Whenever employees apply for a loan/mortgage, credit card, auto loan, job, financial aid, or public assistance, organizations such as lenders, pre-employment screeners, government agencies, apartments, and others processing the applications are required to verify the employment status, earnings, or eligibility with the employer. HR/Payroll personnel are obligated to respond to these inquiries from unknown 3rd parties.
The current VOE and VOI process is tedious and risky. HR/Payroll personnel or the Operations team are challenged with:
- Ongoing and unproductive administrative burdens
- Identifying the credibility and authenticity of the third-party verifier
- Implementing a consistent process across the organization
- Providing timely and accurate responses
As a result, employers are seeking more efficient ways to respond to these inquiries.
For many businesses, outsourcing VOE and VOI is the best option to make sure HR and payroll staff can spend time on high-value, talent management tasks. Working with a third-party provider can also ensure VOE and VOI are done quickly, correctly, and legally compliant.
What are VOE and VOI Services?
It is a solution that provides automated response for employment and income verification requests. It reduces the employer’s administrative burden, lowers operational costs, and mitigates corporate liability and the risks of responding to inquiries from unknown third parties. It improves the employer’s efficiency, standardizes policy across departments/locations, and enhances service to employees that can be critically important to an employee’s financial well-being.
Every HR professional knows the frustration of requesting (or providing) employment verification. Simply connecting with authorized personnel when verifying employment can be a challenging game of phone tag. Multiply that task by more than one past employer, and hours of valuable HR time is spent.
Income verification can be even more difficult. In many cases, workers rely on a quick response from their employer for mortgage, credit, government assistance, or student loan inquiries. Frequently, HR is called upon to verify income in response to a court order; for lawsuits or division of marital property, or for social services purposes. Whatever the reason, income verifications often supersede other, more high-value, HR tasks as a necessary service for employees.
As time-consuming as these tasks are, employers are required to perform them for current and former employees. Failure to do so can put businesses at risk for claims of discrimination or lawsuits.
Maintaining Confidentiality
Income verifications pose a specific risk to employers and their staff. Responding to requests for financial information requires the business to verify the legitimacy of the inquirer. This can mean verifying phone numbers or email addresses, which can easily be forged.
Employers may need to confirm with the employee the request for information is valid. In some cases, signed approvals to disclose information need to be verified or checked against existing employee signatures. Failure to perform due diligence when responding to VOI requests could put businesses and their staff at risk of financial harm.
While VOE requests pose a lesser financial risk, employers should still perform necessary assessments of the requesting party to ensure they have a legitimate need for the staff member’s employment history. These tasks are time-consuming, but if not performed correctly, can have devastating outcomes.
Why Outsourcing VOE and VOI is a Best Practice for Business
Fulfills Employer’s Responsibility
It automatically provides the employment status and earnings information about current and former employees authenticated verifiers, accurately and instantly, and with the employee’s consent, fulfills the eligibility requests from social service, immigration, Health and Human Services (HHS), and Workers’ Compensation agencies.
Saves Time & Money
It reduces HR and Payroll personnel’s administrative burden of responding to multiple phone, fax, and email inquiries, which results in eliminating unnecessary operational costs.
Ensures Security, Privacy & Compliance
The secure system mitigates the risk of sharing employees’ sensitive information with unknown third parties. It protects employee’s privacy as per the Fair Credit Reporting Act (FCRA) fulfilling your commitment to maintain confidentiality and integrity. A full audit trail enables employers to monitor all verification activities online. Risk is further reduced since employees can now directly control and provide consent to the verifiers to access their income records.
Increases Employee Satisfaction
It results in greater employee satisfaction by providing a quick and accurate response to the verifier’s request. Employees are also alerted through real-time notifications whenever someone accesses their files.
All VOE and VOI Providers Are Not Equal
While many businesses rely on VOE and VOI providers, they’re not all the same. Some provide automated verifications, speeding up the process for businesses and employees. For a high level of protection, VOE/VOI vendors, such as empinfo, allow access to data only by approved verifiers, and only with explicit employee consent.
To enhance employee satisfaction, look for a provider that creates a user-friendly, easy-to-remember verification process that removes the burden of remembering infrequently used credentials to provide consent.
A number of providers, store employee data offsite on servers that may put personal information at risk. In 2017, a major provider discovered that, in only a few months’ time, hackers had accessed the personal and financial data of over 147 million people. They agreed to a global settlement with the Federal Trade Commission, the Consumer Financial Protection Bureau, and 50 U.S. states and territories of about $425 million to address the breach. To ensure a high level of protection, use a VOE/VOI provider that does not operate as a data warehouse and store employee data on their servers.
Finally, some providers sell employee data to third parties. When you read the fine print, they may sell individual information or aggregated demographics. In either case, it’s unlikely businesses or employees are happy their personal data is for sale, particularly if the data is sold for debt collection purposes.
Choosing the Right VOE/VOI Provider for Your Company
Opting to outsource VOE/VOI is an easy decision for businesses. Removing these low-value, high-risk tasks from your HR team’s list of responsibilities will be appreciated and applauded. The challenge for business is to find the right provider for their company.
Look for a vendor that not only provides automated responses for the fastest VOE/VOI services but also goes the extra mile to provide great customer support. Make sure the vendor verifies the information they’re providing is being given in response to legitimate requests. For even higher protection, find a provider that doesn’t store employee data on their own servers, which can be attractive to hackers. And finally, look for a provider that never sells employee data, either individually or in the aggregate.
Which VOE/VOI vendor provides all those services and protection? Inova’s newest partner, Empinfo. Even better, the service is free. Get more info today on how you can free up valuable HR time and receive the best VOE/VOI services available.
