If you're launching or growing your company and feeling a little desperate for tech talent, you may be tempted to hire first and think later. Bad move. According to the Society for Human Resource Management, a huge number of candidates -- at all levels -- lie on their résumés. More than half the companies surveyed by the organization in 1998 found that job candidates had falsified information about their previous employment.
John Putzier, president of FirStep Inc., a human-resources consulting firm in Prospect, Pa., says free-form job titles make matters even more confusing. "If I'm interviewing a 'guru,' is she a project manager or just a wacko?" Putzier says.
The worst-case scenario, he says, can lead to a negligent-hiring suit. "If someone has been convicted of assault, and you could have found that out and didn't, you could be putting the lives of employees, customers, and clients in danger," he warns.
Fortunately, there's a way to protect your company. First, make any job offer contingent on a background check. Then, to save time, hire a screening service to do the checking for you. Third-party services, like Laborchex, in Jackson, Miss., can turn such requests around in a matter of hours or a few days at most.
Laborchex, which took its service online a year ago, now plays Sherlock Holmes for 1,000 clients. For an average cost of $70 a candidate, Laborchex staffers poll the applicant's past employers and gather driving and criminal records, credit reports, and other publicly available information.
The snooping is all aboveboard, says Laborchex owner and president Rene Barbee. "We make sure we have a legal release from the applicant before we do the review," he says.
However, hiring an outsider to do your background checks is potentially perilous, says lawyer Julie Moore, president of Employment Practices Group, a training and consulting company in Windham, N.H. "A person can sue you for what your independent contractors do," she says.
So if you do hire a background checker, cover your you-know-what. Ask for references and a copy of the company's insurance policy. Make sure the company complies with the federal Fair Credit Reporting Act. Finally, says Moore, get an indemnification contract. "You want to make sure the background-check firm will pay the defense costs and any settlement if it was their wrongdoing that brought on the suit," she says.