Doing your hiring homework

by 16 Oct 2007

A not inconsiderable number of employees either fabricate or massage the truth in their résumés. Human Resources speaks with some experts about the process of pre-employment screening, exposes some of the pitfalls and provides a few best practice tips for HR professionals

Not every candidate is out to dupe employers about their past employment history or to defraud them of millions of dollars. There have been some high profile cases over recent years, but most often, candidates are more prone to exaggerate on minor details when it comes to putting up their hand for a new position.

A recent KPMG study found that around 25 per cent of all résumés contain falsified information. In addition, 14 per cent of employees involved in fraudulent conduct had a history of dishonesty with previous employers, and background checks may have uncovered such tendencies. A PricewaterhouseCoopers report also found that up to 66 per cent of Australian companies have reported theft of product and/or cash, and 85 per cent of these occur in a person’s first year of employment.

Each year thousands of people are employed who have falsified their backgrounds, many of whom have emerged through reputable recruitment firms, according to Greg Newton, managing director of Verify CV. This supports the company’s own findings, with one in 10 being of such a serious nature that the client terminates the employment process.

Common issues

Conducting adequate checks into the background of potential candidates is becoming a more complex task for HR professionals, who are caught between the necessity to fill a position quickly, being diligent in ensuring that the person they are about to make a job offer to is who they say they are, and the increasing threat of litigation as a result of a poor recruitment decision, according to Newton.

“Simply, today’s applicants are using their résuméto market themselves in a competitive labour market,” he says. “As a result, their résumés are prone to have critical omissions, errors in fact, employment history gaps or false information designed to create an enhanced image and mislead the recruiter.”

In the US, a substantial number of organisations who are subject to the Sarbanes Oxley Act have made it absolute policy that the verification process must be separated from the talent sourcing process, Newtonadds. “This is simply HR due diligence, as we say. This has spilled across Europe and into Australia with numerous US and global multinationals now adopting this policy,” he says.

Costa Mina, managing director of Reality Check, says that although it is well-documented that business is experiencing skill shortages across a number of industries, HR professionals must not compromise the quality of the recruitment process or be tempted to abandon background checks as a means of filling a role.

“Employment screening is an effective means of ensuring organisations are not giving individuals with questionable backgrounds the opportunity to join their teams at the expense of genuine quality candidates, as a person’s history and the integrity of the information they provide can be a good indicator of their future behaviour,” he says.

“Recruiting the wrong person will create a negative influence on your company culture and reputation making it more difficult for you to attract and hire quality people in the future.”

Compounding the issue is the increasing trend for organisations to become more reliant on engaging candidates from abroad, Mina says. It is more likely and easier for a candidate to misrepresent personal and professional information because the perception, often matched by the reality, is that it is too difficult for their prospective employer to check their background.

Generational differences

Regardless of the skills shortages in various sectors, the competition for high-quality positions is intense. Many candidates embellish their résumés to distinguish themselves from their perceived competition, Mina says.

However, there are few generational differences that HR and recruitment professionals have to watch out for when it comes to screening and background checks. “In general, if someone is going to misrepresent or lie in their CV then they will regardless. Completing background checks on younger candidates is, however, harder, because there is less information and history to work with,” he says.

It is important to take a lateral approach to reference checking and be careful about which referees are spoken with, he adds. In the case of generation X or baby boomers, they may be more tempted to embellish their past and overemphasise their experience, achievements and qualifications because the perception is that it may be too difficult to verify.

“The point that must be made here however is that if there are discrepancies the issue becomes one of character as well as their ability to fulfil the requirements of the role. Sometimes completing the degree or having certain professional membership status won’t be the deal breaker in getting the job but lying about it will be,” Mina says.

Newton also says that résumé fraud is similar across the generations, however, there are a few standout differences. With younger applicants, for example, he says to look for ‘clearance to work’ and frequent undisclosed job change. “Delve into the real reason for leaving and the actual remuneration received through a line manager or payroll representative, as these can be embellished. This can also give you an insight into how they will fit into your culture,” he says.

“Older applicants sometimes try to hide short-term positions between longer assignments. Also look out for qualifications which are stated but were never completed and any history of workers compensation claims that may impact on their ability to do the job.”

Tips for HR

Companies are becoming more rigorous in applicant screening, requiring new in-depth background checks such as a ‘100-point identity check’, ‘terrorism association check’ and ‘drug and alcohol screening’ to meet their needs, Newton says.

In such a competitive labour market, it is also critical to move quickly once the decision to appoint to a position has been made. “Unfortunately, some checks can take time so forward planning is critical,” he says.

Employment screening is more than simply speaking to two referees nominated by the candidate the common process followed by the majority of recruiters, Mina says. “Wherever possible, seek permission from the candidate to speak to two or three of their previous managers to ensure the reference check is balanced and objective. The quality of the information obtained is governed by the quality of the source. Don’t be afraid to challenge the candidate if you feel the referees provided are not going to provide you with the information you need to make a well-informed employment decision,” he says.

Furthermore, the genuine quality candidate with nothing to hide will respect your right to carry out checks, while candidates with a questionable background will either withdraw from the process or place obstacles in your way to make the investigation more difficult. “Keep the candidate engaged throughout the screening and background checking process to ensure they understand and respect your decision to undertake verification,” he says.

Mina also recommends that questions asked during the reference checks be customised for the position the candidate is being considered for, rather than just asking questions taken from a standardised reference check template. “Questions should be asked of the referees that address the key responsibilities of the role that the candidate is being considered for. By addressing the key competencies and responsibilities of the role you will have more relevant information to make the right employment decision every time,” he says.

Top tips for HR professionals

There are six critical areas that HR professionals should watch out for when it comes to pre-employment screening and background checks:

1. An applicant's real identity - that is, is the person you are about to employ 'who they say they are'? It's not quite as simple as sighting a driver's licence as these can be stolen or falsified. It's a matter of in-depth cross referencing of multiple forms of identity including the electoral role.

2. Embellishment in an applicant's employment history which may involve hiding periods of unemployment or significant job change and/or falsifying job titles. An in-depth employment history trail check through previous employers is critical.

3. Qualifications that are stated but were never completed. This is quite common and just sighting an 'original' is not the answer. One needs to go to the issuing body to be sure.

4. The inability to legally work in Australia. Look out for an applicant's Australian passport or working visa - make sure it is real and current. With the thousands of overseas students in our higher education system this is potentially increasingly prevalent. You don't want staff to be publicly removed from your workplace.

5. Licences that have been withdrawn. A recent example was a sales representative for an alcohol company who had lost his drivers licence as a result of drink driving. Many disqualified drivers still have their licence in their wallet and you would be none the wiser unless you undertake a check through the relevant state issuing authority.

6. Criminal records which may impact on a person's suitability for a particular role. We recently record-checked a prospective store person for a pharmaceutical company who ended up having an eight-and-a-half page criminal record.

Source: Verify CV