Aug 14, 2013

Should You Conduct a Pre-employment Background Check?

When hiring a new employee, you probably already call work references to make sure the candidate isn’t a drama-filled, insubordinate nightmare who you’ll soon wish never applied for the job. However, deeper reviews known as Fair Credit Reporting Act background checks or consumer reports show glimpses of the most intimate details of a prospective employee’s life. Beyond credit and criminal reports, background check companies offer the opportunity to review school records, medical records, and interview family and friends. More than half of human resource professionals report finding inconsistencies between the information provided by employees and items uncovered through record checks, reports the Society for Human Resource Management. The most common checks turning up inconsistencies were those investigating criminal and driving records. Misrepresenting certifications and licenses ranked the third most common area for discrepancy. With such rampant misrepresentation, employers might find a heightened screening useful. Some companies appreciate the opportunity to make informed decisions about personnel — each new hire, after all, is an investment of time and money. Hires that don’t work out could cost you. However, these reports, and how people use the information they yield, lie in a legal grey area courts are still sorting out. Is a third-party, pre-employment background check right for you? Pros:

Develop a comprehensive view of your prospective hire’s personality to help gauge if he will fit into the office. During the hiring process, everybody’s on their best behavior. Consumer reports allow you to dig deeper and see what the prospective employee is truly like through interviews with family and friends.
Gain access to your prospective employees’ driving records. This could be important if the employee will frequently drive a company car and you don’t want to hire someone with a record of speeding tickets and reckless driving.
Learn if the employee falsified or misstated information ranging from professional degrees to previous job titles to salary history. Not only would this let you know if a job candidate said he went to Harvard and actually went to a local community college, but this sheds light on personality quirks that you may or may not want to bring into your office.
Keep other employees safe. Learning your hire has an unsavory past, including sexual misconduct or assault convictions, could keep your existing staff safe and protect your company from related liability.

Cons:

Liability. If you don’t follow all the necessary disclosures, you could open yourself up for lawsuits. Also, not all unflattering information is legally sufficient for not hiring the employee. All adverse decisions must be documented, and the employee has the right to know why he was not hired. If the employee feels he was unfairly discriminated against, he could sue. Whether or not he wins, court costs can quickly become expensive.
Inaccurate information. Sometimes data turned up by these reports is inaccurate. Although employees have the right to dispute erroneous information, sometimes the harm is already done.
Time. Thorough checks can be time consuming. In a competitive job market, highly qualified employees might accept another job while you’re still waiting for the background check results to return.
Risk alienating promising employees. Just because you can unearth this sensitive information doesn’t mean you should. Some talented employees may have privacy rights concerns, and digging too deep into their personal lives may convince them to move on.