security numbers before making a conditional offer of employment.
• Asking about the year someone graduated high school could lead to age discrimination claims.
• Certain states, like Maryland, California, and Massachusetts, have specific legal notifications that must be included on your resume.

Additionally, companies should get the employee’s signature saying that the application is true and valid. Many employers don’t understand the value of applications because resumes cover a great deal of the same information. However, a resume is basically a marketing document for the applicant. An application is a legal document. 

By getting the application signed, you make it easier to terminate an employee who lies on their application. For example, some workers might lie about reasons for being fired or job gaps. An application is a legal document, so it benefits the employer to get signed applications from prospective workers. There’s no legal rule that says you have to collect applications, but they are generally a good idea.

Why Are These Recruiting and Hiring Practices More Likely at Fast-Growth Companies? 

While the 2024 HR Benchmark Report doesn’t question why fast-growth companies were more likely to answer in certain ways, there are a few common factors that may explain this connection. 

Long-Term Focus 

Fast-growth companies think long-term, so they’re more likely to adopt these HR practices. Even when certain activities, like background checks and thorough interview questions, require more effort, fast-growth companies will put in the work. 

Business Knowledge 

Additionally, fast-growth businesses are likely to grow quickly and use better HR practices for the same underlying reasons. These companies can expand quickly because the owners and managers know more about the ins and outs of running a business. For the same reason, they are more likely to be familiar with hiring and recruiting best practices.

Employee Quality 

With better HR practices, you are more likely to get better, more productive workers. For example, background checks can weed out applicants who lie about their qualifications. Clear, compliant job descriptions make it easier for qualified applicants to tell if your job is the right fit, so the applicants who do apply are a better fit. 

Legal Compliance 

If your HR practices aren’t legally compliant, it can lead to discrimination claims, EEOC disputes, and lawsuits. Fast-growth companies follow HR best practices, so they aren’t hampered by legal issues. In turn, saving money on lawsuits allows them to spend more money on running their business. 

Learn More About How You Can Ensure HR Compliance in Your Hiring and Recruiting Practices

As a small business, there are a few distinct factors that separate fast-growth companies from zero-growth companies. At Asure, we offer support with FLSA compliance, background checks, and designing behavioral interview questions. 

If you’re ready to supercharge your company’s growth, consider the real impact of HR best practices. Connect with one our small business HR and payroll experts today to get access to certified HR experts for a fraction of the cost.