Growing Concern of Wrong Hires

Across the United States there is a growing concern by employers and human resource professionals in respect to wrong hires and the costs continue to increase while the positions remain vacant and projects remain delayed. But, do you really have any idea why you should implement a thorough screening and pre-employment process in your organization?
Do you know the cost of a wrong hire? For small companies a wrong hire can be responsible for organizational collapse, while the larger organizations can usually absorb the costs associated with the wrong hire. It is estimated the cost of a wrong hire is 1.5 times the annual salary of the position. This cost increases as the position goes higher in rank and management level.
It is important to conduct a proper background check because within the pool of talented applicants lies the potential for corporate espionage, criminality and those lacking capability to perform the duties of the position. Add to this the mandated I-9 compliance and verification task, which has been handed the employer by the United States federal government and you, have a large box of problems in respect to mis-hires and wrong hires, which are in addition to the already stated costs of doing business.
Incidentally, hurried recruitment coupled with improper screening can easily add to the high attrition rate in any given industry, which lends to increasing training costs and overall recruiting. Realistically, the damage caused to a smaller organization easily outweighs those in larger companies. For instance, project delays, loss of customers and clients, further recruiting are all considerations that contribute to the problem.

As adults, we learned growing up that honesty is the best policy, but is your company or human resource agency doing everything possible to make certain all applicants and potential new hires are providing accurate information. As an HR professional, employer, or anyone assigned responsibility in the hiring process, you recognize the necessity for accuracy of information in order to comply with governmental social security and wage reporting.
Still, there are other reasons why companies should do everything possible to weed out applicants who provide wrong or false, as well as those who knowingly fail to include certain types of information on applications. A study of potential applicants for new hire positions put through a pre-employment screening process may surprise you. Obviously, these results reveal that many job seekers have something they may be reluctant to put on an application.
+ 41.6% had a violation on record with the Department of Motor Vehicles.
+ 39.2% had bad credit, such as an account that went to a collection agency.
+ 26.4% had discrepancies in their résumés about past employment.
+ 8.3% had a criminal record.
+ 8.2% inaccurately reported their level of education.
+ 3.3% had tested positive for illegal drugs.
Source: InfoLink Screening Services
Surprisingly, it appears to be the non-criminals who are misrepresenting themselves to potential employers, given these results reported. While the entire hiring process is critical to any organizations success, it may in fact present an abundance of additional tasks that are better handled by outsourcing the work to a competent company.
Clearly, this explains why Fortune 500 companies and even smaller organizations have looked to online resources in screening efforts. Clearly, there is an absolute need for competency and accuracy in reporting by these online screening companies and it is yet unclear who will check up on those organizations that are now supporting employers but we feel with due diligence an employer can make an appropriate choice from those already in place to assist.
Of course, this is an industry, which has a great deal of growth ahead and will likely continue to grow as the business world becomes more and more competitive. Employers and human resource professionals can no longer afford to hire without background checks and other types of screening. In absence of this information, a potential for additional burden and higher costs of doing business awaits.
The risks of a wrong hire easily exceeds the cost associated with pre-hire screening and background checking. In fact, the potential for litigation can easily escalate the situation from a difficult hiring decision or process into what can become an ugly termination process that places the entire organization or company at risk. One word of caution here, whatever you do in respect to the hiring and screening of candidates, do it across the board. This will diminish any potential and possibility of discrimination in hiring and protect your ass at the same time.