“Trust, but verify.” —Ronald Reagan
Pre-Employment Screenings. What you don’t know can hurt you. A 2010 study conducted by the Society for Human Resource Management indicated that 50% of all resumes and applications contain false information. Because it is nearly impossible to differentiate valid information from false information simply from an applicant’s resume, background screenings are an invaluable step in the hiring process.
Many companies, most commonly smaller employers, may overlook background screenings when considering potential hires. This is oftentimes due to cost or simply because they do not feel these checks are necessary. However, a simple cost comparison could shed some light on an issue that may ultimately cost your company thousands of dollars in damage.
On average, according to personalfinance.com, a nationwide criminal background check costs anywhere from $25-$50. State-based criminal checks are less expensive, ranging from $10-20. Most criminal background checks include basic information about a person’s criminal history such as felonies, misdemeanors, arrest dates, sex offender status, and any aliases or maiden names. The FBI can even provide a copy of any individual’s Identification Record, commonly referred to as a “RAP Sheet,” for $18. The FBI record includes a tenprint fingerprint submission as well. Some companies offer expert-assisted checks that can delve deeper into a person’s history, targeting his/her personal, financial, and business history, for a higher price. There are a multitude of other screenings such as social security/name trace, credit report, motor vehicle records, military service verification, civil court records, education confirmation, credentials and licenses, and drug tests and alcohol screening. Perhaps the most easily and inexpensively obtained screenings are employment verifications and personal reference checks. These verifications cost virtually nothing, take mere minutes to collect and can illuminate a fair amount about an employee including work ethic, performance and his/her ability to work with others under stress.
Tallying the costs of background screenings for each potential candidate may seem excessive. But when employers compare these expenses with the probable costs of negligent hiring, the benefits far outweigh the costs. For example, the U.S. Department of Commerce identifies employee theft as the cause of 33% of all business failures. The Department of Justice claims workplace violence accounts for 18% of all violent crimes. Sixty six percent of negligent hiring trial cases result in jury awards averaging $600,000 in damages. Utilizing background screenings is a comparably inexpensive way to fortify your company’s risk management system and avoid costly personnel issues.
But which type of background check is right for your company? Each type of background check can provide useful information—the type of background check your company uses depends on the type of positions that need to be filled. For example, conducting a criminal background check to expose any “theft” convictions would be helpful if your company is looking to hire an Accountant.
An important piece of information to keep in mind as your company conducts background checks: You must always obtain an applicant’s written authorization prior to conducting a background check. There are standard forms to obtain this authorization.
If your company chooses not to complete pre-employment background checks, it is important to realize the associated risks. Can your company afford to skip this inexpensive step in the hiring process?