Before You Hire: References and Background Checks

Once you have finished interviews and decided on the right person for the job, there are still a few more steps that must be completed before you formally offer the candidate the job. Every resume either lists references or indicates that they are available upon request. How often do employers actually check references and perform background checks? Not often enough. When you take into consideration that up to 40% of the information provided on resumes is misrepresented, it stands to reason that digging further into potential employees is not only extremely important, but vital to protecting the company.

A company’s hiring policy should include several stages of fact-checking on any possible new hire. The first step is to contact the references listed on the resume. Employers often believe that references provided will not be truthful. Applicants choose their own references, and it is hard to believe that they will be honest about any problems or performance issues with their former employee. Therefore, business owners take the “why bother?” stance. But asking the right questions is the best way to get to the bottom of the employee’s performance. Avoid asking ‘yes’ or ‘no’ questions and questions that are vague. Focus on facts. While you may want to know the reference’s opinion, it is not reliable information. What is reliable is asking about particular facts and examples the person provided during their interview. Also, questions about percentages and numbers may help. For example, don’t ask if the employee missed much work. Ask what percentage of the time he was late or called in. Don’t ask if they were a leader in the office. Ask how many projects she lead from start to finish. This type of question gives much more useful information.

The second step of vesting a possible employee is performing background checks. The type of position being filled will dictate exactly what checks need to be performed. For positions that involve driving company vehicles, it is wise to check driving records. Applicants that will hold jobs like accountant or treasurer may require a credit check. The most common type of background check is a criminal one. Make sure when you are reviewing the record of a new hire that you look at convictions, years since the crime, and the seriousness of the crime. Also, take into consideration if the employee disclosed this during their interview or on their application. Keep in mind that before any background checks are run, the applicant must sign a release form. This form should be kept on file and must be separate from the application. Also keep in mind the law takes measures to protect the employee’s privacy and the checks run are indicated by the type of job that will be performed. This will be a protection against future legal trouble involving breaches of privacy or discrimination.

Last, before you make the formal offer, check up on certifications, licenses, and degrees. If a resume lists a master’s degree in business administration and you are hiring someone for a high-level management position, it stands to reason that double checking they actually hold that degree makes good sense. When hiring a licensed speech therapist, contact the appropriate state agency to insure that licenses are up to date. If you require a childcare worker in your daycare to be certified in infant and child CPR, it is better to know before an emergency that they did complete the proper courses. It may seem tedious to check on these types of things, but it will alleviate future stresses. If the information was embellished or falsified on the resume, then that is not the type of person you want on your team.

It should be a policy to perform checks on references and backgrounds for every new hire. If it is only being done occasionally or depending on the interview, then you are opening up your company to future discrimination lawsuits. Consulting an attorney to determine what is appropriate is the best way to avoid future legal trouble. Checking on everyone, whether they are being hired to be CEO or a stock clerk, ensures that you are above reproach in your hiring practices. Up to 30% of information on applications is false and 72% of negligent hiring suits are lost by the employer. Setting up and maintaining consistent processes for vesting employees will ensure that all new hires are high quality and there is no legal recourse by someone who does not meet your company’s high standards.