The document discusses pre-employment screening and background checks as a form of risk management for employers. It notes that 6-12% of applicants have a criminal record and 4-16% will test positive for illegal drugs. The best sources of information for background checks are the county courthouse for criminal records and using an address history report. Drug testing improves the bottom line by making employees less likely to be absent, late, or file workers' compensation claims. Employers must disclose background checks to applicants and allow them to dispute incorrect information.

1. Don’t Hire Your Problems
A Simple, Cost Effective Approach to Pre-Employment Screening
John Pate - LS Screening

2. Today’s Webinar
1. Pre-employment Screening is Really
“Risk Management”.
2. Where the Best Information is and How
to Access It.
3. Why Drug Testing Improves Your
Bottom Line
4. Applicant Rights and Employer
Responsibilities

3. Pre-Employment Screening is
Risk Management
What Are Your Risks?
•Financial: Will new hires stay long
enough to justify the cost of
hiring them?
•Environmental: Will they “fit in”?
•Reputation: Can they do the job?

4. One way to go…
Now Hiring: Losers

5. When it comes to hiring, no one has
a crystal ball so remember…
The best
predictor of
future behavior
is past behavior

6. How Can You Learn About Past
Behavior?
• Consistent Interviewing
• Knowledge and Skills Tests
• Background Checks

7. Let’s Meet Your Potential
Workforce
• 6 -12% have a criminal record
• 4 -16% will test positive for illegal drugs
• 25 – 35% will have someone else’s
name associated with their SSN.

8. The Perfect Interview Question
“Is there anything you haven’t told me that, if I knew, would cause me not
to hire you?”

9. The Question Not Asked Can
Lead to Negligent Hiring
• “Negligent Hiring occurs when, prior to
the time of the employee is actually
hired, the employer knew or should
have known of the employee’s
unfitness” (Garcia v Duffy – 1986)
• Employers must do what is “reasonable”
to check applicant’s past. Courts have
decided a basic background check
meets the standard.

10. The Cost of a Bad Hire
• Conservatively – 20% of the annual
salary
• For a minimum wage employee - $2900
Let’s do the math
10 people hired/termed in same year
Costs $29,000

11. What Can You Do?
At a minimum:
• Check all applicants for criminal and sex
offender records
• This can be done for approx. $25 and
takes 1-3 business days.

12. The Alternatives
• $25 for a background check
• $2900 – minimum cost of a bad
hire
• $1.6 million – average settlement in
a Negligent Hiring Lawsuit in 2001
(SHRM)
[End Part 1]

14. Where is the Best Information?

15. Where is the best information?
1. In 2001:
– 44% lied about work histories
– 41% lied about their education
– 23% falsified credentials
2. Don’t believe everything the Applicant tells
you – even their name, SSN, date of birth or
where they’ve lived or worked.
3. (Some) Applicants lie.

16. Trust But Verify
4. The people you want to avoid – serial
offenders – know how to “game the
system” by altering their information.
Even the slightest change can allow
them to slip through

17. Who Has the Best Data?
5. Go to the “Source”
– Two levels of records: State and Federal
– The County Courthouse is the genesis for
all state criminal records.
– The “National Criminal” file is a marketing
ploy and doesn’t exist.
– Use an address history report to determine
where you will search.
– Ah… The Texas DPS Database

18. Where is the best information?
5. Assume an average of 2-3 business
days to complete the process
6. Nine Words about databases
1- Fast
2 - Inexpensive
3 - Inaccurate
4 - Incomplete
5 – 9 - Not Compliant with Existing Laws

19. How Do I Figure All This Out?
• Partner with a licensed, insured
company to provide this service – your
provider should reduce your liability, not
increase it.
• Read the fine print….
[End Part 2]

21. Why Drug Testing Improves Your
Bottom Line
• First – let’s admit to a general feeling of
“discomfort” associated with drug
testing
– Some Employers think it’s too personal
– There’s a bit on “ick” factor
– Social attitudes appear to be softening
towards marijuana – which accounts for
approximately 50% of all positive results.

22. Why Drug Testing Improves
Your Bottom Line
• DOL says drug using Employees are:
– 2.2 times more likely to ask for time off/leave early
– 2.5 times more likely to be absent
– 3 times more likely to be late
– 3.6 times more likely to have an accident
– 5 times more like to file workers comp claim
– 2 times more likely to change jobs
– Function at 67% of their capacity

23. How much better would your life be if
all your employees were:
• Always on time
• Never had an accident or missed work
• Stayed with your company forever
resulting in zero turnover.
• Always performed at 100%
[End Part 3]

25. Applicant Rights-Employer
Responsibilities
• The Hiring Process is regulated by:
– The Fair Credit Reporting Act (FCRA)
• Full disclosure prior to background check
• Records used must be “current”
• Notice of Adverse Action
• Does it affect you?
– EEOC
• Sets a very high standard for use “non-
conviction” records

26. Applicant Rights
• The right to know if a prospective
employers runs a background check
• The right to dispute information they
believe is incorrect.
• The right to work in an environment that
is safe and non-threatening

27. Employer Obligations
• Disclose to an applicant if they are
doing a background check
• Notify the applicant if the background
check contributes to a decision not to
hire
• Do what is “reasonable” to provide a
safe, non-threatening work environment

28. Summary
1. The best predictor of future behavior is
past behavior.
2. Verify basic applicant information
through a third party
3. Do what is “reasonable”
4. Add drug testing to your hiring process
5. Use a licensed, insured, provider

29. Remember…
• Time you spend hiring is time not spent
running your business
• Effective background checks will reduce
your turnover and decrease the time
(and money) you spend on hiring.

30. Thank You.
Free Download of
You and Your Data
How Your Personal Data Affects Your Job Search
www.youandyourdata.com
Enter: “GNAP” in the Promo Code Box

31. Don’t Hire Your Problems
A Simple, Cost Effective Approach to Pre-Employment Screening
John Pate – LS Screening
www.lsscreen.com
www.youandyourdata.com