Benefits of background checks: when making critical hiring decisions, make sure you've covered all the bases.

The hiring process, including interviewing and screening applicants, enables employers to create an efficient yet diverse workforce. The more proactive an employer is during these initial employment steps, the greater overall workforce productivity will be and the lower the possibility of future employment litigation.

Most employers provide applicants with standard employment applications, review resumes, and conduct interviews; many even use recruiters and have personnel trained in conducting pre-employment interviews. Unfortunately, many organizations rely on inadequate practices for background screening of potential employees. While many employers feel that they are covered by existing practices, a false sense of security causes them to make common mistakes that can leave them exposed to costly litigation.

Mistake #1: Relying on the applicant.

While an applicant may not outright lie, he or she may omit important information about his or her background. Unless specific, direct questions are asked on the application and in interviews, applicants may feel vague answers or omissions are acceptable. Other candidates are simply desperate enough for a job that they have no ethical misgivings about misrepresenting the truth. Relying on the applicant to provide comprehensive, accurate information may leave you with half-truths or even lies.

Mistake #2: Relying on the recruiter.

Because recruiters perform a number of valuable services, it's easy for a manager to step away from his or her responsibilities in the hiring process and let the recruiter do the work. But, ultimately, recruiters are in the business of placement, not research. While they may perform some vetting activities (such as confirming academic degrees or past employment), recruiters don't offer comprehensive background checks that can insulate your business from potential liability.

Mistake #3: Relying on the consensus of interviewers.

It's common practice to think that a hiring decision can be made when a candidate looks good on paper, interviews well, and is viewed as "a good person" by the interviewing team. While a personality "fit" does matter, remember that every hire is an important decision that could eventually impact your entire operation. The team of interviewers can confirm that the applicant has the appropriate skills and traits for the position, but a comprehensive background check offers a critical "second" to the nomination for the job.

Risks To Employers

The statistics overwhelmingly demonstrate that any organization could be at risk, and case law combined with jury awards support the argument that an employer simply cannot afford to turn a blind eye. Consider these points:

* Research conducted by the Society for Human Resource Management shows that 50 percent of all resumes and applications contain fabrications.

* The U.S. Department of Commerce estimates that employee theft causes 33 percent of all business failures.

* According to Bureau of Justice statistics, workplace violence accounts for 18 percent of all violent crimes.

Furthermore, under the legal doctrine of negligent hiring or retention, an employer has the duty to protect its employees, clients, and the public from injuries caused by employees whom the employer knows or "should have known" pose a risk of harm to others. Likewise, an employer may "be held liable for failing to investigate" or discharge an employee.

Overall, 66 percent of negligent hiring trial cases result in jury awards averaging $600,000 in damages. And, the Workplace Violence Research Institute reports that the average jury award for civil suits on behalf of the injured is $3 million.

Benefits of Employee Screening

Beyond the many negative reasons to screen potential employees, employers with comprehensive background screening programs also reap many benefits:

Better attendance and lower turnover.

Employers who conduct thorough background screening, including reference checking, experience better employee attendance rates and lower turnover. In addition, employers may see reduced healthcare and workers' compensation costs.

While costs associated with healthcare, job-related accidents, and workers' compensation may seem unrelated to background screening, there is a correlation. Hiring the best overall employees makes a difference in terms of attitude, safety, and performance. When a drug-free workplace program is also in place, employers experience even greater cost savings.

Employers should conduct a postconditional job offer workers' compensation search on applicants for jobs that require manual labor, standing for long periods of time, or performing other duties that can lead to stress injuries such as chronic back pain. Unfortunately, fraud associated with workers' compensation claims, especially in regards to back and other chronic pain that is difficult to measure, is well-documented. Employers who search workers' compensation records take an important step toward protecting themselves from professional claimants.

Reduced employee theft.

Overall, employers who conduct background screening experience fewer incidents of employee theft, fraud, embezzlement, and shrinkage. Screening may reveal past theft or other criminal behavior, possibly preventing a bad hire, but also having a solid background screening program sends a message to potential employees. It demonstrates that an employer is concerned about who has access to financial or material assets and that the company will take appropriate action if necessary.

Fewer incidents of litigation.

Background screening enables an employer not to hire a potentially bad employee, reducing the risk of accidents, criminal activity, and violence--all of which may result in litigation. While no screening program can completely eliminate the possibility of a lawsuit, an organization with a comprehensive screening program in place will have documentation to demonstrate that it took reasonable measures to investigate the employee's background pre-hire. Consequently, exposure to a courtroom trial, bad publicity, and hefty penalties is greatly reduced.

Improved productivity.

The more an employer does to evaluate applicants--whether through interviews, reference checks, or background screening--the better its overall workforce will be. And, the stronger the employee pool, the better a group's overall productivity and performance will be.

More qualified employees.

By screening applicants, employers are more likely to find qualified employees for their open positions. Employment, education, and professional verifications, though, are just the beginning when determining whether an applicant will appropriately fit your needs. In addition, protect everyone you employ by checking criminal histories of applicants. The comfort of knowing that your most recent hire does not have a violent past can help build morale among your personnel.

Finally, confirm that an applicant is whom he or she claims. In today's society where identity theft is rife and illegal immigration is a growing concern, employers need to ensure that a potential employee is who they claim. Confirm an applicant's social security number by running a check on whether or not the number is valid. In addition, a critical post-hire check is the I-9 verification, which must be conducted within three days of an employee starting his or her job. This search allows an employer to know whether or not a person can legitimately work in the United States.

Conducting background checks is a practice that employers of all sizes should make standard operating procedure for all new hires. This proactive approach provides employers with comfort in knowing that the risks associated with making bad hiring decisions are limited. Also, other employees can find reassurance in knowing that the person working next to them is less likely to cause harm to other people or the club.

Kristen Turley is director of market development and communications for U.S. Investigations Services. The firm offers employment screening, drug testing, and background investigations in North America. For more information, visit their website at www.usis.com.