Hiring a new employee is a big financial decision, and a successful hire can greatly contribute to the growth of your business. But if you bring on the wrong person, it can potentially cost you thousands, or even get you into legal hot water. Here are some steps you can take to reduce the chances of making a bad hire, minimizing your risk.

Have Applicants Sign a Consent Form

Many employers are reluctant to talk about the details of a former employee’s performance for fear of being sued. But when you’re considering bringing an employee into your business, you need to know more than just their start date, separation date and job title, which is all some companies will give you. One way to get companies to open up is to have applicants sign a reference check authorization form for their last few employers. In it, the applicant grants permission for you and applicants’ former employers to discuss the details of his employment, and releases both parties from any liability or harm that may come from those discussions.

Check with Former Employers

Once you have the consent form in hand, it’s time to call applicants’ former employees. To increase your odds of getting useful information, you should ask to speak to the person who managed each applicant. You’ll want to first verify the details that the applicant gave you, and then ask additional questions, such as:

  • How well did they get along with their boss? With co-workers?
  • How much supervision do they need?
  • Why did they leave your company? They will not be able to answer this question if the employee left for medical reasons.
  • What were their responsibilities?
  • Which of those responsibilities did they handle best? Worst?
  • What areas do you think they should work to improve?
  • How do they interact with customers?
  • Are they team players?
  • Is there anything else you would like to say about them?

In addition to asking about work experience, some states allow you ask about past disciplinary actions and performance reviews. To find out if your state allows this, check with the local state labor office in your area.

Verify Their Educational History

Several high-profile people have made the news by claiming to have a degree from LaSalle University, a notorious diploma mill that was shut down after an FBI investigation. Among those found falsifying their resumes were the Navy’s surgeon general, the president of a university, a police chief of a major city, and a state senator.

Do a Criminal Background Check

Criminal checks are important not only to ensure that you hire someone trustworthy to work in your business, but also because if you hire someone who has a criminal past and then goes on to commit a crime while in your employment, you can be held liable for their criminal conduct in a negligent hiring and retention case. For example, if you hire someone to work with the public who has been convicted of violent actions in the past, you could be held liable if that person harms someone while on in your employ.

To run a criminal background check on an applicant, you’ll first need to ask them to sign a consent form allowing you to do so. Then, contact Essential Screens to run a full check for you. States have differing laws that govern the extent to which employers can consider a criminal background in hiring decisions. You can contact your state labor office to learn more about your state’s rules.

Employees are a major investment for any business owner, and it makes financial sense to do everything you can to ensure that the people you bring on board are up for the job. By taking the steps listed above, you can help increase your chances of hiring the right employees for your business and reduce your own exposure to risk.

Source: Intuit QuickBooks Small Business Center