We talk a lot about how companies can get in trouble for their procedures when conducting background checks. Things like gaining applicant authorization before conducting a background check, or proper adverse action procedures to keep your company safe from costly lawsuits. We usually don’t discuss how an employment background check is one of the best ways to keep employees from doing wrong. Using background checks is also a great way to protect your company from lawsuits if you employ someone who does intend to do wrong.
Consider the many scandals surrounding Wells Fargo employees opening fake accounts. The banking giant is set to pay $185 Billion in fines. There are many examples of companies that failed to do their due diligence in hiring, in some cases failing to confirm a potential employee’s right to work in the US. Failing to do that work is not an excuse and it’s important form I-9 procedures like keeping the documents on file are followed. Other cases of fraud involve companies hiring individuals whose goal is to commit fraud. The only reason companies get sued for negligence is because they fail to do their due diligence.
In his book Organizational Wrongdoing, Donald Palmer PhD notes that one of the causes of the 1980s loan fraud was a decrease in investigating the people being hired into the industry. This caused known felons to be hired and resulted in widespread fraud. Palmer goes on to indicate there are two causes of this sort of organizational wrongdoing. One is that the company intends to hire fraudsters and that they specifically attract those individuals. The other is that the company does not intend to do wrong, but fails to do their due diligence in hiring employees or keeping employees honest.
There are many other ways wrongdoing can start in a company and not all cases of wrongdoing can be avoided. However, companies must protect themselves by doing their due diligence when hiring new employees or they open themselves up to lawsuits. Should you hire an employee who passes a background check and other hiring procedures you have done the most you can to ensure that employee is a safe and valuable resource for your company. If you don’t use all these tools to ensure your employees are safe, you risk hiring individuals who may intend to steal from or otherwise harm your company or your customers. Worse than that if they do succeed in causing harm your company can be sued for not doing everything they could have to ensure this employee was safe.
HireSafe’s suite of screening solutions was created to keep your company safe from employees that may not fit your organization and from potential lawsuits. These services are your best defense from illegitimate employees and lawsuits.