Puzzle it out

Painting an accurate picture of prospective employees is becoming increasingly critical for organisations, but how does HR go about doing it?

The first day of a new job can be a nerve racking experience - for the employer as well as the recruit. Hiring is a risky business - and we're talking about more than a depleted stationery cupboard, the odd personality clash or a lapse in productivity. How do you know this friendly newcomer won't defraud your company of millions, leak embarrassing stories about you to the tabloids or, even worse, plant a bomb in your basement?

Buckingham Palace must have rued the day they gave Daily Mirror reporter Ryan Perry a job based on a casual phone reference from a regular at his old pub and a fax from a manager of a non-existent paint firm. As a result of these sloppy recruitment practices, the erstwhile footman regaled the nation last November with insights into the Queen's breakfast rituals, including her predilection for Tupperware and feeding toast to the corgis.

Thorough pre-employment screening is a repetitive, time-consuming process, so it's no surprise that some employers give it a miss. But some don't have a choice. The aviation industry, for instance, must vet staff who are to work 'airside' (ie, beyond the departure gate) in airports; while City firms must perform regulatory checks on candidates for approved positions, such as customer-facing roles; and schools and social services have a duty to keep paedophiles away from children.

Recruiters have to predict a candidate's future actions based on past performance, and the aim of screening is to check they are qualified to do the job, have not lied on their CV, are healthy and don't have a previous conviction that would preclude them from fulfilling the role.

The basic starting point is verifying the candidate's identity in the first place. This might sound obvious, but a simple passport check could prevent a hefty fine for hiring someone who doesn't have a right to work here.

"The whole process falls apart if you don't know if they are the person they say they are," says Karen Edwards, head of business development at screening firm Kroll Personnel Risk Management. "Screening is like a jigsaw: the pieces fit together to build up a picture of the person."

The next stage is a series of checks, which includes checking the candidate's qualifications and professional memberships and taking references from previous employers. The screener may quickly verify over the phone the exact dates of employment, the position the candidate held, salary and details of parental leave taken. Or a more detailed written reference may be sought, outlining the candidate's duties, a judgement of their honesty and ability to carry out their role, whether they left of their own accord and whether the employer would, given the right circumstances, hire that individual again.

Such a typical screening assignment can cost under £100 per candidate.

If the role involves cash handling or working in the accounts department, a credit reference check might be done as well. And some employers may want electoral roll checks done to verify a candidate's previous address - a missing address may relate to a job the candidate would rather forget, a county court judgment or some other lie on the CV.

But the Data Protection Act stipulates that checking should be proportionate to the role. Running credit checks on a receptionist might be deemed over-heavy under the Act, and might put the candidate off the job. This has to be balanced against the desire to protect the employer's security.

Senior management roles may in addition warrant a full investigation of the candidate's career history and business acumen, going back 10 to 15 years. This might include media searches for press articles on the individual and, for senior financial roles, checking they are not listed on a database of money laundering suspects.

Screeners may seek detailed telephone interviews with previous line managers - typically lasting up to 30 minutes - to verify the candidate's competency and achievements. The responses are then examined to see how they compare with what was said at interview or on a CV.

So how often do employers withdraw job offers as a result of background checks? Screening firm Control Risks Group says that in one month alone a single client withdrew 20 job offers after screening highlighted discrepancies. More than half of all CVs submitted to The Risk Advisory Group's employee-screening unit, Zephon, contained lies or inaccuracies, ranging from gaps in work to falsified qualifications and fraud.

Screening can be expensive, especially for senior positions. Bob Dulieu, operations director of screening firm Capcon says a basic screen costs between £250 and £500, rising to about £10,000 for a comprehensive investigation of an international finance director or chief executive for a multinational. He estimates that between 5 and 10 per cent of applications contain "substantive" issues - amounting to "premeditated differences in reality".

"Recruitment is very, very expensive so it's all relative," he says. "If you outsource your recruitment it costs you about 10 per cent of the first year's salary, but good screening would probably be 5 per cent of that."

Despite the expense, investment bank ING is a keen advocate of pre-employment screening. As a City firm, it must satisfy its regulator, the Financial Services Authority, that a candidate is 'fit and proper' to fulfil certain 'approved person' roles - generally senior, customer-facing roles. This involves checking with the Criminal Records Bureau for spent convictions, and extensive employment references to rule out past financial irregularities.

"Screening always works in organisations that do it," HR director Mark Staniforth told Personnel Today. "It is absolutely necessary. If you're going to put someone in a role of responsibility you need to be diligent."

ING contracts an outside firm to do robust background screening of previous employment and qualifications, but refutes the idea that HR sees screening as a 'dirty job'.

"Whether the position is in an approved person category or not, we don't differentiate as far as the level of enquiry is concerned. We don't differentiate between role and seniority," says Staniforth.

The Zephon screening unit checks court records to see if a candidate has been sued in the High Court or has taken action themselves - perhaps against a former employer.

"Our approach is really not to be judgemental but to point out to the employer something that's an anomaly or a discrepancy," says Alan Beazley, Zephon's business advancement director. "When you get undisclosed gaps between jobs or a university degree that was supposed to be a 2.1 but was really a 2.2, that tends to ring alarm bells.

And for HR departments that are hoping to outsource their data protection headaches along with their pre-employment screening, financial HR network City Personnel Group has a few words of warning.

"Make sure you've got a properly documented agreement with your supplier," says chairman Stephen Sidebottom.

"Make sure you know what they're asking and are not thinking that you can outsource responsibility for screening. We're asked to get details of spent convictions. If you're going to do that you need to have policies in place about how you handle them."

Tips for screening candidates

• Always check the identity of the applicant
• Don't rely on the phone number supplied by the candidate to contact the previous employer - look it up independently
• Always check the identity of the referee - call the company back and verify this independently if you're not sure
• Listen to your gut instincts - if something doesn't feel quite right, investigate it further
• Make sure you know exactly what data your outsourced company is collecting - you're responsible for it

Case study: BAA

BAA - the world's largest airport operator - has hired several extra HR staff to handle the volume of pre-employment checks the company has instigated since the attacks on the World Trade Center in New York on 11 September 2001.

An extra two-and-a-half staff have been hired to handle the upsurge in security recruitment and to perform continuous five-year reference checks on all would-be recruits, regardless of where they will work in the company.

This goes over and above BAA's legal requirement since July 2002 to do such reference checks for staff working 'airside' - in the departure lounge, on the runways or on the plane itself.

"Some employers would pick up on a couple of references," explains London Heathrow's HR director Gordon Rae. "Because we take security and safety very seriously, if there are any gaps in the candidate's CV, we require a personal referee to verify what the candidate was doing during that period."

Checking references and completing the necessary documentation does cause delays, Rae concedes, especially if a candidate has worked overseas in the past five years.

"It can take two or three weeks until the references come back and individuals will hold off handing in their notice until then," says Rae. "There are always minor frustrations around delays, but we take the outcomes very seriously so we have got to live with some of that."

Legally, BAA security also has to ensure all its staff and contractors working in the restricted airside zone - from baggage handlers and air crew to shop workers and cleaners - have a clean criminal record before they can get an  airside pass.

Since July 2003, all new recruits must obtain a basic disclosure of their unspent convictions from government agency Disclosure Scotland - currently the only agency processing checks for airside passes. These must then be shown to BAA security. By July this year, all existing staff must have done the same. Candidates are barred from getting an airside pass if they have previous unspent convictions for a whole host of crimes in the categories of violence, dishonesty or abuse of trust.

Until 9/11, staff working in such restricted zones only had to provide two character references, one of them from a past employer.

Security staff form the bulk of BAA's recruitment. Security staff, who form one-third of the company's 4,000-strong workforce, have a turnover of less than 4 per cent. They mainly screen passengers and hand baggage once they've checked in. During 2003, the company hired an extra 600 security guards to comply with stricter post-9/11 requirements.  

In addition to the five-year continuous reference checks and criminal records checks, potential new security recruits must also get counter-terrorism clearance. Applicants for security jobs who might fail any of these checks probably de-select themselves at the beginning of the recruitment cycle, says Rae, when they are warned about all the checks.