Avoid Risk
Legal action against employers for negligent hiring is becoming increasingly common. The average award in a workplace violence lawsuit now exceeds $1 million per case, according to the Workplace Violence Research Institute. Properly screening employees demonstrates due diligence in the hiring process thereby giving employers a level of protection against litigation.

Improve the Quality of Your Candidate Pool
A formal employment screening program discourages applicants with something to hide and encourages honesty in the application and interview process. Screening not only discourages undesirable applicants from applying, but also attracts qualified applicants who want to work for an employer that cares about the safety and quality of its workforce.

Save Time and Money
An enormous amount of time and money is wasted on applicants that do not meet an employer’s hiring criteria. In a 2001 pre-employment screening survey conducted by Venturi Staffing Partners, employers were asked if any fully qualified potential candidates have declined to continue the hiring process once they were made aware of their pre-employment screening program. Eighty-two percent responded, "No.” Eighteen percent responded, "Yes.” Of the eighteen percent of candidates that declined to continue the hiring process, employers were asked what reasons, if any, did they provide for their refusal to further participate. Fifty-five percent of the applicants stated they knew they would not succeed. Thirty seven percent never called back or were a no show and nine percent, for whatever reason, did not want to participate. Employment screening can filter out unwanted applicants before time and money are spent.

Make More Confident Hiring Decisions
There can be a great deal of uncertainty when selecting a candidate. The Society of Human Resource Management conducted a reference checking survey that revealed applicants regularly or sometimes falsified the following information*:

Employment screening is an effective tool for verifying data provided by the applicant and uncovering omitted information.

Reduce Internal Theft and Protect Assets
Many problems facing employers today result from a lack of employee integrity. According to the American Management Association and the U.S. Chamber of Commerce, thirty percent of all business failures are due to employee theft and other forms of dishonesty. This fraud may take the form of padded expenses, vendor kickbacks, theft of equipment, cash skimming, preparing false financial statements, pilfering merchandise, unauthorized purchases and fraudulent billing practices. The most basic step in preventing employee theft and fraud is not hiring candidates who have committed such acts elsewhere.


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What is the liability associated with not screening employees?
Negligent hiring is a legal theory under which employers can be held liable for the unlawful or improper actions of their employees if it can be shown that they failed to make "reasonable” inquiries into the employee’s background and suitability for the position. Most negligent hiring lawsuits maintain that the employer failed to conduct appropriate research, such as a criminal record history, employment verification and other background information, that would have disclosed the employee’s past misconduct, and that, therefore, the employer was negligent for putting a person with criminal or other inappropriate tendencies, in a position where they could pose a threat to coworkers, customers or members of the general public.
Under the theory of negligent hiring, if the employer knew, or should have known, of the risk presented by the employee, the employer can be held liable. Employers found negligent in the hiring process have been subject to substantial financial penalties including both actual and punitive damages, which are now reaching an average of one million dollars.

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What services should we include in our employment screening program?
A company’s objectives determine what an employer will want to include in a background check. Employers only concerned with avoiding liability would conduct a minimal search that would be considered a "reasonable” inquiry by our judicial system, thus protecting the company should a negligent hiring lawsuit arise. Since the law has not defined "reasonable,” an employer doing a minimal search is likely protected from a negligent hiring claim. Clarifacts recommends this minimal search include a social security number verification and criminal record search.

If the employer has goals beyond liability protection, such as the safety, integrity and capabilities of its employees, the screening process will be more extensive. Therefore, when determining what to include in the background check, employers must look at the various positions within their organization and request such services based on the job classification. For example, in addition to a social security number verification and criminal record search, which is recommended for all positions, requesting a credit history report for a staff accountant position or driving record history for a delivery driver position would be both appropriate and highly recommended. Clarifacts can assist employers in developing an employment screening program to meet their specific hiring needs.


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Can employment screening be considered discriminatory?
The most important aspect of any employment screening program is consistency. Employers with a written policy who are conducting background checks uniformly within job classifications will be able to refute most claims of discrimination. Employers may also face claims of discrimination when using the information obtained from a background check. Therefore, employers should have job related standards in place on what negative information will and will not preclude an applicant from employment. Again, these standards must be followed consistently.

In addition, employers must be aware of the guidelines the Equal Employment Opportunity Commission (EEOC) has mandated for the use of criminal records. The EEOC and other state legislation restrict the use of background information by an employer. Under EEOC guidelines, an employer may not automatically disqualify an applicant with a criminal record. The employer must take into consideration several factors before making the final hiring decision. Not taking these factors into consideration may result in a claim of discrimination and EEOC scrutiny.

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* Statistical data gathered from the following sources: American Management Association, Employment Management Association, Occupational Safety and Health Administration, US Chamber of Commerce, US Department of Labor, Workplace Violence Research Institute.