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Ten Reason You Should Do Background Checks on Potential Employees

Written February 19, 2012


If you’ve been a subscriber to this newsletter for the past year and have read any of my articles, you already know why it is so important to have TOP Performers in every position of your company. It is the path to go from good to great and exactly how business grows and gets easier.

If you or your managers are forced to spend any of your time solving People Problems, you have hired the “wrong” people and will not reach your profit potential. Any time and energy spent solving work ethic, reliability, conflict, turnover or productivity issues takes you away from developing sales and growing your business.

In the long run, this will end up costing you your hard earned profits and more importantly, quite possibly the accomplishment of your professional and personal goals.

Along with using our market leading pre-employment and “Job Fit” assessments (which can improve your hiring success rate to over 75%), the most successful organizations perform background checks on every potential employee. They will help you solve many of the “people” related problems that managers spend most of their day solving. They also will help you greatly improve your odds of hiring a TOP Performer for every position.


Here are 10 reasons you should start doing background checks on every finalist.

The following are not provided to scare you or get you to do something you haven’t done before, they are just facts. By knowing them, you’ll do a much better job in successfully making your most important business decisions… your hiring decisions:

1. Falsified Information in Applications & on Resumes

  • 95% of college students admit they are willing to include false information on their resume to get a job

  • 53% of job applications contain false information (SHRM study)

  • The most common “exaggerations” are: Inflated titles & salaries, inaccurate dates, unfinished degrees and out-and-out lies in regards to specific roles & duties


2. You Don’t Want to Lose Your Business

  • 30% of business failures are due to poor hiring practices (Department of Commerce)

  • Negligent hiring complaints are on the rise (from other staff & customers)

  • Employers are being held liable for the misconduct of their employees (even if the action occurs outside your place of employment)


3. You Probably Won’t Win in Court

  • 33% of business have been (are being) sued on an employment issue

  • Fraudulent Worker’s Comp claims are costing American business more than $5 billion dollars annually

  • Employers lose 60% of all “negligent hiring/supervision jury trials.” The average settlement is $1.6 million dollars (and this is seven year old information, it’s much worse now)


4. Nobody Advertises Their Criminal Record

  • Have you ever seen a criminal record listed on a resume? It’s only the good stuff, right?

  • 2 of 10 applicants have criminal records

  • More than 1 million people are wanted for felony crimes in the U.S.


5. Theft

  • Employee fraud and theft cost you $9 per employee, per day. That’s over $2,000 per employee a year.

  • 30% of all business failures are due to employee theft.

  • 48% of theft of money and inventory comes from your employees; not your customers.


6. More Theft (Subtle but Very Costly Forms of Theft)

  • Theft doesn’t only include money and property…

  • Wasting time, unauthorized time off, Internet surfing…

  • & punching a time clock for another employee all cost you money


7. And Even More Theft (of Intellectual Property)

  • 69% of white-collar workers admit to stealing commercially sensitive material when they left a company…

  • Including: E-mail address books & customer databases…

  • & more importantly, your organization’s sales proposals & presentations


8. They are Cheap

  • Considering it cost over $12,000 to replace an entry level employee & up to 150-250% of an annual salary to replace a salesperson or manager…

  • Paying just $13 to do a statewide or national criminal database search, $12 to do an education or employment verification, and under $100 for a complete background check…

  • It makes a lot of sense, doesn’t it?


9. They are Easy to Perform

  • All you need is your candidate to sign a consent form following your interview

  • Then you just logon to your background checking website (which of course we provide at People Values), enter the candidate’s information, make your specific & customizable request, and within 1 to 48-hours your check will be available to review on-line.


10. 84% of New Hires “Disappoint” in the First Year

  • When you use just a resume, application & “luck” to make your hiring decisions, only 16% of new hires will be with you a year later, performing as expected.

  • You’ll double your chances of “Culture Fit” with background checks – 26% will be with you a year later, performing as expected.

  • However, if your goal is to reach the potential you know your business has…

How would you like to Discover a Proven Process GUARANTEED to help you solve the #1 issue in business today... hiring & developing a productive team?

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All you have to do is watch the FREE video to discover:

  • The 3 1/2 HR Best Practices of TOP Performing Small Businesses (that you’re probably not using)

  • Why most of the people you’ve hired in the past fail to produce to your expectations

  • How to have peace-of-mind that your business stays productive even when you’re not there

  • The main reason you spend the majority of your time micromanaging employees

  • How to Quadruple Your Odds of Hiring the Right People... The 1st time… to over 85%

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