New background check survey reveals security issues in the screening process

As a security professional, it probably doesn’t surprise you that 72 percent of the security and HR professionals responding to a recent HireRight Employment Screening Benchmark Report survey said that through background screening they discovered issues with applicants or employees that wouldn’t otherwise been found. Additionally, 88 percent said screening uncovered candidates who lied on their resumes or job applications.

Background checks and drug testing are critical security steps to help ensure that the most qualified employees are hired. Over the years, the benchmarking survey respondents have shared some whoppers of excuses made by their job applicants who failed their background checks. For example, one respondent recently had a candidate who’d tested positive for drugs claim that he was in a wheelchair and must have rolled over some marijuana and that’s how it got on his hands. These types of results have made employment screening virtually ubiquitous among larger organizations, and rapidly growing as a practice among mid-size and small companies.

Respondents of the 2014 HireRight Employment Screening Benchmark Report cited benefits from screening included better quality of hires (56 percent), more consistent safety and security (52 percent), improved regulatory compliance (48 percent), and more. But what screening practices do companies actually employ, and where are they leaving potential gaps that could concern security executives? The Benchmark Report provides some of these insights.

Increased Hiring Predicted

More than 3,000 respondents confirmed what most employers suspect – that the hiring outlook is generally optimistic. Seventy-one percent of companies expect organizational growth and nearly one-quarter expect growth of six percent or more. This upbeat outlook, however, puts pressure on human resources and security departments not only to find qualified candidates, but also to get them screened and hired as quickly as possible. Reducing the time to hire was a top concern for 47 percent of respondents. At the same time, nearly one third of respondents said they are taking steps to improve the candidate experience as part of an overall plan to attract and retain top candidates. The potential downside of these hiring pressures is that steps in evaluating and onboarding job applicants can be skipped or compromised, which in turn might render the organization more vulnerable to litigation, fraud, or workplace violence.

Establish and Re-Establish a Policy

Often a best practice in employment screening is for an organization to establish a screening program and policy with input from all major constituents, particularly human resources, security, and legal. The well-developed screening policy helps assure that screening, testing, and verification is being employed in a fair and consistent manner in accordance with the Fair Credit Reporting Act (FCRA), all other applicable laws and regulations, and the Equal Employment Opportunity Commission’s (EEOC’s) guidelines. Such a policy not only can help ensure that step-by-step procedures are established and maintained, but also can help protect an organization against potential discrimination liability. However, what’s often overlooked is that a key to an effective screening policy and program is ongoing review and improvement since requirements and regulations change frequently. Additionally, new technologies and screening tools emerge that can help organizations improve time-to-hire, accuracy, and efficiency. Notably, nearly 40 percent of survey respondents did not anticipate making any improvements to their policies in the next year – a potential red flag for any security department.

Best Practice: Consult with your employee onboarding teams and legal counsel to establish a written policy that’s appropriate for your organization and that identifies what information will be checked and how that information will be used in the hiring decision.  Periodically review the policy to ensure it’s still appropriate and compliant with all current laws and regulations, and adjust the program and systems as needed for process and compliance improvement.

Improving the Candidate Experience

For most security professionals, minimizing risk exposure to a company ranks as their number one priority. With employment screening, that objective generally must be balanced with helping the organization quickly and effectively onboard key talent. Since many survey respondents indicated an anticipated increase in hiring this year, the competition for talent is expected to be heating up. Organizations continue to cite talent acquisition as a core business challenge. To improve their success in the war for talent, progressive employers are putting greater emphasis on improving the candidate experience to help attract and hire high-quality talent. The repercussions of a poor candidate experience can be significant, including losing top candidates, damaging an organization’s brand, and negatively impacting the bottom line. It therefore is not surprising that 28 percent of survey respondents plan to improve their candidate experience in the next year.

Best Practice: Understand how the background screening, hiring, and onboarding processes impact the candidate experience, and how procedures and systems can be improved toward that end. Technology solutions continue to offer new ways to manage screening, such as integrating background screening systems into HR recruiting systems and security badging and access control systems. For example, security management can set up access control software so that it won’t allow a company badge to be issued to a new hire, or even a vendor or temporary employee, until that person has cleared the appropriate background check. In this way, organizations can leverage technology to better expedite and control the hiring process, and provide a more seamless experience as the candidate transitions to an employee.

Neglecting Drug Testing

One important security gap revealed by the Benchmark Report is that a large number of employers (42 percent) are not conducting drug and/or alcohol testing. Drug and alcohol testing is an important part of screening, both before and after hire, and neglecting to test employees can leave organizations vulnerable to potential safety and security risks, decreased productivity, and increased employee absenteeism.

Survey respondents indicated that when candidates fail a drug test, they often come up with some of them most outlandish explanations and excuses. For example, one respondent’s candidate claimed, “I buy shampoo from China, and I think there are opiates in that.” While another respondent’s candidate seemed to be attempting to be more honest when he said, “I should not have used another person’s urine.”

The emergence of laws legalizing marijuana for medical or recreational use raises new questions for employers. Currently 20 states and the District of Columbia legally allow some form of marijuana use¹. Despite this, only 15 percent of respondents have instituted a medical marijuana policy and 9 percent plan to, leaving 76 percent of respondents who indicated that their organizations do not have a policy on medical marijuana.

Best Practice:  Consider conducting drug testing before hire and on a periodic and random basis (where and when allowable under applicable law) during an employee’s lifecycle in an effort to maintain a drug-free work environment.

Contingent Workforce Screening

The Benchmark Report revealed that the majority of companies are running a critical risk in terms of their non-employee workforce, which can include contingent workers, temporary or contract staff, volunteers, and vendor or partner employees, and which can represent a significant portion of a company’s workforce. According to the Benchmark Report, only 32 percent of respondents conduct employment background checks on their non-employee workforce, indicating that the vast majority of organizations do not screen this portion of the workforce at all.

Of those that do screen non-employees, 65 percent screen contingent, temporary, or contract workers, 25 percent that they screen volunteers and 10 percent screen vendors. As the non-employee workforce may have the same physical, systems, and intellectual property access as employees, they can potentially pose many of the same risks as employees. An employer generally is equally likely to be sued for the negligent acts of its contingent worker as those by its full-time employee, and as such the failure to screen the non-employee workforce can represent a significant gap in an organization’s background screening process.

For example, in 2004, in Solomon vs. Developmental Systems Inc., American Habilitation Services Inc., and The State of Arizona, a jury awarded the parents and estate of Ilana Solomon the sum of $45.5 million for negligent hiring. The State of Arizona (and/or DDD under Arizona law) contracted with a service provider to provide 24-hour care for Solomon. Solomon, a developmentally disabled person, was left alone in a filled bathtub at the group home resulting in her drowning. The defendants admitted liability for negligent hiring, training and supervision when they recommended a caregiver who had been previously terminated, designated ineligible for rehire, and was on probation when Solomon was placed in her care.

In the case of vendor and staffing company employees, some organizations prefer to conduct background checks on these individuals directly. Others have their vendors conduct background checks, but require that they screen to the same standards and protocols as the organization and include these requirements in their contracts.

Best Practice: Ensure the background screening program includes processes and protocols for screening non-employees. One approach is to set up the system whereby access badges are not issued to a non-employee until the background check has been cleared.

Global Screening

Another very common screening mistake can be neglecting to conduct global screening. In an increasingly global marketplace, and in an environment with a shortage of qualified talent, organizations are recruiting more applicants who may have lived, studied, or worked globally. However, only 15 percent of survey respondents indicated that their organizations performed global background checks to verify international education, employment, and criminal histories. The global screening rate is higher for large organizations with 4,000 or more employees, but at only 33 percent, it’s still a minority, and this means that many companies can be putting themselves at increased risk by not conducting these verifications. For example, one candidate for an engineering position in the U.S. stated on his resume that he had an electronics engineering degree from a well-known university in India and he provided a certificate as proof of his degree. When the verification was conducted, it was revealed that he had attended the school, but had failed most of his subjects and the certificate he furnished was a fake.

Best Practice: Create a global screening program to verify the background and experience of employees who have lived in other countries. The program should take into account the wide variety of laws and regulations in other countries regarding what data can be collected and how it can be used in employment, and the program also should be sensitive to the cultures of the different countries where the organization is conducting screening.

Recurring Screening Protocols

While the Benchmark Report demonstrates that most employers are conducting screening upon hire, the report also indicates that some organizations also re-screen existing employees after hire as a best practice or because applicable regulations mandate such checks. For example, verification of license renewals may be regulated in industries such as transportation, health care, and financial services where active licenses in good standing are required. For other non-regulated organizations, however, it’s often an industry best practice to periodically re-screen employees because it can help reduce long-term risk by keeping employers well-informed of any new issues that may have emerged through the tenure of the employment relationship.

The Benchmark Report revealed that only 20 percent of organizations re-screen employees after hire, and of those, almost one-third (29 percent) re-screen existing employees only when a status change of some type has occurred. Additionally, 29 percent re-screen contingent and/or contract workers and 23 percent re-screen temporary workers. A very small number, nine percent, re-screen volunteers and/or unpaid workers, while six percent re-verify vendor representatives. Periodic recurring screening can be a best practice since staying informed of employee conduct inside or outside of the workplace can help an organization further mitigate risk and protect against negligent retention lawsuits.

Best Practice: Security executives should consider instituting policies for ongoing screening of existing employees, such as when employees change positions in the company, and otherwise every two to three years.

The Benchmark Report was based on extensive surveys of more than 3,000 security and human resources professionals. The results of this survey can help employers better understand common pitfalls and identify areas in their screening programs that could be improved to align with industry best practices to mitigate risk to help ensure a better qualified workforce and a safer and more secure workplace.

About the Author: Rachel Trindade is the vice president of marketing at HireRight. She is responsible for marketing, field operations, and business development, focusing on branding strategy, market analysis, and demand generation execution leading to new customer acquisition. The complete Benchmark Report can be found at www.hireright.com/benchmarking. More information can be found at www.hireright.com.

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¹ http://www.ncsl.org/research/health/state-medical-marijuana-laws.aspx