By Lester Rosen, President of ESR

(Originally Published on HR.Toolbox.com)

It’s a sobering thought, but every time a recruiting professional makes a placement, there is the possibility that new hire can put them out of business.

Why? Because if a dangerous, unqualified, unfit, or dishonest candidate is placed in a job and harm occurs, the hiring firm risks a lawsuit for negligent hiring. Perhaps just as importantly, a bad placement can result in loss of business and damage to a professional reputation that may have been years in the making.

The root of the problem, of course, is that some candidates lie on their resumes and applications. Industry statistics suggest that up to 10% of applicants can have criminal records. Fraudulent misrepresentations as to education and employment occur in as much as 40% of the time, according to some studies.

Individual recruiters can, in fact, be sued for negligence if harm occurs, and if she or he knew or should have reasonably foreseen that a bad placement could cause a problem. At that point, the heart of the staffing professional may sink when those dreaded words echo across the courtroom: “Ladies and Gentleman of the Jury.”

Those are words you never want to hear, and a situation in which you never want to be. Your protection and your best defense is to exercise “due diligence,” which means to verify the representations and qualifications of the candidate.

The allegation in a “Negligent Hiring” lawsuit (or “Bad Hire” lawsuit) would be that the staffing professional placed someone that they either knew or, in the exercise of reasonable care, should have known was unfit or dangerous. Of course, since a staffing professional would not intentionally place someone who was dangerous or unfit, the question before the judge or jury is whether the staffing professional reasonably should have known that the placement was bad if they had only exercised a greater degree of care in screening the applicant.

In such a lawsuit, a staffing professional would need to show, for example, whether credentials and education were verified, whether past employment was checked, and whether a criminal background check was done.

Lawsuits occur usually in cases where there is some sort of serious harm either to a business, such as embezzlement, or theft, or to an individual, such as assault, rape, child molestation, identity theft, or even homicide.

A staffing professional who is responsible for a bad placement can be sued by a number of parties, including the business entity that relied upon the professional judgment of the recruiter or staffing firm. Certainly, a co-worker or member of the public who was injured by the bad hire can sue for damages.

The worst case scenario would be that the bad hire resulted in the death of a fellow worker, and the victim’s family is suing for wrongful death. This is just what happened in a highly publicized case in California. A 28-year-old female winery worker was stabbed to death by a co-worker who was a convicted murderer and had been placed at the winery by a temp agency. The agency did NOT conduct a background check. The jury awarded the family $5.5 million.

If a recruiter is sued, it may well be an uphill battle to win in court. The jury will hear evidence that the recruiter recruited, recommended, or placed the offender. In most cases, the staffing professional probably makes representations about the quality of their services. The staffing professional’s website and sales literature may suggest that they provide only the best candidates who are carefully screened. However, in the world of recruiting, “screening” really only means that resumes have been reviewed to determine a good fit as opposed to “background screening” for criminal records and verification of facts represented on the resume.

The employer, hoping to lay the blame onto someone else, will of course claim that they relied upon the professional abilities of the staffing professional to send them qualified and safe candidates. There would likely be evidence that the recruiting or staffing firm made a fee on the placement. In the end, the attorney for the injured or deceased employee would ask jury members, “Didn’t the staffing professional have not only the resources and opportunity, but also the duty to conduct employee screening on the potential employee before approving their introduction into the workplace?”

In this scenario, it is not likely that the jury members will have much sympathy for the hiring firm or staffing professional.

Some recruiting professionals have resisted the idea of background checks because they feel that with their years of experience, they are good judges of people. That is no longer a defensible position, nor is it even accurate. A growing body of scientific evidence suggests that even the most experienced recruiters cannot eliminate potential bad hires by detecting lies and evasions at the interview. Studies show that even though people believe they can detect liars, most people have only a 50-50 chance at best of detecting a liar. According to one recent study, even trained law enforcement officers are only right a little over half the time. The traditional means of reading body language, for instance, to screen out liars are useless against an accomplished con artist who can tell stories very convincingly.

Some recruiters may be concerned that background checks add to the cost of their services or hinder placement with unneeded delays while screening results are obtained. However, in today’s litigious world, recruiters and staffing professionals need to make a risk-management assessment: Is saving a few dollars and a little time worth playing Russian Roulette with each candidate you send out? Which one of these candidates will land you in court, or on the front page of the newspaper? Will your professional reputation be tarnished forever, perhaps beyond repair?

The bottom line is that due diligence and background checks go to the very integrity of the product being sold by recruiting and staffing professionals – workers who are qualified and fit for the job. Selling staffing services without knowing who you are sending to a client’s business would be like selling medicine with no idea of what is in the bottle.

Staffing and Search professionals have traditionally focused on Sourcing and Sales. It is worth noting that at some recruiting conferences, there are a large number of sessions devoted to making money through finding candidates and selling services. However, there are few sessions, if any, on the subject of how to ensure the integrity of the very product being sold. Recruiting and staffing professionals can protect their own business, their clients, and the public by shifting their focus from just Sourcing and Sales to Sourcing, Verifying and Sales.

For more information on employment screening and background checks for recruiters, visit Employment Screening Resources (ESR) at http://www.esrcheck.com.

Source:

http://hr.toolbox.com/blogs/background-checks/recruiting-russian-roulette-why-every-placement-you-make-has-the-potential-of-putting-you-out-of-business-35960

By Lester Rosen, President of ESR

(Originally published on HR.com)

Part of the on boarding process for most in-house recruiters is the completion of the pre-employment background check.  The challenge for in-house recruiters is that they are typically under intense time pressure to complete the hiring process quickly and to get the new person started.  On the other hand, it is mission critical that employers exercise due diligence in their hiring.  If an employer hires someone who turns out to be dangerous, unfit or unqualified and some harm occurs where it was foreseeable that a bad hire could cause damage, then the firm can be on the hook for a negligent hiring lawsuit, not to mention all of the other costs, workplace problems and negative publicity associated with a bad hire. Of course, a bad hire does not reflect well on a recruiter either.

In a perfect world, a recruiter would like to be able to go to a web site that has an accurate and up-to-date database so the employer can get an immediate thumbs up or down.  However, no such web site exists because much of the data needed to do a background check is not gathered and databased ahead of time.  There is not even a comprehensive national criminal records database that reveals an accurate criminal history. Most private employers do not have access to the FBI criminal database, and even that database is subject to numerous sources of errors.

As a result, background checks are conducted by actually calling up schools and past employers and going to courthouses.  A background check will typically take three days, and that is assuming the universe is cooperating and there are no delays out of anyone’s control.  However, there can be delays if an employer has gone out of business or refuses to call back, or a school is closed for a holiday or requires a release or check sent by mail.  Further delays can occur if there are potential criminal record matches, and the court clerk delays producing the file so a screening firm can confirm identifiers to determine if the record applies to the applicant and whether the case can even be reported under complex federal and state rules.

Those time requirements for a background check can conflict with the time pressure a recruiter is under.  The good news is that a recruiter can be pro-active in speeding up background checks in several ways:

• Recruiters must understand the process can be delayed if screening firms are sent incomplete information, or supplied with forms that are illegible or incomplete. For example, screening firms often face difficulty in deciphering an applicant’s past employers or social security number. Since a screening firm is not expected to read hieroglyphics or be a mind reader, the screening firm has to contact the recruiter to clarify the information. Some screening firms will make their best guess and if they are wrong, the report is delayed even further, proving the old adage that no good deed goes unpunished. Recruiters who review all applications for completeness, legibility and accuracy with the candidates before sending the applications to a screening firm will find their work is completed much faster.
• An in-house recruiter needs to communicate with hiring managers to eliminate unrealistic expectations. A hiring manager may not understand, for example, that criminal records are searched at each relevant courthouse, or that delays can occur if there is a potential match and the court needs to bring files from storage. Hiring managers must also be advised that employment and education verifications can be delayed for a number of reasons, such as schools that are on vacation or that require a check or release to be mailed, or employers that are closed, merged or refuse to cooperate. If there is a delay in receiving a completed screening report, the recruiter should examine the source of the delay.
• If a recruiter is working with a screening firm that has an online ordering system, the process is considerably faster. Not only does this ensure accuracy, which makes the process faster, but it also avoids delays caused by sending a request to a screening firm and waiting for the firm to do manual data entry.
• Finally, there are times when a recruiter should determine that even though the screening firm has not been successful in obtaining all of the information, enough data is available to make a hiring decision. This typically happens in the area of verifying previous employment. When conducting employment verifications, often times the earliest employment is the most difficult to obtain. However, it may also be the least relevant. If the applicant, for example, worked in a fast food restaurant six years ago after getting out of school and the fast food place will not call back, then there may be no reason to delay the hiring decision, especially if the screening firm has obtained the most recent, and presumably more relevant, job verifications.

Experienced recruiters understand that background checks are not only a critical part of the hiring process, but are a great deal more complicated than merely putting a name in a database. A competent background checking process requires specialized knowledge, resources and experience. This is particularly true since employment screening is a highly regulated area. The best way to speed up the process is to understand exactly what is involved in facilitating the smooth flow of accurate data.

For more information on how background checks for recruiters, please visit Employment Screening Resources (ESR) at http://www.ESRcheck.com.

Source:

http://www.hr.com/SITEFORUM?&t=/Default/gateway&i=1116423256281&application=story&active=no&ParentID=1119278002800&StoryID=1244757230498&xref=http%3A//www.google.com/search%3Fsourceid%3Dnavclient%26ie%3DUTF-8%26rlz%3D1T4SUNA_enUS287US289%26q%3DRecruiters+and+Background+Checks—How+to+Speed+up+the+Process+

By Lester S. Rosen, President of ESR

(First published on RecruitingTrends.com)

As the recession begins to slowly turn around, employers are naturally cautious about increasing the size of the workforce until it becomes clear that hiring additional full-time workers is justified. The solution traditionally has been to hire through staffing agencies so that an employer had flexibility to adjust to the ups and downs of the recovery. 

However, the notion that just because workers are on someone else’s payroll that they are not a businesses’ responsibility or problem is simply not true.

It is clear, in fact, that when a business hires temporary workers, the business assumes much of the same liability as when workers are hired directly. Although staffing agencies still have duties to pay wages and handle such items as reporting to appropriate agencies and workers compensation insurance, there are a host of potential employment law liabilities that are still the responsibility of the employer.

An employer can still be sued for sexual harassment, or for having a hostile workplace, or for discrimination regardless of whether the worker gets paid by the company, or paid through a staffing firm. That is because the temporary worker is still under the control and direction of the workplace. This falls under the legal doctrine of co-employment, where both the staffing vendor and the business have duties and obligations. 

For employers, the scope of their co-employment responsibility can even extend to liability for negligent hiring and negligent retention. The law is absolutely clear that if a temporary employee harms a member of the public or a co-worker, the employer can be just as liable as if the person were on the employer’s payroll.  Many employers have found out the hard way that unscreened or inadequately workers from a Professional Employer Organization (PEO) or staffing vendor can also cause damage. A business can be liable if, in the exercise of reasonable care, the business should have known that a temporary worker was dangerous, unqualified, or otherwise unfit for employment. An employer has an absolute obligation to exercise due diligence not only in whom they hire on payroll, but in whom they allow on premises to perform work.

No employer would dream of walking down the street and handing the keys to the business to a total stranger, yet many employers across America essentially do exactly that every day when engaging the services of vendors and temporary workers.

Part of the problem is that the word “screening” is used differently by staffing vendors and employers.  A staffing vendor will “screen” applicants to determine whether a candidate’s resume is a match for the job description.  For employers concerned with due diligence, and risk-management, “screening” means having a background check performed to determine whether the person is safe and qualified. 

Of course, in the event of a lawsuit where an employer is sued, the employer would likely turn around and blame the staffing vendor or PEO. However, the employer will still need to justify its own due diligence in how it selected and supervised the staffing vendor.

The PEO or staffing firm would likely blame the employer for failure to specify what was required. Although the eventual outcomes will depend upon specific facts, employers and staffing vendors can avoid these difficulties in the first place by clearly addressing who has what duties.

These are some of the issues that should be clarified when an employer and staffing vendor work together: 

• Which party is going to perform the background check – the staffing vendor or the employer?
• What is the screening protocol to be used? Ideally, employers should require a staffing vendor to utilize the same criteria used for their own W-2 employees.
• What Background Screening firm will be used? The employer needs to ensure that the staffing vendor utilizes a background screening agency that is experienced and qualified for the assignment and follows best practices, such as not offshoring data, not using home based operators, and not substituting cheap database checks instead of real criminal searches.
• Whose responsibility is it to actually review the Background Screening report?  There have been cases where staffing firms have found negative information but no one read the report or acted on it.  The negative information typically comes to light when the employer decides to make the worker permanent, and performs its own background check, only to discover that a crime or resume fraud was missed or not acted upon.
• In the event derogatorily or negative information is found, how are decisions to be made?  The use of automated pass/fail criteria by the staffing vendor are increasingly becoming a potential Equal Employment Opportunity Commission (EEOC) issue, since it can have the affect of discrimination against protected classes of applicants.  Another solution is to send anything of a negative nature to the business for a final decision on whether they want that person on the premises.  Some staffing vendors, however, take the position that since it is their employee, it is their decision.  The critical point is to work out the protocol in advance.
• Do the consent and disclosure forms for background checks reflect the roles of the parties?  Under the federal Fair Credit Reporting Act (FCRA), a business can request that the background release extend to the business so it can review the background report. However the background release must also clarify that the staffing vendor is the employer of record.
• Who is going to pay for the background checks? 
• Who is going to send out the required adverse action notices or conduct a re-investigation? 

The bottom-line: staffing vendors can avoid a great deal of difficulty if these issues are addressed and documented upfront so that everyone is clear on who has what responsibly when it comes to safe hiring.

For more information on background checks staffing vendors, co-employment, background checks, and lawsuits, please visit Employment Screening Resources (ESR) at http://www.esrcheck.com.

Source:

http://www.recruitingtrends.com/staffing-vendors-co-employment-background-checks-and-lawsuits

By Thomas Ahearn, ESR News Staff Writer

The New York State Office of Court Administration (OCA), which provides a New York Statewide Criminal History Record Search (CHRS), will raise fees for each CHRS to $65.00 from $55.00 effective July 1, 2010, according to information on NYCourts.gov.

As explained on NYCourts.gov, the OCA’s CHRS criteria “is strictly based on exact match of Name and DOB (variations of Name or DOB are not reported.) The search results are public records relating to open/pending and convictions of criminal cases originating from County/Supreme, City, Town and Village courts of all 62 counties. Sealed records are not disclosed. Town & Village criminal disposition data is limited.”

The NYCourts.gov website also provides a Criminal History Record Search FAQ page that answers many questions about the OCA’s CHRS including the following:

• How many counties are included in the New York Statewide search? All of the State’s 62 counties. Individual electronic county searches are not provided.
• What kind of information is included in the statewide search? The CHRS search process is based on locating an exact match of both the Name and DOB. The search results are public records relating to pending and disposed criminal cases originating from County/Supreme, City, Town and Village courts of all 62 counties. Sealed records are not disclosed. As of July 20, 2007, data relating to non-criminal offenses (e.g., violations, infractions) will no longer appear as part of the CHRS report.
• Why does OCA not provide information on violations and infractions?
  As a result of a recent case filed in a New York court, the Unified Court System has reviewed its policy regarding the contents of criminal history summaries that it provides to individuals and businesses upon their request and for a fee. The review has resulted in a change of policy to the extent that the summaries provided will report only convictions on charges that New York State law regards as crimes. Crimes are defined by New York State law as including misdemeanors and felonies only. Convictions on offenses

For more information and FAQs about the OCA’s CHRS, visit http://www.nycourts.gov/apps/chrs/ and http://www.nycourts.gov/apps/chrs/faqs.shtml.

For more information about employment screening and background checks, as well as the latest updates on changes in fees for criminal records searches, visit Employment Screening Resources (ESR) at http://www.esrcheck.com.

Sources:

http://www.nycourts.gov/apps/chrs/

http://www.nycourts.gov/apps/chrs/faqs.shtml

By Thomas Ahearn, ESR News Staff Writer

According to a report by the Wall Street Journal on WSJ.com, insurance conglomerate Marsh & McLennan Cos. Inc. has agreed to sell its corporate-intelligence unit Kroll to global security firm Altegrity Inc. for $1.13 billion.

Altegrity started in 1996 as U.S. Investigations Services (U.S.I.S.) when the government privatized the business of security clearance background investigations, WSJ.com reports, and in 2007 Providence acquired the company for $1.5 billion and renamed it Altegrity. Altegirty also owns another screening firm called HireRight, according to a story on DailyFinance.com. 

In 2004, Marsh & McLennan paid $1.9 billion in cash for Kroll, a company that helped pioneer the corporate investigations and security business, but WSJ.com reports that the insurer has sold off smaller pieces of Kroll recently to focus on its insurance and consulting businesses, with the sale to Altegrity completing the divestiture.

Altegrity, a company that performs U.S. government employee background checks and consults foreign governments on counterinsurgency techniques, is owned by private-equity firm Providence Equity Partners, according to WSJ.com. 

For more information on employment screening and background checks, visit Employment Screening Resources (ESR) at http://www.esrcheck.com.

Sources:

http://online.wsj.com/article/SB10001424052748703303904575292322037231554.html

http://www.dailyfinance.com/story/investing/kroll-mmc-altegrity/19506027/