All You Need to Know about Workplace Screening

Have you hired a new accountant but later realized he was counting on his fingers? Or maybe your new driver has a DWI conviction? By outsourcing workplace screening, you can easily find out how qualified a candidate really is before second-round interviews begin.

by Denise Doig

With improving technology and resources, workplace screening and security are no longer exclusive to government and military employers. Almost all organizations screen candidates in some fashion. Recent corporate scandals involving embezzlement and fraud have created greater public awareness on the importance of background screening. During the recent Hurricane Katrina disaster, it was discovered that former FEMA director Michael Brown was highly unqualified for his position because of numerous work history inconsistencies on his resumé.

For this very reason, more and more organizations are interested in improving their screening functions. Once a necessity for the Fortune 100 companies, screening programs have now trickled down to small and mid-sized businesses. While it may be a requirement in some industries such as financial services and banking, screening in other sectors can improve the bottom line. In retail, for example, screening has been helpful in reducing employee theft. According to Robert Capwell, president and CEO of Comprehensive Information Services, “Retail theft is just outrageous. I think the statistic is one in every four retailers go bankrupt just because of theft.”

A HERCULEAN EFFORT SOMETIMES
Like many HR functions, workplace screening can be a time-consuming component of the staffing process. Companies may not have the time or the resources to screen large groups of candidates. With complex compliance issues on the federal and state levels further complicating the process, employers often don’t have the breadth of knowledge to administer accurate background checks. Instead of conducting sub-par checks, which could lead to bigger problems down the line, companies are turning to outsourcing to help weed out the wrong candidates.

Outsourcing not only saves time and money, but providers also have better capabilities to properly screen potential employees. “It allows a company to essentially outsource a critical function of their hiring practice to a company that already has the expertise, has systems in place, has experience in how to do it, and, in the short and long run, it allows a company to save money on having to pay their own people,” claims Rob Seiden, president of Fortress Global Investigations.

Screening is the most effective way for companies to protect themselves against fraudulent hires. Not only does it raise red flags on a candidate’s record, but it also provides a picture of how honest a person has been about his past. Accurate Background’s executive VP, Catherine Aldrich, had this to say, “In general, screening is conducted to reduce losses and secure better, higher-quality new hires. Hiring the wrong person, training them, and then realizing they don’t have the qualifications cost money.”

For many companies, getting a screening program off the ground is a daunting task. Hiring an unqualified screening provider can be detrimental to an organization. Fortunately, there are resources such as SHRM and the National Association of Professional Background Screeners (NAPBS) to help with the process. According to Aldrich, “The only way to ensure a reputable screening company is by using an NAPBS member.”

Before a screening company can become a member of NAPBS, it must agree to adhere to a code of ethics, which includes following any and all laws that regulate the screening industry such as the Federal Credit Reporting Act (FCRA), following best practices, and instituting quality- control measures. HR professionals looking for screening providers can use NAPBS membership as a way to eliminate unqualified companies offering background check services.

There are thousands of companies that provide screening services, with some based out of home offices with limited access to paid searches and databases, some catering to niche markets, and others that are national in scope screening millions of candidates yearly. Whichever provider a client chooses, there are some fundamental steps to consider. When a company is ready to outsource screening, the HR professional in charge should research all options. There are many online companies offering the sun, moon, and stars, but you get what you pay for.

“What I would stress is that there are a lot of offerings on the Net that are inexpensive, but tools that only search on the Net are a complete waste of time,” Aldrich said.

Before partnering with a provider, companies should first have a consultation to discuss why they want to outsource, what they hope to achieve, and what screening functions they are interested in. A good provider will ask the right questions, such as what the company’s business functions are and what laws or regulations the client has to comply with.

Capwell cautioned, “We want to know even more if we’re pulling credit reports for that client. The credit bureaus actually require us to go out and do a site verification, making sure that whoever we’re doing business with is not some boiler room-type marketing firm out of someone’s home and is actually a legitimate business.”

Because privacy laws vary from state to state, providers must be knowledgeable and make sure they follow these regulations while conducting background checks. Screening providers must also comply with the FCRA. If these regulations are ignored, the background search possibly can be invalidated. Seiden, a lawyer, added, “There are many legal issues intertwined, inextricably intertwined, with the issues involving pre-employment screening and new hires. There are a lot of labor issues, so having knowledge of law and how law affects human actions before, during, and after employment is critical.”

Once the consultation is complete, a
package can be customized for the client. Many online screening solutions are integrated with applicant tracking systems provided by outside recruiting and staffing firms, which collect candidate data upfront, providing screening providers a wealth of candidate information. The candidate fills out an electronic form during the interview or onsite at the provider’s office, another option is the employer can enter the candidate’s information into the system. Next, providers begin their search on the candidate; once it is complete the information is compiled into a report for the client.

According to industry experts, almost 40 percent of applicants lie on their resumé, whether it is fudging dates of employment, discrepancies in job descriptions and titles held, or lying about their education history. Capwell added, “We find on average about 8 percent of applicants have some type of prior criminal history, that could be either a misdemeanor or a felony.” With more companies introducing screening programs, there may be a drop in the number of unqualified or dishonest candidates.

In fact, many businesses have been late to the workplace screening party. Yes, they may now have a program in place to conduct background checks on new hires, but there is a large group of current employees who have never been screened. It is very possible to hire an individual who, down the line, commits a serious crime that could jeopardize not only a company but its employees as well. When it comes to current employees, how can a company screen someone once they’ve already been hired?

Many employers conduct checks when a current employee is promoted or transferred, others only screen high-level executives. Also common is random screening. Because screening an entire company can be quite expensive, HR and department managers may decide which unit to screen at random. All employees are informed that background screenings will occur, but they do not know when and who will be checked. According to Capwell, “Companies may do screening for cause, and that is one thing now that you don’t have to have authorization for. So if you think that someone is stealing from your  organization and you have proof, you would do a background investigation for reasonable suspicion.”

To screen new and current employees; all you need is the right partner. Screening providers work not only on a national level, but some can provide services on an international basis. By using global search databases—including Interpol and local police and court records—offshore screens can be conducted. Providers can either do these themselves in the United States or from international hubs, or they can outsource the function to foreign screening companies.

Capwell had this warning: “There are various laws and guidelines in certain states and also guidelines that are very different from the United States when conducting international searches. Your screening company really needs to understand this.”

International screening may be more costly in comparison to domestic screens, which can run from $50 to $100 per candidate. The reason is that many foreign countries do not have extensive databases due to inadequate technology; there is also a lack or cooperation and coordination between various regions and local law enforcement. Interestingly, like in most areas of offshoring, the outsourced Indian screening market is growing, while Europe is playing catch up.

With legislative improvements, higher incidents of workplace violence, and heightened security awareness, workplace screening has changed dramatically in recent years. The most obvious change has been technological. Whereas in the past pre-screen results were delivered as printed reports via mail or fax, the background check industry has gone digital. Screening questionnaires as well as the results are online and can be e-mailed or downloaded for the client. Also more companies are establishing screening programs than in past.

According to Aldrich, the next wave in screening trends will be improvements in “workflow efficiencies, the different types of checks offered in packages, and volume equation.” As providers move away from traditional methods of screening, companies want more than the basics such as social security verification. Instead they want the capability to have all criminal information pertaining to the candidate from every country in which they have resided during the past 10 years. “We have more automated tools that we get things faster in our industry. There are databases now that we can gather national criminal information, sex offender information, and also global information. Now we can get access to a number of federal and international watch lists to expand our screening,” Capwell added. With more comprehensive screens, employers can be more vigilant in their hires.

Another big trend to watch involves the contingent workforce. Aldrich warned, “An organization may have internal screening guidelines, but they may use a contingent staffing agency that may not conduct background checks of the same caliber. There can be a situation where contingent workers are not qualified to work under the organization’s guidelines. We stress that clients should have vendors following the same background screening processes and procedures as the client.”

Bringing the wrong person on board can create serious headaches down the line. Outsourcing screening services is not only about putting the onus on the provider; it’s also about protecting an organization’s current employees and clients.

Posted November 10, 2005 in Talent Acquisition

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