When hiring employee, reference and background inquiries allow an
employer to verify information provided by the
applicant. Companies who make proper and judicious use
of the information gathered as a result of a thorough
background investigation typically reduce exposure to
employee fraud, theft, embezzlement, turnover,
unqualified employees, negligent hiring claims and
violence in the workplace.
The following are the most important aspects that
makeup a background investigation. Additionally, how the
information can be used to significantly reduce employee
difficulties and employment litigation is also
discussed:
EMPLOYER REFERENCES-
Checking past employers is used primarily to verify
information provided by the applicant on resumes and
applications such as dates of employment, job title,
compensation, reasons for separation, and re-hire
status. With even a small amount of information provided
by a past or current employer, you may be able to gauge
an applicant’s skill, ability and honesty or perhaps
areas such as attendance problems, violent behavior, and
manageability.
· Required element in the defense of negligent hiring
claims (regardless of whether or not the reference
shares information).
EDUCATION VERIFICATION-
An important integrity check. Surveys suggest that as
many as 1 in 3 resumes and applications contain
inaccurate education assertions and that more than
500,000 Americans have bought their academic degrees.
This area contains the second highest rate of
inaccuracy, behind salary. This check verifies education
commiserate with position requirements.
· This is one of the easiest checks to pursue.
· This may include industry specific certifications
and other non-degree-oriented training.
PERSONAL AND PROFESSIONAL REFERENCES-
Similar to screening employer references and great for
gaining an insight into some personality traits of the
applicant.
· Addresses of friends and family that are in other
states, or are otherwise a great distance away, may also
indicate that the candidate had lived in that area. This
is important regarding criminal record checks.
DEPARTMENT OF MOTOR VEHICLE REPORTS-
May verify the type, status, validity, and restrictions
of the applicant’s driver’s license. Can also be used to
verify information provided by the candidate such as
current address, date of birth and license endorsements.
· Essential if the applicant will drive on company
time or use company vehicles.
· May indicate a history of substance abuse.
· Required element in the defense of negligent hiring
claims.
SOCIAL SECURITY NUMBER TRACE-
A specialized report that may indicate a social security
number’s validity or uncover aliases and other people
using the same number. Generally includes a candidate’s
current and previously reported addresses for comparison
to an application.
· Previous addresses should be used in the criminal
history check.
· Required element in defense of negligent hiring
claims.
CRIMINAL BACKGROUND CHECKS-
Make a thorough criminal background check. It is not
uncommon for employers to be sued for an employee’s
illegal acts. Do not check arrest histories, only
records of criminal convictions. Compare to application
to determine a candidate’s honesty. You should not
immediately disqualify a candidate for convictions,
unless they are not included on the application.
Convictions must recent and job related (i.e. driver
applicant with a DWI conviction or a retail candidate
convicted of shoplifting or theft).
The criminal background check is essential in
considering a candidate’s character, integrity, history
of violent behavior, and suitability for the job. It is
best to visit the appropriate county’s Clerk of Court
criminal records office in person but you can also reach
them by phone, fax, computer or mail.
· Past performance is indicative of future results.
· Required element in the defense of negligent hiring
claims.
· If you should find information that causes you not
to hire an individual, keep a copy for your records.
PRE-EMPLOYMENT CREDIT CHECK-
Also called a PEER report by credit reporting bureaus.
This report is similar to a standard consumer credit
report. It may contain secured and unsecured loan,
revolving credit (credit card) and other debt
information, as well as payment history. It may include
information from public record sources such as
judgments, liens, and bankruptcies.
· Used to gauge a candidate’s fiscal responsibility
and financial pressures.
· May also include information from the less
expensive Social Security Trace.
FEDERAL AND STATE LICENSE VERIFICATION-
Used when an applicant must have a license for the job.
Verifies the validity, type and status of required
licensing.
· Complaints and administrative actions regarding
licensed individuals may also be available.
· Required element in the defense of negligent hiring
claims.
HONESTY, ATTITUDE AND PERSONALITY TESTING-
Although not a background or reference investigation,
these tests have a definite place in the pre-hire
process. These surveys measure a candidate’s attitude
regarding honesty, ethics, substance abuse, reliability,
work and supervisors.
· These test typically cost between $6-$10 per
candidate.
· Over 45% of Fortune 100 Companies use profile
testing at some level in their organization.
DRUG SCREENING-
Again, tests for the use of illicit drug use also have a
definite place in the pre-hire process. Many studies
have linked drug use in the workplace to higher than
average losses. According to one such study, the average
theft incident per employee with a substance addiction
is 6.3 times higher than to the average theft incident
committed by a non-addicted employee. OSHA has recently
re-released information indicating that employees in
companies with drug screening programs are 4 times less
likely to have job related accidents, equating to
greater productivity and profits.
· Required element in the defense of negligent hiring
claims (especially when employees operate machinery,
drive on company time or use company vehicles).
Keep in mind, the results from these reports must be
compared against provided information in order to
measure an applicant’s honesty. Hiring a dishonest
candidate is never a good decision.
There are many more sources for background and
reference investigations than have been included here; a
licensed private investigation agency specializing in
pre-employment investigations may be able to help you
identify and obtain any additional needs.
As in all aspects of the hiring process, federal and
state laws may govern how you use or share information
obtained while conducting these and other checks; always
maintain documentation generated as a result of these
reports.
Furthermore, all positions do not require every check
or screening process included; for example, a waiter’s
position in a restaurant may not warrant the expense of
a credit check, motor vehicle report or psychological
profile testing.
Some Important Considerations:
· All employers should seriously consider a
comprehensive drug-screening program.
· Any time a state or federal license is required for
the position, a license verification check must be
completed.
· Background investigations for jobs requiring access
to cash, financial records, and valuable merchandise
(jewelry, weapons, electronics, etc.) should include a
pre-employment credit check, with check-ups performed
semi-annually.
· Department of Motor Vehicle Records should be
checked semi-annually.
· Criminal Background checks should be completed once
a year.
· Additional investigation components should be
verified when an employee is promoted.
There are many other checks and resources available
to the public that can be used to uncover possible
sources of fraud, theft, and dishonesty. The components
listed above are the most common elements of a
background investigation and are not meant to be an
exhaustive study. The services of a competent
investigations company should be sought to discuss
additional options.
L. Scott Harrell is the author of Truth or
Consequences: Hiring for Integrity, a manual which
completely and accurately describes proven
pre-employment hiring strategies and interviewing skills
developed from 14 years of experience as a private
investigator and principal of CompassPoint
Investigations.
More information regarding Hiring for Integrity and
other effective hiring practices can be found via his
website:
http://www.HiringProfessionals.com
