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Introduction to International Screening

by Lester S. Rosen

Employers have long recognized that conducting due diligence on new hires is a mission critical task. Firms cannot afford to be sidetracked by employee problems such as workplace violence, theft, false resumes, embezzlement, harassment or trumped-up injury claims. Employers can be the subject of lawsuits for negligent hiring if they hire someone that they should have known, through the exercise of due diligence, was dangerous, unfit or unqualified.

However, with the mobility of workers across international borders it is no longer adequate to conduct these checks just in the United States. A 2000 government study shows that 11.5% of the population consists of immigrants. In addition, an increasing number of workers have spent part of their professional career abroad. The number of countries from which employers seek additional information about applicants is expansive, and includes India, China, Philippines, France, Germany, Russia, Brazil, Mexico, Australia, Japan, Canada, among others.

International Background Screening Perceived As Difficult
Because of the perceived difficulty in performing international employment screening, some employers have not attempted to verify international credentials or to perform foreign criminal checks. However, the mere fact that information may be more difficult to obtain from outside of the U.S. does not relieve an employer from their due diligence obligation.

Nor can employers simply assume that the U.S. government has conducted background checks if the worker was issued a visa. After the events of 9/11, the U.S. has increased checks on foreign visitors and on workers on government "watch lists." However, the government checks are generally not aimed at verifying a credential or checking for criminal records for employment purposes.

To exercise due diligence in hiring, employers should consider screening internationally for criminal records, employment, education, and publicly available terrorist lists.

Criminal Records
When it comes to criminal records, each and every country is completely different. The availability of public records that is taken for granted here in the United States is often times not available abroad. In some countries, records are available at the courthouse, similar to how criminal records are obtained in the US. In other countries, records can be obtained from a police agency. In some countries, the best course is to have the applicant obtain their own certificate of good conduct from their local police station.

For criminal records searches, it is important to know exactly where the person has lived to ensure you are searching the appropriate court. Keep in mind also that that turnaround time for international criminal searches takes longer than domestic searches. Different countries also have different rules on the level of searches, but in most countries it is possible to obtain information of offenses that are at the felony level.

Another concern is name variations. Many countries have naming convention that is different then the US, such as the use of the mother's name. Complications can also arise for applicants whose name is based on a non-English alphabet, such as Chinese, Arabic or Japanese. There are numerous ways that such names can be translated into English.

Privacy and data protection is another crucial issue. For example, the European Union has passed strong privacy rules affecting how personal data can be obtained and utilized. U.S. background firms that do international searches should be a member of the U.S. Department of Commerce Safe Harbor program, which demonstrates a commitment to the E.U. privacy and data protection rules.

Education
Verification of an educational degree earned abroad is critical to verify credentials and to avoid fraud. An employer needs to determine if an applicant in fact attended the school claimed and received the degree claimed. Statistics show that education fraud can run as high as 20%. The employer also needs to determine if the school is accredited and authentic. The world is awash with phony schools and worthless diplomas. If the employer is not familiar with a school, they should conduct their own research. A legitimate school will often have an e-mail address or phone number so that they can be contacted to verify a degree.

Employment
Foreign employment can also be verified by contacting the employer even though they are in a foreign country. Often such calls will be made in the middle of the night due to time differences. The critical step is to obtain as much information about the past employer as possible from the applicant. If the employer does not speak English, an interpreter may be needed.

Terrorist Lists
Other due diligence tools are the various terrorist databases available to the public, such as the Office of Foreign Assets Control ("OFAC") list maintained by the U.S. Department of the Treasury. Such lists are readily available but there are limitations as well, such as working with name matches only when no additional details are available. To locate a list of web sites containing publicly available lists, and for more information on international background checks, go to: www.esrcheck.com/international.php.

Lester S. Rosen is an attorney at law and President of Employment Screening Resources (www.ESRcheck.com), a national background screening company headquartered in Novato, California. He is the author of, The Safe Hiring Manual--Complete Guide to Keeping Criminals, Imposters and Terrorists Out of Your Workplace (512 pages-Facts on Demand Press), the first comprehensive book on employment screening. He is a frequent speaker nationwide on pre-employment screening and safe hiring issues. He was the first co-chairman of the National Association of Professional Background Screeners (NAPBS), the organization for the background screening industry.

Background Screening and Safe Hiring: An Introduction

Reprinted from the April, 2002 edition of Occupational Health and Safety Magazine (www.ohsonline.com )

Given the enormous cost of a bad hiring decision, it is no surprise employers want to boost the effectiveness of their hiring process.

by Lester S. Rosen

It is the ultimate nightmare for every human resources, security, or risk-management professional: Your phone rings late Friday afternoon as you wind up loose ends from yet another challenging week and are looking forward to a quiet weekend. A panic-stricken voice informs you that Pat in accounting has assaulted another co-worker and threatened to harm a supervisor. It turns out Pat was not only stealing money, but did not really have the experience claimed.

As the mess is being sorted out, everyone will be asking you the same question over and over. From the company CEO, CFO, and corporate attorney to managers, supervisors, and co-workers, there is one thing everyone wants to know: How did that person get hired in the first place?

If the matter turns into litigation, the legal fees for just one incident of workplace misconduct can easily soar into the six figures, and jury awards can be astounding. Your firm can be sued by injured co-workers, members of the public who were damaged, or even the bad employee who may claim wrongful termination. Once litigation starts, you will also find that in addition to your normal duties you now have a second and nearly full-time job--dealing with the discovery process in litigation and the organizational fallout.

Contrary to popular perception, there is no national database of criminal records that is available to private employers.

The statistics on the consequences of even one bad hire are chilling. The financial cost to businesses from theft, violence, and false credentials can be enormous. There are other costs that are hard to measure, such as the harm to employee morale or the firm's reputation. Industry statistics suggest the cost of even one bad hiring decision can exceed $100,000, taking into account the time spent recruiting, hiring, and training and the amount of time the job is left undone or done badly by an unqualified applicant.

Given the enormous price tag of a bad hiring decision, it is no surprise that employers of all sizes are turning to various tools to boost the effectiveness of their hiring process. The tools run from honesty and skills testing to behavior-based and group interview techniques.

Ultimately, none of these tools has proved effective in weeding out bad candidates, unless used in conjunction with a program of pre-employment background screening to obtain hard facts about a candidate.

Pre-employment background screening works in four critical ways:

Just having background screening can discourage applicants with something to hide. A person with a criminal record or false resume will simply apply to a company that does not pre-screen.
It limits uncertainty in the hiring process. Although using instinct in the hiring process can be important, basing a decision on hard information is even better.
A screening program demonstrates that an employer has exercised due diligence, providing a great deal of legal protection in the event of a lawsuit.
Having a screening program encourages applicants to be especially forthcoming in their interviews.

Pre-Screening Tools
Checking criminal records is a good example of a pre-screening process that helps promote safe hiring. It is estimated that 10 percent of job applicants have criminal conviction records relevant to the hiring process; without a screening program, it is a near-statistical certainty that a company is going to hire someone with a criminal record. Contrary to popular perception, there is no national database available to private employers. Criminal records are normally checked by having qualified researchers visit courthouses in counties where an applicant has lived or worked. Because there are more than 10,000 courthouses in America where records are kept, most employers outsource this task to qualified firms that specialize in pre-employment screening.

Another important tool is resume verification. Job applicants often use their resumes as a marketing tool, but the hiring company can find itself in trouble when resumes exceed the bounds of honesty. It is estimated that up to 30 percent of resumes contain material falsehoods that pertain to previous employment, education, and professional licenses. A professional screening firm can verify whether an applicant has the degrees or licenses claimed. Even if a past employer will not give details about job performance, just verifying the job dates and job title is crucially important. One of the most critical parts of the hiring process is to look for unexplained gaps in employment. That is important in order to help a screening firm check the appropriate courthouses while searching criminal records.

One of the most critical parts of the hiring process is to look for unexplained gaps in employment. These help a screening firm check the appropriate courthouses while searching criminal records.

Other tools can include credit reports (when relevant to the job), Social Security number traces, driving records, national wants and warrants, as well as civil and federal court records.

Common Employer Concerns
Even with all of the advantages of a screening program, many employers still have questions and concerns about implementing background checks. These are the seven most commons concerns that employers express:

Is it legal?
Employers have an absolute right to conduct lawful pre-employment screening in order to hire the best-qualified candidates. A federal law called the Fair Credit Reporting Act (FCRA) balances the right of employers to know whom they hire with an applicant's right of disclosure and privacy. Under that law, the employer first obtains the applicant's written consent to be screened. In the event negative information is found, the applicant must be given the opportunity to correct the record. Employers should set up a consistent policy so similarly situated applicants are treated the same. A qualified screening company will assist an employer with legal compliance issues.

Does it invade privacy?
No. Employers can find out about only those things that an applicant has done in his "public" life. For example, checking court records for criminal convictions or calling past employers or schools does not invade a zone of personal privacy. Employers are looking only at information that is a valid and non-discriminatory predictor of future job performance. To maintain privacy, most background firms have Internet systems with secured Web sites. Employers should also take steps to maintain confidentially within their organization, such has keeping reports in a separate file from the personnel files.

Is it cost-effective?
A pre-employment screening will typically cost less than the cost of a new employee on his or her first day on the job. That's pocket change compared to the damage one bad hire can cause. In addition, employers typically only screen an applicant if a decision has been made to extend an offer, and not all applicants. It is ironic that some firms will spend hours shopping for a computer bargain and at the same time try to save money by not adequately checking out a job applicant, which represents an enormous investment. The bottom line is that problem employees usually cause employee problems, and money is well spent to avoid problems in the first place.

Does it discourage good applicants?
Employers who engage in screening do not find that good applicants are deterred. Job applicants have a desire to work with qualified and safe co-workers in a profitable environment. A good candidate understands that background screening is a sound business practice that helps a firm's bottom line and is not an invasion of privacy or an intrusion.

Does it delay hiring?
No. Background screening is normally done in just 48 to 72 hours. Most of the information needed is not stored in databases but must be obtained by going to courthouses or calling up past employers or schools. Occasionally there can be delays that are out of anyone's control, such as previous employers who will not return calls, schools that are closed for vacation, or a court clerk who needs to retrieve a record from storage.

Furthermore, an organization that is careful in its hiring practices should find a lower rate of "hits" during background checks. There are a number of steps a firm should take to ensure safe hiring well before a name is submitted to a background company. These techniques include making it clear your firm does background checks in order to weed out bad applicants, knowing the "red flags" to look for in an application, and asking questions in interviews that will filter out problem candidates.

The bottom line is that problem employees usually cause employee problems, and money is well spent to avoid problems in the first place.

Is it difficult to implement?
For an overburdened HR, security, or risk-management department already handling numerous tasks, outsourcing background screening can be done very quickly and effectively. A qualified pre-employment screening firm can set up the entire program and provide all the necessary forms in a short period of time. Many firms have Internet-based systems that speed up the flow of information and allow an employer to track the progress of each applicant in real time.

How do we select a service provider?
An employer should look for a professional partner, not just an information vendor selling data at the lowest price. An employer should apply the same criteria that it would use in selecting any other provider of critical professional services. For example, if a employer were choosing a law firm for legal representation, it would not select the cheapest--it wold clearly want to know it is selecting a firm that is competent, experienced, and knowledgeable, as well as reputable and reasonably priced. The same criteria should also apply to critical HR services. A screening firm should have an understanding of the legal implications of background checks, particularly the federal Fair Credit Reporting Act.

Both employers and applicants have learned that pre-employment screening is an absolute necessity in today's business world. More importantly, they've learned due diligence in hiring is a way to keep firms safe and profitable in these difficult times.

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