Mr. Herbert

Human Resources, Recruitment & Training

Do Your Due Diligence Before Making a Hiring Decision

By Brian Herbert, Director, Phenix Investigations

There is one thing that can save employers thousands of dollars, reduce liability exposure, increase morale and retention, and save managers hours of frustration. This one thing also happens to be the most overlooked element of the human resource functions performed by an employer. What is this mystery element? It's a pre-employment screening process or background investigation.

Background checks aren't just for FBI agents or the military. Instead, they are essential tools for employers to determine they are hiring the right person. No position is too big or too small to not warrant a thorough background investigation. Not doing the due diligence before hiring someone can only lead to trouble.

"Companies that don't do thorough background checks before they hire employees usually end up with employee-related issues," said Brian Bauer, President of Phenix Investigations. "A complete background check will ensure the prospective employee is truthful and will ensure the employer knows of any issues up front."

Most employers do some sort of internal or external background investigation process before hiring an employee, but the depth of that process varies widely. Some employers only verify past employment and possibly education, while others choose to also review criminal histories, driving records, drug screening and sex offender verification. Even within these elements, there is a great deal of variance as to the comprehensive nature of the information obtained.

A comprehensive background investigation starts with a consistent plan. Some employers may choose to complete some of the plan internally and have outside vendors complete some of the elements or they may choose to have a vendor provide all of the services. When choosing a vendor to assist with background investigations, it is important to determine how thorough the investigation will be. Ask for sample reports from other clients. Find out how long the company has been doing background investigations and how many clients they service. Ask them to explain where they obtain their criminal histories or driving records from. All of these questions will help you gauge how much value you are getting for your money.

Several basic elements should be included in every pre-employment background investigation. These elements should be included regardless of the individual's job description or previous experience. Any employee truly interested in working for the organization will consent to a fully background investigation. This consistent commitment to investigate all prospective employees will pay multiple dividends.

"We find pre-employment screenings to be a crucial component in making informed hiring decisions and they are included in the application process for all individuals joining the firm," said Stephanie Sambol Carter, Director of Recruiting for Bose, McKinney & Evans, LLP, a law firm with offices nationally.

According to a 2006 survey by Right Management of over 400 organizations across North America, over 42% of the companies that responded said that replacing a bad employee costs over three times the employee's salary. These costs are attributed to lost productivity, severance payments, recruitment of a new employee, and training to get the new employee up to speed. This could all be avoided in most cases by simply performing a thorough background investigation.

A thorough investigation begins with a quality interview. The interviewer should ask a variety of questions designed to get the prospective employee to disclose specific information about their previous employment and education. This will give the prospective employer a variety of information to be able to verify after the interview ends.

After conducting the interview and determining that the applicant would be a good fit for the organization, the employer should then conduct a thorough background investigation. This should include, at a minimum, verification of previous employment, educational verifications to include college and high school, a criminal record check, a driver's license check, and verification of any specific information the applicant provided during the interview. Each of these elements has a specific purpose which can help predict the future behaviors of the applicant should they eventually be hired.

In today's world, privacy has become a paramount issue. This has begun to hinder the employment verification process as it was traditionally conducted. Now most companies will only verify a former employee's dates of employment, job title, and possibly their salary information. That's about it and lots of companies now use automated systems to do this, which don't even allow the verifier to speak with an actual representative of the company. While this has streamlined the process for human resource departments, it leaves prospective employers lacking in critical information about job performance, strengths, weaknesses, and other valuable feedback on a potential employee.

After verifying the dates of employment and whatever information is obtainable, the employer should call the job references the applicant supplied. Given the nature of employment verification today, ask the applicant to provide the names and contact numbers for co-workers and supervisors that can verify their previous work experience. Applicants should generously provide you with this information. If they don't, this should be a red flag. You should also assume that the applicant will give you the names of people they assume will give them a favorable reference.

In checking these references, the employer should take the time to verify any information the applicant provided about their experience during the interview. Also be sure to ask for the names of additional supervisors or employees they interacted with regularly. Also ask these individuals for the names of any people who might have had difficulty working with the applicant or gave them unfavorable performance reviews. These people can potentially provide you information from a differing viewpoint. Looking at all of the information provided will give the employer a comprehensive view of the applicants previous work history.

The reality is that in today's ever-changing job market, most positions require less direct technical skills and thus the personality of the applicant and how they fit in as part of a team become of paramount importance, thus making the employment verification section of a background investigation of vital importance.

"When adding a new team member, I feel compelled and obligated to ensure the new associate will not only add value, but do so with integrity," said Andrea Cahill, a senior manager in the logistics industry with years of experience hiring new employees. "(Background checks) are the foundation on which a relationship of trust and confidence between the associate and employer are built."

Education references should also be checked on each applicant to verify that they are being forthright about their credentials. This is one of the areas widely ignored by employers, however it is one of the areas where applicants frequently provide fraudulent information because they know that many employers fail to verify the information. Applicants may have listed a degree they haven't obtained or an inaccurate grade point average. Any dishonesty that develops raises a red flag and shows that the applicant is providing deceptive information about their qualifications for the job. While there may be some possibility to overcome errors in their application, if an employer covers these items during the interview and finds they are still lying then they will not be a good fit for the position.

Many employers still neglect to even conduct a criminal records check of any kind. Unknowingly, they will hire registered sex offenders and criminals with convictions for a wide range of offenses that involve dishonesty, violence, drugs, alcohol or theft. Just because someone previously committed a crime, doesn't necessarily make them unemployable. Instead, the employer should be aware of the past criminal history for any prospective employee so they can discuss the circumstances surrounding it with them and make a decision based on the conversation.

For example, a prospective employee may have a past conviction for Driving While Intoxicated, which occurred ten years before the applicant applied for employment. If the job description shows that the employee would regularly drive company vehicles, then perhaps this can't be overcome. If the job doesn't require driving and the applicant is honest about the incident and explains they completed substance abuse counseling or no longer consumes alcohol, then perhaps it can be overcome.

The same principles can be applied to the applicant's driving history. Just because an applicant previously had their license suspended doesn't necessarily mean they can't be hired. Just knowing the information and determining the honesty of the applicant's response to the information will help determine their fit for the organization. Employers that do regularly have employees drive shuttles or other company vehicles should also check the status of their employee's driving records at least once a year.

Recently, an investigative company came in to assist an industrial cleaning company with a harassment problem. Many employees drive the company's work trucks on a daily basis. Through the course of the investigation, it was determined that a number of the employees were driving company vehicles on suspended licenses. The company ran driving records for all new hires and then never bothered to update the information on a regular basis. This led to a huge liability issue for the company, which could have been solved with an inexpensive driving record examination every year or every six months.

"When I approached the employer and told them that I had evidence showing numerous employees regularly drive company vehicles on suspended drivers licenses, the employer was totally shocked to say the least," said Bauer. "They now understand and appreciate the value of regular drivers license checks on current employees."

At this point, it may seem like this type of research is ideal to obtain, but in reality not cost effective or too time consuming to actually accomplish. It clearly takes a commitment of time and money to produce a thorough background investigation, but outside vendors can make the process easier. Using a reputable vendor to provide comprehensive background investigations can free your hiring team up to remain productive in other areas. It also allows you to put to use the resources of a company with the experience and training to provide a thorough background investigation. Just be sure to ask lots of questions when screening a potential vendor for investigative services. Ask for samples of their work and check on their references.

The biggest thing to remember when using an outside vendor is that cheaper is never better when it comes to background checks so don't select a vendor based solely on pricing. You're getting ready to invest thousands of dollars into a new employee through training, salary, benefits, and retention efforts. The last thing you want to do is spend fifty dollars for a background check that doesn't thoroughly examine anything.

"Background investigations help to protect and ensure the safety and well being of other associates, customers, suppliers, and visitors," said Cahill. "Pre-employment screening including background checks helps me rest comfortably that the best interest of the organization, its assets, and our associates have been considered."

Making the commitment to conduct thorough background checks will, in the end, lead to better employees working for the company. This will save on liability exposure, increase retention, improve morale, increase productivity, and will ensure that the customer has an optimal experience. This will in turn lead to repeat business and increased revenues.

Brian Herbert is the Director of Corporate Investigations for Phenix Investigations, Inc. Phenix is the recognized leader is corporate investigations as they work to assist companies large and small deal with a wide range of issues. Within his role at the company, Mr. Herbert works to manage the corporate investigations division of the company. Typical investigations he coordinates include fraud, theft, non-compete agreements, FMLA, Worker's Compensation, substance abuse, accidents in the workplace and other employee-related issues. Mr. Herbert can be contacted at 800-980-9056 or bherbert@phenixinvestigations.com Extended Bio...

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