In today’s increasingly competitive labour market, organisations are no doubt in a hurry to snatch up the cream of the crop. However, when hiring managers cut corners to speed up the onboarding process, such as skipping the need for background checks, this should raise the alarm bells.
According to a survey by the Society for Human Resource Management (SHRM), 92% of surveyed employers conduct employment background screening. While most of the surveyed employers run background checks during the pre-employment stage, there are also organisations that conduct background checks throughout the hiring cycle.
Reasons for conducting background checks
Conducting background checks should be a major part of every organisation’s hiring process. It helps to reduce the risk of criminal activities such as harassment, abuse or theft. They can also help HR managers to verify the information on the applicant’s resume and assist hiring managers in deciding if the potential candidate is a good fit for the organisation. Ideally, background checks should be the organisation’s first line of defense.
Employers have a legal obligation to protect their business, employees and customers from any harm or legal liability of any type to the employer or employees. This may include harmful acts such as workplace violence or sexual harassment, negligent driving resulting in harm to the public, or financial and reputational loss. If the organisation fails to conduct a background check prior to hiring, and that particular employee commits an offence while on the job, it will be a given that the organisation assumes the liability for their actions. As such, it is best to avoid negligent hiring by conducting thorough background checks on potential candidates.
Verifying personal or professional information provided by the candidate, such as educational history, professional certifications and employment tenure and history, will not only confirm the required qualifications but also provide insights on the candidate’s credibility and reliability. In fact, according to an article published by SHRM, it highlighted that educational achievements tell a great deal about an applicant’s ability and motivation and is intrinsically linked to success on the job. For example, a Bausch & Lomb Chief Executive Officer was forced to step down after it was revealed that his resume contained false information about his education. A background check helps verify that the information provided by the candidate is indeed accurate.
Past workplace performance is often a strong indicator of the candidate’s performance in their next role. It can also reveal the candidate’s professionalism, productivity, job skills, communication and leadership skills – soft skills that are not easily distinguishable on a resume. A background check can help to reveal the true talents from the posers.
Types of background checks
There are many types of pre-employment checks being run today. However, there is no “right” type that best fits an organisation. Most organisations use a mix of pre-employment checks that best fits their organisation based on the industry they are in as well as the nature of the role. Some of the more common pre-employment background checks that organisations conduct as below:
Surprisingly, some candidates do falsify their employment history on your resumes. This may include lies on their job responsibilities, tenure, skill sets or even job titles and roles. In fact, survey findings from Checkster, a reference checking company, found that 50% of the surveyed 400 job applicants have lied about working at a company longer than they did in order to omit another employer. Similarly, close to half (41%) have indicated a “Director” title on their resume, when the actual role was a “Manager” or other equivalent level. As a rule of thumb, HR professionals should minimally verify the potential candidates’ dates of employment, job titles, overview of duties performance as well as reason for leaving with the previous employers.
Lying about educational qualifications that were never obtained is also a common resume falsehood. In fact, some high-profile cases of individuals who lied about their educational qualifications include Jeffrey Papows, President of IBM’s software maker Lotus Development as well as Scott Thomspon, Yahoo’s Chief Executive Officer. While educational qualifications and professional certifications often play a minor aspect in determining the candidate’s fit for the role, it helps the hiring manager and HR professional to determine if the candidate has at least the minimal competencies to perform the job.
Criminal background checks are critical to ensure a safe workplace environment for the organisation’s existing employees. In fact, many organisations also perform criminal background checks on current employees, either as a matter of course or prior to a promotion, job transfer or change in the employment’s terms and conditions.
Certain industries, such as the financial services or financial technology sector, may run credit report checks on the candidate if the position involves some form of financial responsibility, such as bank tellers or credit loan managers. These credit report checks help the hiring manager ascertain whether the candidate’s financial status may pose a risk when handling money or exercising financial discretion. For example, a candidate with a past poor credit record or huge outstanding debts may pose a risk, such as syphoning or executing fraudulent activities, when put in a position that requires them to handle large sums of money.
Motor vehicle records
Organisations may run motor vehicle records if the position requires the candidate to operate an organisation vehicle or drive a personal or rental car for business purposes. A motor vehicle record will typically show the candidate’s licence status, licence class, expiration date, historical traffic violations, and suspensions or cancellations, if any. These records provide insights to the hiring manager as to whether the candidate is able to operate vehicles in a safe manner while on the roads.
A personal reference check may be one of the most insightful background checks. However, it can also be one of the most difficult to conduct. Whether it is done in-house or through an external vendor,
well-organised and thorough personal reference checks can yield valuable information about the potential candidates – information that is often difficult to glean from the resume or through other forms of background checks. This can provide insights about the candidate’s soft skills, such as communication, leadership and motivation levels.