Don't Hire Without a Background Check

By Barbara Weltman on 15 April 2011 (Updated 9 May 2011) 0 comments
Photo: Scukrov

The recent federal unemployment report shows that more companies are now hiring. If you are in the market for a new employee, make sure that you take certain actions before you finalize a job offer. Hasty hiring can result in employing someone who turns out to be an unqualified worker or, even worse, can lead to lawsuits and other costly headaches.

Take Nothing for Granted

Job applicants lie. At least that’s what the ADP’s 2009 Hiring Index revealed from 1.7 million background checks performed. Forty-six percent of applicants had discrepancies in their employment, education, and/or credential reference checks. Thirty-seven percent of applicants’ driving records had one or more violations or convictions, and six percent had a criminal record within the last seven years.

Don’t take anything at face value, regardless of the job level or the applicant’s demeanor. You may recall that Don Edmondson, the CEO of Radio Shack, Ronald Zarrella, CEO of Bausch & Lomb, and Marilee Jones, the admissions dean at MIT, were all forced to resign their positions when it was discovered that their degree claims were bogus. Even if applicants don’t fabricate their claims, they often exaggerate; this is called “resume padding.” They may claim responsibility for managing more people than they actually oversaw, or they may say their efforts were the primary reason for sales growth. Some may omit key information, such as clues about their age or a job firing, to portray themselves in a better light.

Determine the Scope of the Background Check

How thorough a background check do you need to do? It depends on the job. For example, for anyone who will be driving a company vehicle or driving for company business, a check of the applicant's driving record is essential. It is now known that the driver of the tour bus that crashed in March 2011, killing 15 people, had been ticketed in 1995 for speeding and twice for driving without a license. Liability for “wrongful hiring” will likely be placed with the bus company.

It is becoming increasingly common for employers to do credit checks on applicants, on the belief that a solid credit history evidences a responsible person. Some states, such as Illinois, Oregon, and Washington, allow the use of credit checks only if they are relevant to the applicant’s job. Under the federal Fair Credit Reporting Act (FCRA), in all cases you must obtain an applicant’s permission to run a credit check.

Background checks can include not only education, driving records, and credit history, but also:

  • Criminal records;
  • Medical records;
  • Military records;
  • Past employment;
  • Professional licenses;
  • Sex offender registry;
  • Workers compensation history.

Reference Checks

It’s always a good idea to check an applicant’s references, but be aware that the information you’ll receive likely is limited. Most former employers will only verify the dates of employment, compensation, job title, and other bits of fact. They won’t say how the applicant performed on the job, whether there were any particular problems or issues, and whether they would recommend the person for the pending position. Why? Former employers are afraid of retaliatory lawsuits for giving poor references.

How to Do a Background Check

The first and easiest way to check resume claims is to review an applicant’s personal postings on social media sites. Facebook has become the go-to place for employers to see what applicants say about themselves. If there are any discrepancies with the information on the resume, it may be advisable not to make a job offer, no matter how attractive the applicant had appeared to be.

After determining the scope of the check you want, use a company that can perform the check for you. The cost varies with the scope of the check, but the cost is reasonable compared with the legal exposure you could face if you fail to do the check. Here are some popular resources to help you:

Hiring the wrong person for a job benefits no one. The worker may be unhappy or even be fired. Your company won’t get the work done right and, if you terminate the worker, it could cost you in increased unemployment insurance rates. Or worse, the person can cause injury to your customers, other employees, or the public, leaving you exposed to major lawsuits. Take the time to check things out before you make the job offer.

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