The concept is basic; employers are liable for the actions of their employees. It becomes dicey when those actions result in damages, loses or injury to another party. It becomes expensive when it can be shown that the employer chose not to access readily available information that could have influenced the decision to hire that individual and prevent the subsequent damages. The average settlement is $600,000 with multi-million dollar awards not uncommon.

What to Check

"References don't tell me anything" is a common complaint Performance predicting information is rarely obtained from previous employers. But it's critically important that a bona fide background investigation starts with those sources but goes further.

The areas commonly researched include: Social Security Verification, Driving Record, Educational Credentials, Professional Licenses, Criminal History, Credit Report and in a few states, Workers Comp History. Individually, or in combination, may reveal gaps, falsified work history, fictitious name, misrepresentation or exaggeration of other job criteria and a history of undesirable or even dangerous behavior. The breadth of the research ought to relate to the requirements of the position. A Social Security number and Criminal History check may suffice for a position on the shop floor or a service position providing access to property. If the position required operating a forklift or driving company vehicles, a driver's history should be included. If the position were a production engineer, verify the applicant's engineering degree.

While a great deal of information can be verified with a credit report, the Fair Credit Reporting Act established additional requirements for employers in obtaining permission and disclosing the results. For those reasons, Credit Reports are usually limited to those positions with clear fiscal responsibility or access to significant corporate funds.

Getting information

Start with a completed employment application signed by the applicant; not a resume attached to a blank form. This is an employer's primary legal document. The signature section should contain an affirmation that the information is accurate, that the penalty for falsification is immediate termination and obtains permission to conduct a thorough background investigation. Ask for dates, pay, title, supervisor, address and telephone numbers. Don't ever accept incomplete applications.

Then plan for professional help. Look for firms that specialize in this kind of investigation. They should be able to access most of the information within 48-72. Fees range between $25-50. depending on the breath of the research. Though most of the information may be unremarkable, don't be surprised if you find serious inconsistencies or high risk factors with a "star" applicant.

The Low Unemployment Trap

With labor tight and "Now Hiring" signs on every street corner, why should an employer take additional steps to reject candidates? Odds. For many positions, the available labor pool can be statistically more heavily populated with less desirable individuals. These steps are one of the objective ways to be sure that what you hope you saw in the interview is what you find in the workplace.