Checkr, the background-screening platform last valued at $5 billion, has cut 32% of its workforce.

Checkr, a startup that's been around for 10 years and is known for providing employee background checks, recently faced a major change. In April 2022, Checkr was valued at $5 billion, but it has now laid off 382 of its employees due to a slowdown in hiring across companies. This information was exclusively reported by TechCrunch, indicating that the layoffs occurred on Tuesday and affected various departments and levels within the company. The startup, which calls San Francisco its home, confirmed these layoffs via an email statement.

The decision to cut jobs came as a response to economic conditions that have negatively impacted the rate at which companies are hiring. According to a spokesperson from Checkr, this tough decision was made to 'reduce the size of our team' in an effort to run more efficiently and secure the company's future health. Remarkably, these job cuts represent 32% of Checkr's workforce. This downsizing happened almost two years after Checkr acquired Inflection, a company behind the background-check platform GoodHire, intended for small- and mid-sized businesses—a deal that was reported to be worth $400 million.

Checkr has the support of reputable investors like Durable Capital Partners, Fidelity Management & Research, Franklin Templeton, BOND, and Coatue Management. The company's services enable businesses to perform detailed background checks on potential employees by examining driving and criminal records, along with verifying their identity. Checkr offers these services through an easily accessible online form or an API, which can be woven into a company's hiring or onboarding software, including platforms like Workable and Zenefits.

Since its founding in 2014, Checkr has grown significantly, serving clients like Uber, Instacart, Netflix, Adecco, Airbnb, and Coinbase, among others. In 2022, its clientele expanded to include tens of thousands of companies ranging from small businesses to massive Fortune 500 corporations. Initially focused on Silicon Valley, Checkr broadened its reach in 2016, extending services beyond the tech hub.

In light of the layoffs, Checkr has put together a severance package for the affected employees. This package includes a minimum of 10 weeks of severance pay, continuation of health insurance, and access to career and mental health support services, as confirmed by the company's spokesperson.