Background Checks and Employee Screening in Germany

Germany is an economy that boasts of one of the most skilled, educated, productive, and professional workforces in the world. If you are looking to hire in Germany, you must run a background check and employee screening before onboarding candidates to ensure accurate claims and credentials.

This article talks extensively about employment background checks in Germany and everything you need to know about background check processes in Germany.

Employment background verification is the process of confirming the authenticity of the information provided by your employee. A typical employment background verification process includes checking these details — 

• Employment history
• Financial records
• Commercial records
• Criminal records, and
• Any other information such as address, educational qualifications, etc.

Although background verification can be time-consuming, pre-employment background checks in Germany have several benefits including — 

• Increase in the quality of job applications: Pre-employment background checks in Germany ensure that the candidates provide information that is accurate and relevant to the job requirement. In recent years, employers reported improved job applications when they started regular background checks. This is because – 

1. 1. There are reduced misstatements and discrepancies in job applications
   2. Job applicants with prior employment and other serious issues do not apply, while individuals looking for a safe workplace and a dynamic environment feel encouraged to apply.

• Reduced workplace conflicts: Employers in Germany are legally required to provide their employees with a safe workplace. Therefore, it is common to conduct a criminal background check to ensure job applicants with substance abuse, reckless behavior, violent behavior, theft, or dishonesty are screened.

• Protection from retention liability and negligent hiring:  Retention liability and negligent hiring can lead to many issues for employers, including lawsuits for not knowing details of their employees or falsifying information provided by them. The details provided by their employees include educational qualifications, past employment experiences, etc., that play an essential role when hiring.
• Other issues include public misconduct that certain employees may cause. This can be easily avoided by employers when pre-employment background checks are conducted.
• Several background check tools help businesses look for a candidate’s education details, criminal records, license, and previous employment verification. Checking such areas helps uncover discrepancies and potential problems in an individual’s application.
• Reduced employee dishonesty: Several companies incur losses due to employee dishonesty and occupational fraud. Background checks help raise red flags in a candidature and avoid future disputes.

Although there are no provisions in the German laws for background checks, it is common for employers to conduct pre-employment background verifications in Germany. However, it is advised to use the term ‘information verification’ instead, as Germans do not appreciate the concept of background checking.

Taking consent to conduct appropriate background verification is crucial, ensuring attention to proportionality. This is because the German culture and laws pay close attention to such factors. 

For example, you can only do credit checks and criminal background checks in Germany when deemed proportional and appropriate.

Employers across the globe look to hire the right talent to join their teams. Thanks to digitalization, expanding teams to multiple countries has proven to be a boon. However, to avoid any negligent hiring, it is crucial to ensure background checks are done.

You must keep the following in mind when performing a background check in Germany.

• You must notify your potential or hired employee before conducting an employment background check in Germany. The document notifying the candidate must be different from the application form.
• The candidate must provide written consent and confirmation to conduct a pre-employment background check in Germany.
• If certain roles in your organization call for mandatory background verification, you must clearly outline it in your organizational policies and when hiring employees.
• Any employee already on the payroll is entitled to be notified if verifications are being conducted for lifestyle, reputation, character, or history.

Certain information is essential for pre-employment background checks in Germany, including: 

Employment history 

Employers commonly check the employment history of experienced professionals to ensure that the information provided is correct. An employment background check in Germany typically includes the candidate’s work history, medical history, and performance indicators with the previous employer.

Information needed to run an employment background verification in Germany includes – 

• Name 
• Date of birth 
• Current address 
• Social security number 
• Consent of the candidate/applicant
• Prior employment history

Education history and licenses

Education qualifications and licenses for certain professions, such as lawyers, doctors, engineers, professors, etc., are essential. Verification of educational qualifications is necessary as this process brings out the authenticity of the licenses and qualifications of the applicant. 

A few other licenses that must be checked include — 

• Military records
• Educational licenses (certain examples include CFA, CIMA, FRM, and licenses required to practice as a lawyer and a doctor).

Criminal record

A criminal background check in Germany is one of the most commonly used background verification tools and is also known to be one of the most misunderstood and complex verifications. 

Employers commonly check the employment history of experienced professionals to ensure that the information provided is correct. An applicant’s criminal history could impact your workplace safety and negatively affect job performance. 

For example, if you are hiring an inventory stock manager to oversee your funds and inventory, you need to hire someone trustworthy. In such cases, a criminal background check will help ensure no theft or fraud charges have been leveled against the applicant.

Credit report

Credit background checks in Germany are conducted if you are looking to hire for positions in your finance department or if you are a bank. Credit background verification helps ensure that the applicant or the employee’s credit to debt ratio is in check and details how they handle finances in their personal life.

Identity verification

Identity verification checks in Germany help verify the authenticity of the applicant or employee. Identity verification shows who the employee is, where live, and if they have any prior criminal or civil litigations. 

Reference checks

Reference checks are common in pre-employment background checks in Germany. Employers commonly ask for two to three references from previous employers (ideally supervisors and colleagues) for experienced professionals and university references for freshers. 

Reference checks ensure the authenticity of an application by confirming past employment, performance and any misconduct in the previous workplace.

When you look to hire employees and expand your team, you must understand the process involved in background checks in Germany. Below is a step-by-step process of legally conducting a pre-employment background verification in Germany.

• Create and implement a consistent background check policy. Ensure you have a written background check policy with information on

1. 1. The types of background checks you will be conducting
   2. The positions you are hiring for
   3. The timeline for when you will conduct the background checks
   4. How the background verifications will impact your employment decisions 

• Creating a comprehensive policy enables you to have a transparent and fair verification process across all departments of your organization.
• Ensure your background verification policy is legally compliant. German laws are relatively complex, so you must consult and run your policy with your legal counsel.
• Partnering with the right pre-employment background check company is key. Your background verification partner will depend on factors such as your 

1. 1. Business size
   2. Hiring volume
   3. Size of your HR team
   4. The number of office locations
   5. Budget
   6. In-house legal team
   7. Background screening policy 

• To avoid penalties, you must ensure that your partner complies with all the regulations laid out by German laws.
• Inform your candidate/employee. As mentioned earlier, you must inform the candidate that you will be conducting background checks to verify the details provided by them. 
• You must take permission in writing to avoid any legal issues. If you consider hiring the candidate, you must share the results from the background check.  
• You can now decide whether to hire the candidate based on the conducted background check.

Almost all industries call for a background check in Germany. However, there are certain situations where background checks must be conducted and are suitable. 

Safety

Workplace safety is the responsibility of the employer. Therefore, it is common for employers to conduct background checks in Germany to ensure that the candidate is not a legal liability or does not cause any type of harm, including to: : 

• The business, its image, and finances, by causing issues of disrepute 
• Other employees, through workplace violence or harassment in any form
• The customers. For example, sexual assault or workplace violence on business premises 
• The public. For example, negligent driving.

Maximize productivity

Past performance during an employment tenure is an important indicator for future performance and goal setting. It also reveals aspects such as an individual’s productivity, professionalism, job skills, and interpersonal skills. A reference check or a pre-employment background check can help you with details on past performances.

Data verification

Verifying the applicant’s employment history, tenure, and educational qualifications is crucial, especially in industries that require specific skills and knowledge. Misrepresentation of information on a job application or an applicant’s resume can hinder the output and be a legal issue for the employer.

Globalization  

Pre-employment screening in Germany is becoming increasingly complex as businesses continue to look for talent in the international job market. Employers recognize that employee background checks are essential and a complex process. It is important that employers stay compliant with the local laws on background checks.

Screening of contingent workforce

With the recent changes in hiring processes across the globe, it has become common for employers, especially in Germany, to use a non-traditional form of staffing such as hiring independent contractors, temporary/part-time employees, or freelancers on an as-needed basis. This opens the door for different liability issues compared to working with full-time employees. Therefore, employers conduct background checks in Germany to protect themselves from any potential legal troubles.

Hiring employees and expanding in a highly competitive environment with highly skilled employees can be daunting. Partnering with a Professional Employer of Record (PEO) and Employer of Record (EOR) platform such as Multiplier can help you ease into the process.  Our team of in-house professionals helps in compliantly onboarding your employees and providing the best benefits while you focus on expanding internationally.

Talk to us to learn more!