Hiring the right person for a job begins with knowing who you are hiring and whether she will contribute to your foundation for success.
Employers know the concerns and costs associated with bad hires — nearly 80 per cent of employers use background checks, according to a study of workers in the United States (see sidebar on page 20).
Companies that protect themselves through due diligence processes can save money and substantially reduce financial and legal risks in the workplace. Pre-employment screening can reduce or avoid:
• negligent hiring lawsuits as screening demonstrates due diligence
• workplace violence because a history of criminal acts is a major factor
• unqualified applicants as many applicants contain material falsehoods
• time wasted recruiting, training and hiring the wrong applicants
• wrongful termination lawsuits — even if applicants lie in the hiring process
• theft, financial loss, sexual harassment and other workforce problems.
Employers have an absolute right to conduct lawful pre-employment screening to hire the best‐qualified person for a position. Areas to take into consideration are employer rights, workplace safety, discrimination (laws prohibit an employer to request an applicant’s sex, origin, race, age and disability) and privacy.
In 2004, the federal government introduced the Personal Information Protection and Electronic Documents Act (PIPEDA) to protect the privacy of Canadians in the private sector. PIPEDA applies throughout Canada, except for British Columbia, Alberta and Quebec, which have legislation considered “substantially similar” by the federal government.
Employers are advised to tell applicants early in the hiring process that screening is part of the company policy and the HR process. When a position is made available, an employer will supply a hiring package that includes a screening consent form. This form gives the employer and third-party screening provider permission to conduct searches. Individuals not comfortable with this process may choose to withdraw their application for hire. This provides yet another deciphering tool for the employer.
Signed consent allows HR to obtain and verify information, including a record of criminal history, credit reliability, driving history, verification of a previous employer and education accreditation.
There are a large number of services available under the umbrella of background checks and, with so much data readily accessible, the options are vast. From social networking searches, media checks and ID verifications to reference checks, a lot of information can be gathered on an individual.
Searches are available in Canada and the United States through local screening providers. Some providers also offer international services which can be more expensive and require additional consent and restricted information. There are also country-specific regulatory bodies and legislative requirements to consider.
When wondering how much information is needed, the answer may lie in the employer’s industry, human rights legislation or company policies. Many human resources departments feel they must perform the same background checks on each applicant within the company, regardless of their position.
But the due diligence performed on a CFO should not be equivalent to that of a warehouse worker — their roles have different levels of responsibility and require applicable screening authentication.
A CFO is handling cash and budgets in an executive position within the company, so a credit check is required. A warehouse staff member, on the other hand, may have no fiscal responsibility so a credit report isn’t necessary — a reference check may suit this position better. Essentially, the results should be recent and relevant to the purposes of the role.
Pre-employment screening is a great tool, as past behaviour is an indication of future behaviour. Performing background screening not only fulfills due diligence obligations and protects employers from the liabilities of negligent hiring but also makes good business sense.
Ken Cahoon is director and managing partner at Canpro Global Services in Vancouver. He can be reached at
(604) 787-4010 or firstname.lastname@example.org.
By the numbers
8 in 10 firms do checks: Survey
Background checks are an established part of the hiring process — 78 per cent of organizations use background checks for 80 per cent or more of their hires, according to a 2011 survey of 783 workers in the United States conducted by EmployeeScreenIQ. Eight per cent use background checks for under 20 per cent of their hires.
Highlights of the survey, titled
Trends in Employment Background Screening
• Forty-three per cent of employers typically conduct a background check before extending a job offer to a candidate or immediately following the job offer (39 per cent) while 14 per cent do it after establishing pre-qualified job applicants and five per cent do it after the start date.
• If a background check reveals adverse information, only eight per cent of respondents reject a candidate outright. Fifty-one per cent will consider job relevance or the severity of the information while 33 per cent will go directly to the candidate for more information.
• Respondents cited qualifications (90 per cent) and interviews (75 per cent) as the most important factor when making hiring decisions. They ranked candidates’ criminal records third in importance (32 per cent) followed by references and credit checks (both at 13 per cent).
• One-third of employers don’t perform credit checks while 38 per cent only do so for a position with financial responsibility and 21 per cent do it for all employees.
• Two-thirds (66 per cent) of respondents never check social networking sites such as Facebook and LinkedIn.