For employers, a Pre-Employment Background Check has become a matter of necessity. Too many applicants make false claims on their job applications and resumes or attempt to cover up prior criminal activity. About 40% of the background checks processed by Peak Investigations turn up at least one serious discrepancy.
Increase Applicant and New Hire Quality
The first benefit of background checks that most clients see is an increase in applicant quality. We often hear from our new customers that they saw an almost immediate improvement in the quality of applicants once the word got out that they were conducting thorough background checks. A complete employee screening process:
- Results in fewer applications with serious discrepancies
- Discourages applicants who are trying to hide something
- Increases applications from applicants who want to work in a safe environment
- Increases the quality of new hires due to an improved applicant pool and improved selection process
According to a survey conducted by the US Dept of Justice, 1.75 million days of work are lost each year by victims of workplace violence. The cost in lost wages account for about $55 million per year. When less direct, but further-reaching costs are considered, such as lost productivity, legal expenses, and diminished public image, the annual cost of workplace violence could measure in the billions.
An Employer’s Imperative
Employers have a moral and legal obligation to provide a safe work environment. Therefore, knowing whether a potential employee has been involved in criminal activity (such as drug or other substance abuse, reckless behavior, dishonesty, theft, or dangerous and violent behaviors) allows the employer to determine if an applicant is appropriate for the job and work environment. It also helps the employer determine if the applicant poses a potential threat to other employees.
Prior history is a good predictor of future performance. Background checks are used by employers to identify applicants prone to unacceptable workplace behavior. Background check tools such as Criminal Record Checks, Prior Employment Verification’s, Education Verification, License Verification’s, and other research tools can reveal potential problem areas.
Negligent hiring liability holds employers responsible both for what they do know and what they should have known about their employees. It can even hold employers responsible for employees’ actions off the job. Courts have repeatedly affirmed that employers have a duty to exercise reasonable care in hiring individuals who, because of the nature of their employment, may pose a threat to the public.
How Do Background Checks Help?
Because employers have a moral and legal obligation to provide a safe work environment, knowing whether a potential employee has been involved in criminal or dishonest activity (such as drug or other substance abuse, reckless behavior, theft, or dangerous and violent behaviors) allows the employer to better determine if an applicant is appropriate for the job and work environment. Background Checks allow an employer to better determine if an applicant poses a potential threat to other employees or customers.
Background check tools such as Criminal Record Checks, Prior Employment Verification’s, Education Verification, License Verification’s, and other research tools can reveal potential problem areas and provide documentation that an employer has taken “reasonable care” in the hiring process. Thorough background check documentation is an important element in reducing negligent hiring liability.
NOTE: If Your Employees:
- Access consumers’ financial, medical, or personal information
- Access consumers’ living quarters or residences
- Work with the infirm, the elderly, or children
- Work with hazardous materials
- Are responsible for the safety of themselves and others
You are generally expected by the public, the law, and the courts to be extra-vigilant when screening employees.
The typical organization loses 5% of its annual revenue to occupational fraud. The median loss caused by occupational fraud was $140,000. More than one-fifth of fraud cases caused losses of at least $1 million. Small organizations are disproportionately victimized by occupational fraud. Employee theft and dishonesty can also reduce production, damage public confidence, destroy employer reputation, and negatively affect employee morale.
Prevalence of Employee Dishonesty
Theft and fraud is something of which employers are aware but perhaps a bit complacent. The true prevalence of these crimes is pervasive and not well known. Approximately 30% of employees admit to stealing from their employers. The perpetrators are not those one would expect: 41.2% are managers, 39% are employees, and 19.3% are owners or executives.
How Can Background Checks Help?
Prior history is a good predictor of future performance. Background checks are used by employers to verify the freely volunteered information provided by applicants (usually through a resume or job application). Background check tools such as Criminal Record Checks, Prior Employment Verifications, Education Verification, License Verification’s, Drug Screening and other research tools can reveal potential problem areas. Through careful and wise use of the information obtained in complete background checks, employers greatly reduce or eliminate the risk of employee dishonesty losses by avoiding individuals who exaggerate or falsify credentials on resumes and job applications and reduce drug-related theft by encouraging a drug-free work environment.
Employers whose employees have access to residences and living quarters have a moral and legal obligation to ensure a safe environment for consumers. Knowing whether a potential employee has been involved in criminal or other inappropriate activity (such as drug or other substance abuse, reckless behavior, dishonesty, theft, or dangerous and violent behavior) allows the employer to determine if an applicant is suitable for this type of work environment. Apartment owners, property management firms, and maintenance and custodial companies are just a few of the employers that face potentially costly problems caused by dishonest and criminal behavior of employees who have access to residences and living quarters.
How Do Background Checks Help?
All employees (including temps, part-time workers, contractors and volunteers) who have access to consumer residences or living quarters should be backgrounded. A background check, or application verification, verifies the information provided by the candidate using independent sources such as criminal and civil court records, prior employer records, educational institution records, and credit or motor vehicle reports.
While it may seem unfair, the courts have repeatedly found employers responsible for the criminal actions of employees on the job, and, in some cases, off the job. The average award in security (personal safety) negligent hiring cases is more than $1 million. Essentially, the courts see a background check as cheap insurance against repeated criminal actions.
Pre-Employment Background Checks help screen in employees who stay longer because employers are able to make the “Right Hire” the first time. Employers are able to hire the right people by increasing the accurate and objective information available to hiring managers. The information provided by a comprehensive background check enables employers to build a competent workforce and reduce the likelihood of hiring dishonest employees and employees with drug and alcohol problems. Gathering information from multiple sources provides a clearer understanding of the applicant’s qualifications and reduces an employer’s risks.
Bad Hires are Expensive
According to a survey conducted by Right Management Consultants, the replacement cost of a bad hire is 1 to 5 times the salary of the job in question. Consider the direct and indirect cost of recruiting and hiring, the direct and indirect cost of training, and the wasted wages and benefits. Also consider the management, administrative, and legal costs of a bad hire, plus the direct and indirect cost of damaged or stolen funds, materials, equipment, work environment, customer goodwill, and employer reputation. Verifying applicant claims helps the employer make the right hire the first time and is clearly worth the investment in a thorough background check.
A Thorough Background Check Increases the Objective Information Available to a Prospective Employer
Employers have a moral and legal obligation to provide a competent workforce and a safe work environment. An employer can determine if a potential employee is appropriate for the job and work environment by learning whether the applicant has the experience, education, and training required to succeed at the job.
A large number of applicants make false claims. Therefore, Criminal Record Checks, Prior Employment Verification’s, Education Verification’s, License Verification’s and other Research Tools are valuable honesty checks. These employment background check tools help employers develop a more accurate and complete picture of an applicant and can reveal potential discipline problems. For more information about what can be in a thorough background check, see Comprehensive Background Check: The Best Background Check.
Negative Publicity can Destroy an Employer’s Reputation
Bad publicity caused by an errant employee or volunteer can severely damage an organization’s reputation with its funding sources, its constituency, and the public. This negative impact on funding and reputation can cripple an organization to the point of closure.
How Do Background Checks Help?
Prior history is a good predictor of future performance. Background checks are used by employers to verify the freely volunteered information provided by applicants (usually through a resume or job application). Because of the large number of applicants who make false claims, Criminal Record Checks, Prior Employment Verifications, Education Verification, License Verification’s, and other research tools can reveal potential problem areas. Through careful and wise use of the information obtained in proper background checks, employers greatly reduce the risk of negative publicity.
In many cases there is little difference in the eyes of the public or the law between employees and volunteers who perform essential functions of an organization. Volunteers should be screened just as carefully as employees who would be performing similar roles. The public, courts, and regulatory agencies expect extra vigilance during the selection process of those who will be dealing with the infirm, the elderly, and children, as well as those who will have access to living quarters or residences. Such staff should be carefully screened. Proper background checks greatly reduce the likelihood of hiring a bad employee or volunteer, and thus they reduce the likelihood of negative publicity.
- Reduce the high cost of turnover by screening in employees who stay longer.
- Reduce losses from employee theft, employee fraud, drug and alcohol abuse, absenteeism, workplace violence, and litigation.
- Avoid wasted benefits.
- Reduce training and employee development costs.
- Increase productivity through hiring employees with better work habits, attitudes, policies, and practices.
- Enhance professionalism by “screening in” appropriate workplace attitudes.
- Decrease insurance costs. Some insurance companies will give background check or drug-screening discounts to firms who take such precautions.
- Meet regulatory, insurance, and customer requirements.
Employers who conduct careful background checks are usually better organizations to work for. They…
- Are better managed
- Place greater value on employees
- Provide a safe workplace
- Are willing to invest in quality employees
For more information call 602-341-3703 for a free consultation.
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