Small business owners know the value of good employees. But unlike large corporations, smaller businesses are often unable to absorb the risks and liability that may come from bad hiring decisions. In this article, Traci Canning, Managing Director, Kroll Background Worldwide will be offering guidance on carrying out employee checks.
More and more, employers feel the need to know about the background of prospective, even current, employees and for small business owners the question of how to find the best employees without violating privacy rights and other laws can be confusing. More importantly in today’s business world it is ever more important to protect your company from financial, reputational and security risk. In this article, Traci Canning, Managing Director, Kroll Background Worldwide will be offering guidance on carrying out employee checks.
Most organisations recognise that good employees are an essential component of building a strong reputation, something which can take years to achieve. However this reputation, and the trust customers place in it, can be surprisingly fragile and could be damaged beyond repair by unqualified or unsuitable staff. This is highlighted following recent news that more than 400 police officers and staff of the British Police forces who were disciplined or dismissed for unethical behaviour and accessing confidential police information.
Security breaches, media attention, negative public opinion, fines, and a reduction in revenue through reduced business can all occur as a result of an incident of unethical behaviour by staff. With the increase of peer to peer review sites on the internet, bad press does not go away as quickly as it used to and the consequences of this may have a direct negative effect on your company. So, how can SME businesses reduce the risks of a bad hiring decision and have confidence that they are recruiting honest reliable individuals and not exposing their company to unnecessary risk? For some business owners the question of how to find the best employees without violating privacy rights and other laws can be confusing.
It would certainly be naive for employers to take today’s job applicant’s CVs at face value. People are prepared to go to a lot of effort to get a job, particularly at a time of economic uncertainty when positions are scarce and a rash of redundancies mean that qualified candidates have swamped the market.
Candidate’s creativity on their CVs can be incredible. Whilst some may embellish qualifications believing it will give them the edge on other candidates, others will entirely fabricate employment history to attempt to cover up things like dismissal for gross misconduct or even jail terms. These embellishments are fraudulent acts and can have severe consequences. Last year an NHS executive was given a three month jail sentence for lying on his CV. Most CV cheating, however, is less complicated exaggeration, such as upgrading a degree or overstating a former salary. Some candidates are also inflating their professional responsibilities by taking advantage of many companies’ unwillingness to provide references that give anything more than dates of employment and a job title.
One of the simplest steps a company can take to help them understand their candidates, and be aware of any potential risks they could pose, is pre-employment background screening – a process of thoroughly checking CVs and verifying a candidate’s suitability. For example, a credit check will flag up whether someone being considered for a financially influential role at work has problems managing money at home.
Pre-employment screening, if carried out diligently, can provide an effective barrier to fraudsters joining your company. A basic level of screening should be carried out on all new employees. More detailed screening should be carried out on candidates applying for sensitive roles. This should include screening not just new employees but existing employees moving into sensitive areas.
A clear policy of consensual pre-employment screening should act as a strong deterrent to those trying to cover up something sinister and reduce the number of people who misrepresent themselves. You are making a clear statement that dishonesty will not be tolerated. However, incredibly many people still lie, arrogantly believing employers won’t actually go as far as checking the facts.
Conducted in the right way, background screening for employment purpose is an entirely legal and recommended practice. With an increasingly multinational workforce, checking a CV and verifying a candidate’s suitability is not straight forward as you have to contend with international time differences, language barriers and variations in what both legal and culturally acceptable from country to country.
To be of credible use to an employer, the background screening needs to be carried out in the right way. Swamped with information available on the internet, employers are increasingly relying on social network sites to supposedly “screen” candidates, but as the content is generated by the candidates themselves, with no independent verification, it could well be riddled with the same lies as appear on their CV. It is also very easy to set up social media profiles under other people’s names so the content may not have been authored by the person you think it has.
Documentary evidence is not always trustworthy. Online “universities” that sell degrees for a few hundred pounds usually include legitimate-looking diplomas and a telephone verification service where someone will confirm that the candidate does indeed have a degree from them. And candidates can use stolen letterheads or willing accomplices to provide written or verbal references. Simply seeing a certificate or ringing up is not enough.
Whilst background screening will give an employer an indication of a candidate’s circumstances at the time of hire, their situation may change overtime and they could later come to pose a threat to the organisation. Therefore, for optimum risk protection, regular re-screening should be undertaken for things where data may vary over time, namely criminal record checking and searches for adverse financial records. Policies of regular re-screens should be set out in an individual’s employment contract.
Whilst many organisations may already undertake background screening for their most senior recruits, few have a policy that extends across their entire workforce. Often the lowest level staff poses the highest risk to companies, but because they’re coming in at a lower level, it’s not seen as cost-effective to do comprehensive checks, which would be standard for a director on a six-figure salary. Yet the risk is the same if not worse as these individuals may have the same access to financial information, valuable stock or customer data and lower levels of corporate loyalty.
Employers should also consider the screening of contractors and temporary staff. Such staff may only be employed briefly, but they present a significant risk to businesses who through necessity allow them access to high risk areas such as payroll and IT systems. Many of the largest and best companies are screening now and SME’s are recognising that it is cost effective to use third parties or even in-house screening practices to prevent bad hires. SMEs are starting to realise that screening costs are no where close to what it costs to engage an executive recruitment firm who work with firms to develop job profiles and source and interview prospective candidates. Pre-employment screening begins when the final candidate or candidates are selected.
Traci Canning is Managing Director, Kroll Background Worldwide.
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