Background Check Articles
by Industry Sources

The following articles may be of interest to employers seeking information about background checks and employment screening.

Avoiding Negligent Hiring Lawsuits

HR Management
http://www.hrmreport.com/article/Avoiding-Negligent-Hiring-Lawsuits/
Points of Interest:

Background Checks go a long way in providing for a safe, productive work environment and avoiding litigation as a result of negligent hiring.
The best practice for an accurate, cost-effective criminal background check is to research where your applicants have lived, worked, and gone to school during the last 7 years.
Properly documenting pre-employment background checks does not guarantee you won't be sued, but will drastically reduce the chance of being found guilty of negligence or discrimination.

The ROI of Background Screening

HR Management
http://www.hrmreport.com/article/The-ROI-of-Background-Screening/
Points of Interest:

The net annual Return On Investment for background screening is over 900%. There are scarce few business expenses that can generate the type of ROI that background screening can.
According to the US Small Business Administration, for every dollar an employer invests in employment screening, the return on investment ranges from $5-16, resulting from improved productivity, reduced absenteeism, lower turnover – and decreased employer liability.
The Saratoga Institute estimates the cost of turnover at 150% of annual compensation for salaried workers.
Dr. Bradford Smart suggests that the cost for senior executive turnover is as high as 2,400% in his book Topgrading..
The United States Department of Commerce reports that 30% of all business failures result from theft or embezzlement.

Criminal Background Checks Incomplete: How convicted felons can slip through safety net

MSNBC
http://www.msnbc.msn.com/id/7467732/
Points of Interest:

Spotty participation by the nation's 3,100 county courts, along with a hodgepodge of data formats, make national crime databases vastly incomplete.
The national databases have a 41 percent error rate.
There is only one way to conduct a thorough criminal background check: combine computer-based nationwide searches with old-fashioned in-person visits to county courthouses that house criminal record information.

Executives: Making It by Faking It

Business Week
http://www.businessweek.com/managing/content/oct2007/ca2007104_799274.htm
Points of Interest:

Sixteen percent of executive resumés contain false academic claims and/or material omissions relating to educational experience.
The hiring organization can trust that engaging the services of a professional background-screening consultant will pay off.
A thorough background check is an important insurance policy for the recruiting process.

Do You Really Know Your Contractors? The Hard Evidence for Contractor Screening and Employment Background Check Searches

HRM Guide
http://www.hrmguide.com/recruitment/contractor-screening.htm
Points of Interest:

Contractors are the Achilles heel of a company's supply chain and pose the greatest risk because they have the least oversight.
In a series of landmark decisions, the US court system has held that hiring companies are accountable for actions of employees, contractors, vendors, and suppliers.
Background checks should be run on all contractors.
Perform a criminal and employment background check, credential and/or license verification, immigration status (if applicable), and, for jobs with considerable money responsibilities, a credit history report on every employee that will be dealing with your assets.

Drugs in the Workplace: Fact Sheet

Substance Abuse & Mental Health Services Administration
Division of Workplace Programs
Points of Interest:

77 percent of illicit drug users in the United States are employed.
Problems related to alcohol and drug abuse cost American businesses roughly $81 billion in lost productivity in just one year.
Substance-abusing employees function at about 67% of their capacity.
Up to 40 percent of industrial fatalities and 47 percent of industrial injuries can be linked to alcohol use and alcoholism.
Employees who use drugs are 3.6 times more likely to be involved in a workplace accident and 5 times more likely to file a workers’ compensation claim.
Implement a drug-free workplace program. Even if your organization is not required to have a drug-free workplace program, your organization can still benefit.

10 Ways to Catch a Liar

webmd.com
http://www.webmd.com/balance/features/10-ways-catch-liar
Points of Interest:

Experts share ten tips that can help you know if someone is telling you the whole truth.

The Case for Background Checks

Insurance & Technology
http://www.insurancetech.com/showArticle.jhtml?articleID=197001284
Point of Interest:

Thirty percent of insiders who launch system attacks have criminal records.

Do A Thorough Background Check On Workers -- Or Let The Hirer Beware

Bankrate.com
http://www.bankrate.com/brm/news/biz/Biz_ops/20000515.asp
Points of Interest:

About one-third of résumés have some degree of puffery.
Two-thirds of all job applicants say they have stretched the truth at least once in an effort to land a job.
Bogus college degrees or scholastic honors, or distorted majors and minors are common distortions.
Require all applicants to fill out a formal job application.
Look carefully at all documents. Compare an applicant's résumé to the job application for discrepancies.

Improving Retention

Saratoga Human Resources Services
PwC Publication
Point of Interest:

Turnover-related costs represented more than 12% of pre-tax income for the average company. At the 75th percentile, turnover costs are equivalent to nearly 40% of earnings.

Pre-Employment Screening Gaining Favor

Phoenix Business Journal
http://www.bizjournals.com/phoenix/stories/2005/11/14/smallb1.html
Points of Interest:

Pre-employment screenings are seen as the first step in battling lost productivity or turnover as the result of employees who were hired based on training or experience they claimed to have, but just didn't
Business owners also can use the background checks to reduce the risk of hiring an employee who has a propensity for physically harming a customer or another employee.

Overwhelming Passage of Criminal Background Check Legislation

Michigan Health Care Fraud Division
http://www.michigan.gov/ag/0,1607,7-164--132186--,00.html
Points of Interest:

Almost 10% of the employees caring for seniors and vulnerable adults have criminal backgrounds.
25% of residential care facility employees committing crimes against residents had past criminal convictions.
9% of Certified Nurse’s Aides (CNAs) had outstanding criminal warrants and 3% had past criminal convictions.
At four sample Michigan nursing homes, 9% of employees had outstanding warrants and 11% had past criminal convictions.

Guide To Employment Law, October 2000

Reish & Luftman
http://www.reish.com/publications/pdf/Emplawoct00.pdf
Point of Interest:

Employers lost 60% of negligent hiring/supervision jury trials.

Avoid Sexual Harassment Lawsuits

Office.com
Point of Interest:

The average jury award against employers in sexual harassment lawsuits is about $250,000.

Background Screening – Past, Present and Future

NAPBS, National Association of Professional Background Screeners
http://napbs.i4adev.com/files/public/Consumer_Education/Resources/HistoryBackgroundScreening.pdf
Quotes of Interest:

"Organizations owe it to themselves and to everyone with whom they come into contact to know everything they can about their employees and volunteers, and the most effective method to accomplish this is by conducting thorough background checks."
"Making background checking a part of an organization’s culture can not only enhance its effectiveness (e.g., through greater productivity and retention), but also its reputation."
"Background checking can supplant an organization’s loss prevention efforts by helping provide a safer environment for employees, volunteers, and others."
"The most common reason among employers for not conducting background checks is cost. However, the cost of background checks represents a fraction of the cost of: terminating an individual; re-recruiting, re-hiring, and re-training his or her replacement; and defending a lawsuit brought by a victim of a dishonest or violent individual’s actions (which can range in the multi-millions of dollars)."

Bulletproof Practices

HR Magazine, November 2002
www.shrm.org
Points of Interest:

The annual tab for workplace violence and stress-inducing hostility in the workplace comes to about $13.5 billion in medical costs and 500,000 workers missing 1.75 million days of work.
Background checks are not foolproof. Nonetheless, doing them reduces vulnerability in a negligence claim.
Even if a reference refuses to supply information, the fact that an effort was made helps demonstrate due diligence.

Beyond Pre-Hire Background Checks: Post-Hire Screens Become the Norm

SHRM Staffing Management Library
www.shrm.org
Point of Interest:

Since things can change so quickly, many employers are realizing that post-hire employee background screening should be conducted at regular intervals for certain job categories or employment situations in order to mitigate business risk.

More Background Screening Yields More ‘Red Flags’

SHRM Staffing Management News July 2007
www.shrm.org
Points of Interest:

The percentage of "hits," or red flags, showing up in background checks is increasing as more companies are opting to conduct more complete background checks for larger segments of their job applicant pools and current employees.
More thorough background checks include more complete data. Employers are digging deeper than ever before.
Companies are screening all employees, not just managers. Companies also are increasingly screening temporary employees, vendors and consultants, all of whom could also pose a threat to their business.

Criminal Background Checks for Employment Purposes

SHRM Legal Report July/August 2006
www.shrm.org
Important Point:

The ideal background check is accurate, comprehensive, consistent, timely and, of course, legal. Coordinating these factors is expensive and time-consuming, but getting the best background check possible is too important to let budgetary or time constraints compromise the process.

Criminal Background Checks: A Checklist of the Pros and Cons

SHRM Information Center
www.shrm.org
Points of Interest:

There are significant rewards to doing Criminal Background Checks.
There are significant limitations and restrictions employers need to be aware of when conducting Criminal Background Checks

Not Wanted: Thieves

HR Magazine: Legal Trends
www.shrm.org
Points of Interest:

Employee theft and fraud is pervasive and not well known.
Approximately 30% of employees admit to stealing from their employers.
Of the perpetrators 41.2% are managers, 39% are employees, and 19.3% are owners or executives.

Cost of Turnover

SHRM Briefly Stated ROI Series
www.shrm.org
Turnover Costs May Be Categorized Into Four Types:

Separation Processing Costs (e.g. exit interviews and administrative overhead)
Replacement Hiring Costs (e.g. recruiting and interviewing replacements)
Training Costs
Lost Productivity (e.g. performance differential as a new hire gets up to speed etc.)

In Their Shoes

HHR Magazine, August 2001
www.shrm.org
Point of Interest:

The average cost of turnover is between 33 percent and 250 percent of an employees annual pay.

Workplace Violence: Trends and Strategic Tools for Mitigating Risk

SHRM White Paper
www.shrm.org
Points of Interest:

Workplace homicides are the second leading cause of fatalities within the workplace for males and the first leading cause of fatalities for females.
The fourteen of the fifteen assailants studied had a history of violence, substance abuse, mental health problems and/or criminal convictions.
Negligent Hiring is "the failure of the employer to investigate a job applicant's work experience, character, criminal history and other relevant data prior to the hiring of an employee."
An acceptable practice for background investigations usually includes:
(i) verifying prior employment;
(ii) verifying educational experience;
(iii) obtaining information relative to experience, knowledge and skills;
(iv) obtaining criminal conviction information; and
(v) in positions where there is financial risk, obtaining personal credit history information, including personal bankruptcy filings.

Note: A Matter of Fact has no control over the content of the above sites and is not responsible for their content.

Ready to Go?
Use our Start-Up Kit for a step-by-step approach to getting started Account Setup is Free

Background Check Articles by Industry Sources