What information related to income can prospective employers get through their background checks?
WAG, but I strongly doubt employers (at least in the U.S.) can get your previous salary without a release form signed by you.
Depending on who you worked for though, your salary (at least the range) might be known. For example, the federal government publishes all salary ranges. Some states will release all salaries for individual employees. And if you work for a large corporation, others in the industry may have a good idea. For example, an “Engineer I” at Caterpillar, Inc. may be known to make $46,000-$54,000 (made up example).
Has someone oversold their previous position?
No. But I’m curious whether a new employer will use that data to adjust compensation.
Every place I’ve ever worked would confirm dates of employment, but wouldn’t give salary figures. However, they would confirm salary figures for a credit application. Of course, on a credit form, the small print gives the lender the right to ask that kind of question.
One should expect anything that’s legal a new employer will do to investigate an employee.
And anything illegal if they think they won’t pay a price for it.
It would be difficult for a company to determine your salary from a privately held company if that company does not disclose it. Credit agencies usually don’t have accurate information about salaries. They may be given a figure from the time of a credit application, but it won’t be kept up to date. Most recorded income figures do not break down the sources of the income, although that would indicate what your max pay was. If you work for the public sector or a public company, your salary may be public information and available to anyone who spends enough time looking.
They can look at your former salary.
It can help them understand what your previous jobs really entailed. You claimed to be a senior programer, but you were only paid $8.00/hour. Maybe you weren’t such a senior programmer after all. Or, if you went from a job that paid $100,000/year to one that paid $80,000/year to one that paid $70,000/year, it could be an indication that your interview skills might be better than your job skills.
It also works the other way too. If you are use to making $150,000 per year, you might not be happy with a job that makes only $45,000 per year.
Yes, they can confirm factual data on an application. The way to fudge this is use “base + bonus”
So you might say instead of $50,000/year, $45,000+ bonus.
Also if you’re in an industry most H/R will likely know what you’re likely to have made and wonder about differences too big or too little.
Most employers will take your past salary and offer it to you or a bit more. That was in the past. This recession has given employers remarkable power to get people to take less. Sometimes a lot less.
The fact is, unless your prospective employer is a small company, the salary for any position is pretty much budgeted so offering too little isn’t helping anyone.
For instance, if you want $50,000 and the positon is budgeted for $60,000 the H/R dept doesn’t get a bonus for saving that money. So H/R isn’t really concerned about money, they just want to stay in budget.
Of course if it’s a small company the owner will have a hands on look and he WILL be concerned about it.