As part of a series of webcasts for the Institute for Human Resources (IHR) Certification Program from HR.com, safe hiring expert Attorney Lester Rosen, CEO of nationwide background check provider Employment Screening Resources (ESR), will present a one hour webinar on the topic of ‘Legal and Effective Reference Checking and Education Verification’ on Thursday, August 25, 2011 from 1:00 PM to 2:00 PM ET (10:00 AM to 11:00 PT). To register for this webcast, which is free to HR.com members and approved for 1.0 General credits through the HR Certification Institute (HRCI), visit http://www.hr.com/en/webcasts_events/webcasts/upcoming_webcasts/legal-and-effective-reference-checking-and-educati_gpvaargk.html.
To help some frustrated jobseekers succeed in the current job market, one company is offering false job references – complete with job titles, start dates and end dates, and salary – to people seeking employment who are willing to pay a fee plus a monthly subscription. This service that offers phony references from real “Reference Providers” and work histories from “Virtual Companies” is why background checks of job applicants, particularly past employment verifications, have become so vitally important for employers today. Continue reading
While most employers agree knowing the work history of the employees they hire is an essential part of their decision making process, conducting past employment verification and reference checking can often be a very frustrating task since many employers, on advice of legal counsel, have a “no comment” policy that allows only verification of the most basic information such as job titles and the start and end dates and job titles of former employees, according to a ‘Special Report: Obtaining Employment References©.’ Continue reading
With a recent report revealing an astounding 48 percent increase worldwide in the number of known fake diploma mills in the past year, and a 20 percent increase in the United States alone, education verifications where employers verify the academic achievements and certifications claimed by job applicants have taken on an important role in employment screening background checks. Continue reading
Background check expert Lester Rosen, an Attorney at Law and President of nationwide background screening provider Employment Screening Resources (ESR), will present an educational session at the 2011 Society for Human Resource Management (SHRM) Annual Conference and Exposition titled ‘Legal and Effective Reference Checking and Education Verification.’ The session will take place on Wednesday, June 29, 2011 from 11:30 a.m. to 12:45 p.m. at the Las Vegas Convention Center in Las Vegas, Nevada. For more information, follow this link. Continue reading
Attorney and safe hiring expert Lester Rosen, President of Employment Screening Resources (ESR), a nationwide background screening provider accredited by The National Association of Professional Background Screeners (NAPBS), will present a session, ‘Legal and Effective Reference Checking and Education Verification,’ at the 2011 Society for Human Resource Management (SHRM) Annual Conference and Exposition on Wednesday, June 29, 2011 from 11:30 a.m. to 12:45 p.m. at the Las Vegas Convention Center in Las Vegas, Nevada. For more information about the session presented by ESR President Lester Rosen, please visit:
http://www.esrcheck.com/Newsletter/ESR-Speaks/Legal-and-Effective-Reference-Checking-and-Education-Verification-72/. Continue reading
The need for international background screening – where firms provide employers with criminal background checks, past employment and education verifications, and reference checks on people who have spent time outside the U.S. – has been demonstrated by a recent report on the rise in fraudulent and dishonest claims in resumes by job applicants in China. Continue reading
By Thomas Ahearn, ESR News Blog
A recently published new study on employment background screening has found that organizations using automated tools for background checking, employment and education verification, and reference checking experienced 60 percent better quality of hire compared to those without employment background screening solutions in place.
The new report from Aberdeen Group, a Harte-Hanks Company – “Employment Screening: Mitigating Risk, Driving Down Cost” (September 2010) – is based on over 400 survey respondents to Aberdeen’s 2010 Talent Acquisition Strategies study and looks at the components of employment background screening that are most widely used and how these components impact hiring performance.
The report found that employment background screening is fundamental to best-in-class performance. When asked what kinds of technology they currently used as part of their talent acquisition process, over three-quarters (78 percent) of survey respondents cited the use of employment background screening solutions. The report also found that companies using employment background screening were 43 percent more likely to achieve “Best-in-Class” companies, which Aberdeen Group defines as the top 20 percent of performers along the following categories:
- First year retention of hires.
- Percentage of new-hires that were the top-choice candidate.
- Average year-over-year decrease in time-to-fill vacant positions.
Overall, the research revealed that among Best-in-Class companies the most utilized employment screening technology was employment background screening, with 83 percent using employment screening such as background checks and drug testing.
As for the most common aspects and elements of an employment background screening solution, the Aberdeen Group found that out of all of the survey respondents:
- 88 percent performed domestic criminal background checks.
- 87 percent performed previous employment/education verification.
- 72 percent performed reference checking.
- 60 percent performed drug screening.
The use of employment background screening has shown an impact on overall quality of hire, with an increase of 7 percent year-over-year for organizations using employment background screening as compared to a 5 percent average increase among those that did not use employment background screening.
The need for criminal background checks and employment and education verifications is key when it comes to risk inherent in hiring, the Aberdeen Group survey found, since even seemingly ideal candidates may have issues unearthed via background checks that make them undesirable for hiring and prospective employees may be included to stretch the truth about their educational backgrounds or previous employment in the current ultra-competitive job market.
The Aberdeen Group survey also shows these two employment background screening elements – criminal background checks and employment/education verifications – are even more important in the financial services, healthcare, and public sector environments:
- Financial services: 93 percent performed criminal background checks and 97 percent performed employment/education verifications.
- Healthcare: 94 percent performed criminal background checks and 94 percent performed employment/education verifications.
- Public sector: 100 percent performed criminal background checks and 83 percent performed employment/education verifications.
Lastly, when it comes to selecting a partner for providing employment background screening, the Aberdeen Group survey found that the speed with which the process was completed (62 percent of respondents) and the accuracy of the results (54 percent of respondents) were far and away the top criteria.
By Lester Rosen, ESR President
At the end of Part 1 of this blog, the question arose from some hiring managers as to whether automated reference services like Checkster could replace the type of employment verifications performed by background firms.
The short answer is no. Although services from Checkster and similar firms can be extremely valuable, they are done earlier in the time line of the hiring process. Background checks are done near the end of the time line. Traditional background checks and Checkster type services can compliment each other, but they serve different purposes. They are different tools for different functions.
First, Checkster type services occur in the talent sourcing and selection stages. Background checks, by comparison, occur only AFTER a tentative decision has been reached. In other words, Checkster type services are used to decide who to focus on out of a pool of candidates, while a background check seeks to assist an employer in exercising due diligence by examining if there is any reason NOT to hire someone that an employer has potentially targeted for employment.
Although a Checkster type service will obviously also help to eliminate some candidates from consideration in the early stages based upon the results of the third-party reference and assessment provided to employers, there is a fundamental difference between an email-based reference service and the role of a background firm.
The whole idea behind due diligence as a legal defense is independent factual verification.
For example, background firms do not take the applicant’s word for whether the past employer even existed. A background firm will typically independently verify that the past employer existed as well as verify that the phone number is real, independent of what the applicant contends. Even if past references are contacted for evaluation purposes by email, the task of verifying the truthfulness and accuracy of the employment history still requires a screening firm to independently obtain information from past employers.
Another advantage to an employer utilizing traditional background checking techniques is that the employer has a powerful argument in front of a jury in the event of a lawsuit for negligent hiring that they excised due diligence. The background firm’s efforts to manually verify the existence of a past employer, and then to verify that the applicant in fact worked there, is one of the most important and powerful due diligence tools in the employment process. By knowing where a person had been, an employer is able to eliminate any unexplained gaps in employment, and to also know where to search for potential criminal records. It is a well-known fact among due diligence professionals that verifying where a person has worked is just as important, and in some cases more important, than checking for criminal records. A criminal record can occasionally slip through the cracks, but an unexplained gap in employment creates a red flag that may prompt an employer to do further research.
If an employer is sued for negligent hiring, it is also questionable whether an employer can demonstrate due diligence if they let job seekers pick and choose which references were contacted. There is also the possibility of a fake or set-up reference, or an applicant creating a fake identity, and having the bogus ones “verified.” Checkster certainly takes step to minimize the possibility of fraud. However, in the final analysis, there is no substitute for the hard work of manual checks. By manually verifying the existence of past employers, and verifying dates of employment in order to reveal gaps in employment, an employer is taking the final due diligence steps needed before making a hiring decision final.
Employment verifications by a background firm are typically conducted in a call center environment in high volume by callers who are used to verifying factual information about an applicant’s employment history. Given the highly sophisticated software and databases as well as expertise that screening firms bring to the process of manual verification, a substantial number of such checks are completed within three working days.
The bottom-line is risk management. Although these email assessment tools are an excellent means of providing an in-depth assessment about a candidate during the decision-making stage, the traditional background check complement them for the final candidates and provides the demonstrable due diligence that can be used as a legal defense if there is a negligent hire lawsuit.
Conclusion: In the never ending efforts by employers to identify candidates that are a good fit and qualified, a new internet tool has been developed to allow employers to utilize email to accelerate the process of obtaining references and assessments from past supervisors and others that know the applicant. Questions have arisen as to how such a tool is related to the background screening process that employers utilize in order to exercise due diligence. In fact, the two processes, although related in some ways, are entirely separate workflows that occur at different times in the hiring process and for different reasons.
Internet based references can be utilized by an employer to whittle down the field of candidates and to help an employer decide whom to hire. Background checks occur after an employer has made a tentative decision, and needs to determine whether there is any reason NOT to hire an applicant.
When past employment checks are done as part of the background check process, the purpose is to verify that the employer actually exists and to independently verify the core details of employment, such as job title and dates. In other words, there is a large difference between obtaining references, which are a qualitative measure of an applicant’s fit and abilities, and factual verification of an applicant’s employment history, which is a critical due diligence task. Both processes can be useful in the quest to select the best candidates to hire and to avoid bad choices.
For more information about background checks and employment verifications, visit Employment Screening Resources (ESR) at http://www.ESRcheck.com.
By Lester Rosen, ESR President
Identifying applicants that are the right fit and have the right knowledge, skill, and abilities to do the job is a perennial challenge for employers. In pre-industrial society, the problem was generally solved by either hiring someone that the employer knew, basing the hiring decision upon a personal recommendation, or using an apprenticeship type program that gave an employer a great deal of insight into who they were hiring.
While these approaches are still in use today, it is no longer possible to match millions of applicants and jobs based upon the employer having a pre-existing relationship with applicants. Additional approaches such as using the internet to find good candidates have developed. Since every time an employer hires a stranger, it is somewhat of a “leap of faith,” employers need tools to make good decisions. Employers are seeking ways to determine who the person really is and what the person has done in the past, as predictors of how they will perform. Although past is not always prolog, past performance says a great deal about how a person may be expected to perform in the future. Employers also want a means to “look under the hood” at applicants rather than just accepting them at face value.
Every hire represents a significant investment and – simultaneously– a significant risk. A bad hire can result in a legal and financial nightmare. Bad hires cost an employer a great deal in terms of time wasted recruiting, hiring and training, and searching for a replacement, not to mention the job not being done. A bad hiring decision can also lead to litigation for negligent hiring, if the new employee turns out to be unfit, dishonest, or dangerous, and someone is harmed. To add insult to injury, when the bad hire is eventually terminated, employers need to deal with the possibility of a wrongful termination lawsuit even if the firing is entirely justified.
In order to evaluate the various hiring tools, it is essential to understand that the hiring process occurs on a time line. Each step of the continuum carries its own set of legal implications. Matching your hiring tools to the proper stage of the time line is key to sorting out the best applicants AND to helping prevent a bad hire. The available tools of the hiring process can roughly be divided in seven stages as follows:
- 1. Sourcing stage: This is the process of gathering potential applicants through a variety of means that can include inbound applications from job boards, websites, newspapers, or outbound efforts, such as recruiters seeking passive candidates;
- 2. Preliminary screening stage: In order to narrow down the applicant pool, there is a preliminary screening primarily based upon the applicants’ self-stated qualifications, conveyed by the resumes or applications or newer tools such as video websites;
- 3. Assessment stage: This stage can include the interviewing process to further narrow down the field of candidates, as well as numerous other assessment tools, ranging from objective testing to references from past employers or supervisors, or various other testing methods;
- 4. Decision process stage: Here, the employer has narrowed the pool to one, two, or three finalists and is moving toward a conditional job offer based upon an internal decision-making process;
- 5. Background checking stage: At this point, either a conditional job offer has been made or is contemplated, and the employer needs to exercise due diligence, typically through a background screening firm, to determine if there is any reason NOT to hire the candidate. The emphasis of a background screening firm at this point is a factual verification of details such as job title and dates;
- 6. The post offer/pre-hire stage: This is where an employer is able for the first time, if they so choose, to address such areas as pre-employment physicals;
- 7. The post hire/on boarding stage: This is where an employer, for example, can complete the form I-9 process.
These seven stages illustrate a clear demarcation between efforts pointed at deciding who to hire, and efforts directed at deciding who NOT to hire. This is where evaluation of the pros and cons of the hiring tools comes into play.
Background checks, for instance, are of little assistance in stages 1 through 5. That is because a traditional background check is only performed on finalists, where, by definition, an employer has already made a tentative decision to either hire or place that person in the group of finalists. Background checks are used to decide who NOT to hire.
Are there other tools available besides background checks for sorting through the pool of applicants? Yes. One of the most interesting new tools is for online automated reference checks and assessments.
An example is the offering of Checkster, a company founded by a veteran in the talent management sector. Job candidates select references, such as former supervisions and co-workers, who then get an assessment request emailed to them. It’s self-service. Eliminated are the time spent making phone calls and waiting for and tracking responses. The references simply fill out an email questionnaire. The questionnaire itself is a scientifically designed assessment instrument that gives a fresh look at the applicant and contains a number of state-of-the-art validation tools. The results are communicated back to a recruiter or hiring manager in a graphical and intuitive report. Although there are others competing in the same space, Checkster clearly has thought through and designed the process from both the assessment and talent management point of view.
The end result of using such a tool is that the reference can quickly respond to an email, and time is not wasted on playing phone tag or managing follow-ups. The employer obtains a candid assessment because the person giving the reference is advised that the actual scores are confidential. Through Checkster’s processes, the email evaluations provide a scientific assessment of what is “under the candidate’s hood” – thus increasing the employer’s odds of making a job offer to the best candidate.
However, the question has arisen from some hiring managers: “Can services like Checkster replace the type of employment verifications performed by background firms?”
For more information about background checks and employment verifications, visit Employment Screening Resources (ESR) at http://www.ESRcheck.com.