Small Business Today Magazine NOV 2014 EXHIBIT NETWORK | Page 39

EDITORIALFEATURE How to Avoid A Million Dollar Hiring Mistake By Paul Marcus I n recent years, the number of negligent hiring lawsuits filed against employers has increased.  These lawsuits are normally filed by a third party who is injured by your employee.  Most claims are made charging that the company (you) did not do the proper due diligence of conducting a thorough background check before hiring the employee, and if a proper search had been done, the employee would not have been hired.   By not performing a complete and comprehensive background check, you are leaving yourself and your business open to the following: • Unsafe business environment • Embezzlement and dishonesty • High employee turnover rate • Workplace violence • Negligent hiring lawsuits The average cost to employers of a negligent hiring lawsuit is $1 million and can exceed $40 million.  In addition, 79 percent of negligent hiring lawsuits are lost by the employers.  Following the recommendations below will assist you in setting up an effective screening process. To run a complete and thorough background check you must do the following: 1. Validate the social security number. 2. Run a good alias multi-jurisdictional criminal check as a supplemental check.  (Some sites will advertise these as a “National Check” but never run these as a stand-alone search. 3. Check every county the person has lived in for the past seven to ten years under all names.  This check should be done onsite at the county seat of the jurisdiction. 4. Check the Federal Criminal Records Database. 5. Do an Employment and Education Check on the applicant. 6. If needed, run a Motor Vehicle Records Check. 7. Run a reference check on the applicant.   Before the interviewing process starts, the company must create a job description clearly defining the essential function of the job.  Having a clearly defined job description can provide legal protection for claims of discrimination or noncompliance with the ADA.  Below are seven critical items that every application needs as suggested by the Safe Hiring Audit written by Mike Sankey and Les Rosen: 1. The application needs to clearly state that there will be a background check or a background check will be performed. 2. There should be the broadest possible language asking about convictions and pending criminal cases. 3. A statement which says that any misstatements or omission of material facts may result in discontinuing of the hiring process or termination of employment. 4.  The form should clarify that a criminal conviction is not automatic grounds for rejection. 5. The form should indicate the applicant consents to a background check being done. 6. The application form must ask for all employment for the past 7-10 years. 7. The application form should ask for addresses for the past 7-10 years. It is also very important to ask the correct questions in the interviewing process.  In the book, “The Safe Hiring Audit”, the authors suggest using behavior-based questions and open-ended questio