Under the Microscope
Excerpts from Hindustan Times - September 7, 2004.

It can take just one forgotten background check to financially cripple an organization. So watch out! Next time you apply for a job, your life could be under the microscope.

For corporations, particularly those dealing in proprietary products and technologies, the consequences of not running a background check on prospective employees can be severe, often resulting in heavy revenue or reputation losses. It is, therefore, not surprising that offshore clients insist on a mandatory screening of all staff at the vendor end to eliminate any potential source of risk.

Screening potential employees is not a new phenomenon. Corporates have been doing it for over 20 years, although it is only in the last few years that more small and medium businesses are beginning to use sophisticated pre-employment screening strategies to protect themselves, their employees and their intellectual property. In the 1980s, businesses conducted background checks because they didn't want to be victims of theft. Today companies do it because they don't want people with a history of drugs, violence and sexual assault or suffer because their trade secrets have been leaked.

Underqualified and non-motivated workers require closer supervision and direction. They may also give customers inaccurate information to competitors, while high employee turnover can cause a heavy financial drain on the company through separation costs (administrative costs, unused vacation time, temporary employment and other expenses), replacement costs (incurred on recruitment and selection), training costs and lower productivity while still training on the job.

The screening market in India is estimated to grow to a whopping Rs 900 crore by 2008 with the growth in offshoring. Random employee audits keeps the surveillance process on and the employees on their toes.

However, one common problem associated with background checks is that ex-employers can refuse to divulge information fearing legal action if they give a negative reference. So they may confirm only some innocuous details, such as the dates of employment, job title and salary, but not sensitive issues related to job content and performance, where employees fib the most.

These problems can, however, be overcome in the following manner

• Having departing employees sign an agreement in which they consent to the disclosure of relevant information concerning their work history
• When a reference query comes in, the HR Manager speaks honestly
• If the questioner seeks medical information related to the employee's physical or mental health, the HR manager should decline to disclose it
• Prospective employers who are adding staff should have the employee sign a release authorizing former employers to provide relevant information about his or her previous work history
• Check with multiple sources to arrive at the complete picture and be extremely attentive to what the references don't say. If they avoid some topics, that may be a red signal

And, finally issue disclaimer with your report. Even if you have checked a wide range of sources, you cannot be 100 per cent sure that you are right track.

Honesty and applications
According to a Reference check Survey conducted by US-based Society of Human Resource Management in 1998, only 50 per cent of the candidates are absolutely honest in their resume disclosures. The most common lies relate to the length of stay with a former organization, salary and former job titles. These false claims are usually discovered during reference checks. The survey found that the background information that candidates usually lie about relates to

Criminal records : 45%
Former job title : 44%
Former employers : 35%
Driving records : 33%
Degrees : 30%
Credit : 24%
School attended : 22%

What companies reveal
Date of employment : 98%
Eligibility for re-hire : 42%
Salary history : 41%
Reasons for heaving : 19%
Job qualification : 18%
Employability : 16%
Work habits : 13%
People skills : 11%
Violent/bizarre behaviour : 8%
Personality traits : 7%