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Background Check Articles

(Government & Industry)

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

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

Also see Employment Background Check Guidelines and Sample Policies from Industry Sources

WorkPlace Violence

U.S. Department of Justice: Federal Bureau of Investigation
http://www.fbi.gov/stats-services/publications/workplace-violence
Points of Interest:

• Workplace Violence preventive practices include pre-employment screening, identifying problem situations and risk factors, and security preparations.
• Identifying and screening out potentially violent people before hiring is an obvious means of preventing workplace violence.
• As an applicant is examined, the following can raise red flags:
  • A history of drug or alcohol abuse.
  • Past conflicts (especially if violence was involved) with co-workers.
  • Past convictions for violent crimes.
  • Other red flags can include a defensive, hostile attitude; a history of frequent job changes; and a tendency to blame others for problems.

Crime Characteristics: Summary Findings

Bureau of Justice Statistics
Points of Interest:

• Workplace violence accounted for 18 percent of all violent crime.
• Victims of workplace violence identified intimates as the perpetrator in about 1 percent of all violent workplace crimes. About 40 percent of the victims of nonfatal violence in the workplace reported that they knew their offenders.
• Of victims of violent crime, 22 percent were involved in some form of leisure activity away from home at the time of their victimization, 22 percent said they were at home, and another 20 percent mentioned they were at work or traveling to or from work when the crime occurred.
• While working or on duty, U.S. residents experienced 1.7 million violent victimizations annually from 1993 to 1999, including 1.3 million simple assaults, 325,000 aggravated assaults, 36,500 rapes and sexual assaults, 70,000 robberies, and 900 homicides.
• In every year from 1992 to 2002, students ages 12-18 were more likely to experience a serious violent crime away from school than at school.

ACFE: 2010 Report to the Nation on Occupational Fraud and Abuse

Association of Certified Fraud Examiners (ACFE)
http://www.acfe.com/rttn/
Points of Interest:

• The typical organization loses 5% of its annual revenue to fraud.
• The median loss caused by occupational fraud was $160,000. Nearly one-quarter of frauds involved losses of at least $1 million.
• Small organizations are disproportionately victimized by occupational fraud.

Right Management Survey

Right Management
Impact of a Bad Hire, Press Release
Key Points:

• Lower employee morale and decreased productivity are the biggest negative consequences.
• Other negative consequences include: lost customers and market share, and higher training, recruitment, and severance costs.
• The average cost of a bad hire is 2.5 times the employee’s salary. 42% of survey respondents said the cost of a bad hire is at least 3 times the employee’s salary.

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.

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.

The Case for Background Checks

Insurance & Technology
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 resumes 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 resume 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.

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
NAPBS.com
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)."

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.)

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.
• 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.

Reading a Credit Report

Consumer Credit Counseling Service of Orange County
http://www.cccsoc.org/pages/credit_guide/credit_guide_05.phtml
Point of Interest:

• Step by step guide to reading a Credit Report

Glossary of Credit Terms

Experian
http://www.experian.com/credit-education/glossary.html
Point of Interest:

• Glossary of Credit Terms

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.

Restrictions on Criminal Record Checks

U.S. Chamber of Commerce
http://www.uschambersmallbusinessnation.com/toolkits/guide/P05_1600 (membership login required)
Point of Interest:

• State by State review of restrictions on the use of Criminal Record Checks

Also see above, Criminal Background Checks for Employment Purposes
Also see above, Criminal Background Checks: A Checklist of the Pros and Cons

Database of Accredited Postsecondary Institutions and Programs

U.S. Department of Education
http://ope.ed.gov/accreditation/

• The database is provided as a public service. Office of Postsecondary Education (OPE) recommends that the database be used as one source of qualitative information and that additional sources of qualitative information be consulted.

Database of Institutions and Programs Accredited by Recognized United States Accrediting Organizations

Council for Higher Education Accreditation
http://www.chea.org/search/

• The Council for Higher Education Accreditation (CHEA) database lists more than 7,800 degree-granting and non-degree-granting institutions and more than 20,000 programs that are accredited by United States accrediting organizations that have been recognized either by CHEA or by the United States Department of Education (USDE) or both.

Diploma Mill or Legitimate Educational Institution?

Employment Background Check Blog
http://www.amof.info/blog/2011/11/diploma-mill-or-legitimate-educational-institution/
Points of Interest:

• Diploma mills (or degree mills) are substandard or fraudulent "colleges" that offer potential students degrees with little or no serious work.
• Hawaii, Maine, Michigan, Oregon, and Texas publish "Diploma Mill" lists.

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 resumes 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.

Avoid Fake-Degree Burns By Researching Academic Credentials

FTC
http://business.ftc.gov/documents/bus65-avoid-fake-degree-burns-researching-academic-credentials
Points of Interest:

• Tell-tale signs of a bogus degree include: out of sequence degrees, quickie degrees, degrees from schools in locations different from the applicant’s job or home, and sound-alike names.
• Steps to verify academic credentials: contact the school, research the school on the internet, and ask the applicant for proof of the degree and the school’s accreditation.

Workplace Substance Abuse Statistics Fact Sheet

Substance Abuse & Mental Health Services Administration
http://www.workplace.samhsa.gov/WPWorkit/pdf/workplace_substance_abuse_statistics_fs.pdf
Points of Interest:

• People with drug and alcohol problems are not likely to leave those problems behind when they come to work.
• On-the-job drug use can lead to an increased risk of accidents and injuries. It can also lead to lower levels of productivity and employee morale, not only among those with substance abuse problems but also among those working alongside them.
• Over 7 percent of American workers drink during the workday, mostly at lunch. Even more—9 percent—have nursed a hangover in the workplace.

Workplace Substance Use: Quick Facts to Inform Managers

Substance Abuse & Mental Health Services Administration
http://www.workplace.samhsa.gov/Workplaces/pdf/WorkplaceDrugUseFactSheet.pdf
Points of Interest:

• Regardless of where illicit drug use or heavy alcohol use takes place, workers reporting substance use and abuse have higher rates of turnover and absenteeism.
  • Workers reporting heavy alcohol use or illicit drug use, as well as workers reporting dependence on or abuse of alcohol or illicit drugs, are more likely to have worked for more than three employers in the past year.
  • Workers reporting past-month illicit drug use or dependence on or abuse of alcohol or illicit drugs were more likely to have missed more than two days of work due to illness or injury in the past month.
• Co-worker job performance and attitudes are negatively affected by fellow employee substance use and abuse.

Drugs in the Workplace: Fact Sheet

Substance Abuse & Mental Health Services Administration
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.

E-Verify Employer DOs and DON’Ts

U.S. Department of Justice
http://www.justice.gov/crt/about/osc/pdf/publications/e_verifydosanddonts.pdf
Points of Interest:

• E-Verify dos and don'ts for employers.

See Free SSN Validator
Note: The value of tools like this are diminishing due to the new SSA "SSN Randomization" process.

Electronic Records And Signatures In Commerce

Legal Information Institute
http://www.law.cornell.edu/uscode/15/ch96schI.html
Point of Interest:

• Full text of the law

Impact Report: Electronic Signatures In Global And National Commerce Act

Federal Trade Commission and Department Of Commerce
http://www.ftc.gov/os/2001/06/esign7.htm
Points of Interest:

• The benefits of the consumer consent provision of ESIGN outweigh the burdens of its implementation on electronic commerce. The provision facilitates e-commerce and the use of electronic records and signatures while enhancing consumer confidence. It preserves the right of consumers to receive written information required by state and federal law. The provision also discourages deception and fraud by those who might fail to provide consumers with information the law requires that they receive.
• The consumer consent provision in ESIGN appears to be working satisfactorily at this stage of the Act's implementation.

Electronic Signatures in Global and National Commerce Act

Wikipedia
http://en.wikipedia.org/wiki/Electronic_Signatures_in_Global_and_National_Commerce_Act
Points of Interest:

• Sections from the ESIGN Act
• Consumer Disclosure
• Retention of contracts and records

NAPBS® Launches Formal Accreditation Program

The National Association of Professional Background Screeners (NAPBS®)
NAPBS.com
Points of Interest:

• NAPBS believes that there is a strong need for a singular cohesive background screening industry standard.
• Accreditation will stand as the industry "seal" representing a background screening organization's commitment to excellence, accountability, high professional standards and continued institutional improvement.

10 Ways to Catch a Liar

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

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

California LiveScan, A Real Background Check?

Kit Fremin
http://ezinearticles.com/?California-LiveScan,-A-Real-Background-Check?&id=818999
Point of Interest:

• Live Scan Does Not Report All Criminal History. The only records checked are related to child abuse or elder abuse, sex offenders (the sex offender registry is NOT checked), and convictions or incarcerations in the last 10 years as a result of committing theft, robbery burglary or any felony. A partial list of what it does not cover is Assault, Accessory to a crime, Aiding and abetting, Bad check writing, Carrying a gun without a license, Contempt, Domestic Violence, False impersonation, Medicare fraud, Stalking, Drug possession, Indecent exposure, Misdemeanor Prostitution, Lewd conduct, Disorderly conduct, Disturbing the peace, Vandalism, Trespassing, Malicious mischief, Public drunkenness and the list goes on.

Legal Dictionary Search

findlaw.com
http://dictionary.lp.findlaw.com/
Point of Interest:

• Legal Dictionary Search

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

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