PrincePerelson & Associates

Risks of Hiring Without Background Checks

Ideally, every candidate in the talent market would be an upstanding, skilled, and reputable individual. Unfortunately, any HR professional knows that this isn’t the case. While some of the candidates you connect with will be perfect for almost any role, others could risk destroying the employee ecosystem of the business they join.

Talent acquisition is a complex, time-consuming, yet crucial part of building a successful business. Doing your due diligence before you bring a new hire on board is the only way to protect yourself from a host of potential problems. After all, according to the U.S. Department of Labor, the average cost of a bad hire to your company is 30% of that individual’s expected annual earnings.

Though conducting a background check may make some business leaders feel uneasy, the reality is that these evaluations could highlight a range of red flags about a potential hire.

Here are the risks you expose yourself to when you fail to conduct a background check.

1. Accessing the Wrong Talent

Companies have specific requirements when searching for new employees to add to their team. Every staff member has a purpose, and their success will depend on their skills. Unfortunately, some candidates over-sell themselves on their resumes to improve their chances of being hired.

Failing to conduct a background check means you can’t be certain that the credentials your candidate claims are real. In certain industries, where specific certifications are required for a professional to do their job safely, hiring unqualified talent is extremely dangerous.

Hiring someone with less experience or knowledge than they claim to have could also harm the rest of your team, who may have to cover for the newcomer’s inadequacies.

2. Exposure to Criminal Activity

Failure to conduct a background check may also mean that you end up with someone with a criminal history on your team. Although there’s no guarantee a person with a criminal background will have malicious intent towards your business, there’s no doubt that it drives up your risks.

With many companies worried about things like stolen cash, fraud, and cybercrime, it’s particularly important to ensure that you’re not bringing an extra outside risk into your organization. Examining your candidate’s history will give you an insight into whether they’ve ever been accused of business-harming activities in the past.

Hiring a criminal also places your customers and employees at risk. If your new staff member has a violent criminal history, there’s a chance that they could lash out on the job. This places not just your team and consumers in harm’s way but means you could suffer legal repercussions, too.

3. Legal Issues

Business owners are responsible for their employees to a certain extent. If your company hires someone who injures an employee or customer due to their negligence (or malicious intent), you could be implicated in a personal injury lawsuit. There could be increased liability if the court finds out that your company failed to conduct the appropriate background checks before hiring.

Even if it is determined that you handled a negligent hiring accusation correctly, the impact on your company’s reputation could be significant, which leads to our next point.

4. Reputation Problems

The people you hire reflect your business. Your employees are essentially the faces of your company, showing customers, partners, and clients what you stand for. If it comes to light that one of your team members has a negative history, this can significantly influence your brand image.

Most people will judge companies not just by their actions and the products they sell, but by the way that team members conduct themselves in everyday environments. Doing a background check helps ensure that you are hiring people that uphold your values and expectations.

Alternatively, if you hire the wrong person, you could end up scaring away customers, investors, and partners who get the wrong impression about your brand.

5. Increased Staff Attrition

Whether you hire an employee who isn’t fully qualified, or one with a criminal background, failing to do a background check affects the entire company. Your other employees will be influenced by the atmosphere that your new team member creates. If it makes the workspace feel unsafe, or leaves team members picking up slack, you could see valued employees depart.

When people find out that you fail to conduct background checks, this could also harm your hiring pool. Future candidates that you want on your team may look elsewhere, while less reputable candidates flock to you due to a lack of entry barriers.

Pre-Recruitment Background Checks the Hassle-Free Way

We get it. You’re worried about spending too much time on the process. And rightly so. Pre-employment background checks take time and resources. The good news is that you can work with a recruitment agency like PrincePerelson.

We know the best background checks to leverage and how to get efficient results. We’ll do the time-consuming work of getting candidates’ approval before taking steps to screen their background, which is critical because job candidates are protected by federal and state regulations that prevent employers from conducting checks without a candidate’s consent. Working with an agency that knows its way around candidate approval requirements can help secure your company against potential lawsuits.

Contact us today and we’ll schedule a personal consultation to get familiar with your unique hiring needs and culture.