Employee screening: the importance of screening candidates
Section one of the Personnel Today Management Resources one stop guide on employee screening, covering: the importance of employee screening in today's increasingly security-conscious world. Other sections.
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How to use this guide This guide aims to act as a practical one-stop source of information and advice. It will help you comply with the law and develop best practice in screening employees. Each section is prefaced with a list of ways in which it might be of use. Our objective is to allow you to get to key information and guidance easily and quickly. Where it may be necessary to find additional information, we have provided a thorough list of printed and online sources. |
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What this guide covers The term screening employees is used in this guide to refer to any vetting procedure or practice relating to candidate selection, including drawing up job descriptions and application forms, checking references and candidates' backgrounds for discrepancies, interviewing, and verifying candidates' details. The areas for HR covered in this guide will be:
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Recent newspaper headlines have turned the spotlight on the issue of checking employees' pasts, including revelations about child murderer Ian Huntley getting a job as a school caretaker despite police knowledge of previous criminal charges, and Daily Mirror reporter Ryan Perry bluffing his way into Buckingham Palace as a footman.
These events, along with the events of September 11, corporate scandals such as those of Enron and Tyco, and increasing concerns about illegal working, are putting employers under increasing pressure to check whether applicants are really who they say they are.
In a world that is increasingly security-conscious and aware of the importance of corporate reputations, businesses are turning to HR to help shield them against damage from staff misconduct.
Mounting concern about unwittingly employing people such as fraudsters, terrorists, racists or paedophiles is prompting increasing numbers of employers to tighten up their recruitment procedures, taking more time to carry out background checks and to take up and check references.
Heightened concern about security has had an impact on the recruitment process for nearly three in five UK companies, according to research.1 Some 40 per cent of employers said security concerns have increased the length of the hiring process, and another 12.7 per cent have increased the length of detail of background checks on prospective employees.
More than half of employers surveyed in a separate study at the end of 2002 were scrutinising prospective employees more thoroughly than the previous year.2
Among the drivers that are forcing employers to examine their policies and practices on employee screening are legislation (in particular, the Data Protection Act 1988), the increasing requirement for criminal record checks, growing awareness of the extent of dishonesty in job applications, the risks involved in employing immigrant workers and heightened security concerns around terrorism.
Legislation
A raft of new legislation affecting recruitment and selection has been introduced in recent years, including the Data Protection Act 1998 (DPA), which has strict protection and privacy rules limiting the information employers can collect and hold on former, prospective and existing employees.
The Information Commissioner recently pointed the finger at employers for using the DPA as a 'smokescreen' for poor practice. But there is much confusion among employers about issues such as handling and storing personal data, and how to go about vetting staff. In this guide, we address some of the key areas in terms of best practice and compliance.
A code of practice, the Employment Practices Data Protection (DP) Code, was recently published with supplementary guidance to help employers interpret the Act, but because employers are still finding it confusing, the Information Commissioner plans to bring out more practical and user-friendly guidance later this year.
Criminal records
Since enhanced access to criminal records became possible with the establishment of the Criminal Records Bureau (CRB) under the Police Act 1997, the issue of employing people with a criminal record has been thrust to the forefront of HR professionals' minds.
An estimated one-fifth of the working population has a criminal record. Failure to get paid employment is a major reason for people to re-offend, and getting a job is an essential part of successful rehabilitation. The Rehabilitation of Offenders Act 1974 (ROA) is being reformed, and employers need to be clear about best practice in this area to make sure they do not break the law and exclude valuable candidates.
Although the establishment of the CRB has encouraged employers to gain access to criminal record checks, there is still confusion as to which sectors and posts require checks.
The Care Standards Act 2000, for example, requires extensive checking of candidates for some posts in the care sector. And the Financial Services Market Act 2000 requires individuals in controlled categories to be checked for honesty and competence with the Financial Services Authority.
Trying to keep on the right side of the law and juggling the interests of the company, existing and potential employees, as well as the general public, can feel rather like walking a tightrope at times. The sections on recruitment and selection policy and practice and the law will help you with compliance.
Screening for substance misuse, ill health and genetics
One area that the DP code will now be focusing on is testing for medical information, including screening for drugs and alcohol. The fourth part of the code on medical information (occupational health, medical testing, drug and genetic screening) is due to be published in autumn 2004.
Testing for misuse of drugs and alcohol is a highly controversial area and one many organisations shy away from, unless they are in sectors where safety is of paramount importance, such as transport. Others have gone down the route of widespread testing. But the fourth part of the code will make it clear that employers cannot test candidates routinely for drugs and alcohol, or run genetic tests on them unless there is a very good health and safety reason, such as fitness to do the job, or to prevent bias against the disabled.
Employers need to get their houses in order, make sure they are using testing appropriately, examining their policies on health screening, making sure they are appropriate and do not discriminate, and that the tests are appropriate.
The new Employment Equality Regulations 2003, which came into force in December 2003, aim to prevent discrimination against gay men because of actual or perceived HIV status, so employers need to be mindful of these.
In terms of genetic screening, it appears still to be early days for employers. The fourth part of the code will be addressing this issue.
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Vetting staff: Examples of sectors most affected |
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Area of concern |
Affected employers |
Screening options |
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Illegal immigrants, those without legal right to work in the UK |
Hospitality, cleaning services, catering staff |
Checking ID documents and work permits |
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Protecting children and vulnerable adults |
Education authorities, care homes, nurseries |
Criminal Records Bureau (CRB), police records |
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Security |
Aviation industry |
ID, CRB |
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Fraud |
Financial sector, employers of accountants |
Credit reference, checks, CRB |
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Customer facing roles |
City firms, firms with field staff |
Reference check |
Lies, lies and more lies
One in seven applicants lies, conceals, or omits significant information in their CVs, according to a survey by employee screening firm Zephon, a subsidiary of The Risk Advisory Group (TRAG).3 More than half of CVs submitted by applicants in 2002 contained lies or inaccuracies, ranging from gaps in employment history to fraud committed against previous employers, or falsified qualifications.
Lying by candidates appears to be on the increase, with a growing tendency for people to feel they can cheat their way into a job, according to TRAG. The proportion of job applicants with discrepancies rose by 15 per cent year-on-year from 54 per cent in the last quarter of 2001 to 62 per cent in the last quarter of 2002. In 2002, IT contractors were the worst offenders, with discrepancies in 70 per cent of applications. Women in their late 20s and men in their late 30s were also more likely to provide misleading or deceitful CVs, with two-thirds in each group likely to have inaccuracies.
The landmark case of Dubai Aluminium v Salaam and others in 2002, has also fuelled concerns over employing dishonest employees. The case concerned an elaborate $50m fraud perpetrated against Dubai Aluminium through a series of bogus consultancy agreements. Judges in the past have taken the view that employers are only liable for employees' acts within the ordinary scope of their employment. But the House of Lords ruled in this case that an innocent employer can be vicariously liable to third parties for the dishonest acts of its employees, as long as those acts are carried out in the ordinary course of business.
Even HR professionals lie on their CVs. Nine per cent admit to lying on their CV when applying for a job, according to a survey by Reed Business Information.4 Nine per cent of departmental heads, 9 per cent of managers and 8 per cent of staff admitted to deceit. The figure was 10 per cent in the banking sector and 11 per cent in IT. Of those admitting to lying, 32 per cent said they had lied about experience, 30 per cent about salary and 16 per cent about academic qualifications.
The difficulty seems to come in part from candidates being confused about what is acceptable self-presentation and deliberate distortion. TRAG believes the tough economic climate is also playing a part, making candidates more desperate to secure new jobs. Others blame changes in social culture, with 'spin' having become the zeitgeist.
Putting in place well thought-out employee screening policies and practices will help employers spot discrepancies and reduce the risk of employing a true fraudster. About two-thirds of people who have perpetrated fraud against their company have so-called 'red flags' in their career history, which could have been exposed by screening, according to TRAG.
Typical embellishments that investigations unearth include inflating a job title, pretending to have been a global rather than regional director, or claiming to have earned an MBA from a school the person actually only attended. It is also common to find gaps in employment history, which people have attempted to cover by falsifying employment dates.
Forging academic qualifications has become much easier with the advent of sophisticated desktop computer equipment, allowing applicants to create entire education histories, including detailed records of graduate or postgraduate studies at leading universities. Phoney diplomas and university degrees can be readily bought via the internet from 'degree mills' operating in the US.
Illegal workers
The issue of illegal working is the subject of much media attention and is one employers need to urgently address. Any organisation employing someone illegally faces a fine of £5,000 per worker under the Asylum and Immigration Act 1996.
Organisations employing large numbers of temporary and casual workers, such as those in the hospitality and retail sectors, are finding themselves particularly swamped with applications from asylum seekers and are finding it hard to identify which documents are valid.
The Government recently announced an amnesty for those illegal workers from eastern European EU accession states if they join its employment register, coming into force on 1 May 2004.
Forgeries of identity documents, such as passports, are increasingly convincing, even to the police or hard-pushed immigration officers, let alone an unsuspecting employer.
For as little as £600 on the black market, terrorists or illegal immigrants can obtain convincing forged passports, complete with watermarks, visa stamps and safeguards, using ultraviolet ink typically considered to be very hard to obtain.
Nearly 10,000 forged passports and other identity documents were detected at British ports in 2002, representing an increase of 46 per cent on 2001. But this is thought to be just the tip of the iceberg. The Home Office estimates that only one in 10 forged documents used to gain illegal entry into the UK is ever discovered. And it only takes a forged passport and forged letter from an employer for someone to obtain a National Insurance number to present to a bona fide employer.
But if employers need to be on the look out for unwittingly employing someone who has no right to work in the UK or, worse, has criminal intent, they also need to avoid turning their backs on asylum seekers with a legal right to work in the UK and much to offer an organisation, including skills which may be hard to come by.
Although all employers need to examine their recruitment and selection practices, some employment sectors are particularly affected by the issue of vetting candidates. These include sectors that employ large numbers of overseas workers, such as the hospitality and catering sector, the aviation industry and all public sector employers responsible for children or vulnerable adults. The latter two are legally bound to check that candidates have not lied about their past. Different sectors have different concerns and different checking procedures to consider.
It is important to strike a balance. Extensive screening of potential and existing employees brings risks of falling foul of the law, of failing to respect individuals' rights and to treat people in a non-discriminatory manner. And it means organisations could easily miss out on people who could be a highly valuable asset. After all, the current UK director of public prosecutions has a conviction for cannabis possession.
References
1Study by search and recruitment group MRI Worldwide in 2003.
2Survey by IT recruitment consultancy Elan in 2002.
3Survey of 877 CVs by the Risk Advisory Group during the final quarter of 2001.
4Survey of 2,874 HR professionals in 2004 by Reed Business
Information.
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One stop guide on employee screening: other sections Section one: The importance of screening candidates Section two: Policy and process Section three: Methods of employee screening Section four: Recruitment and selection Section nine: Model documents (this section contains a job description for a senior manager, application forms for manual posts and non-manual posts, a reference request form and reference clause in an offer letter, all of which can be found in the recruitment section of XpertHR's policies and documents service)
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