The Higher Cost of Hiring the Wrong Employee

An Argument for Proactivity in the Background Screening Process

Time and money are often arguments used against doing something. In our world of human resources and staffing, we help set the curve on those arguments and add a couple of others for good measure. However, as we head into a new decade, we all know there are stronger reasons to abandon historical reservations against background screening incoming employees. 

The first pushback is often financial. But do you know a background check usually costs less than you pay a new employee in salary before noon on their first day of work? A bargain when it’s addressed in those terms and measured against the cost of hiring the wrong employee.

There are two other common arguments against screening.

AGAINST – My turnover is high; it’s a waste of money!

Maybe in some part, your turnover is high because you’re NOT screening? When you don’t know who you are hiring, it becomes harder to nail down why they’re leaving. And the risk doesn’t directly go away just because your average employee works for six months and not six years. 

AGAINST – If I screen, I won’t be able to hire anyone!

Deciding whether to screen and deciding whether to hire are two different things. Consider this; If your argument against screening is, you wouldn’t hire them based on the results of a background check, why would you hire them without knowing?

On the flip side, these are two common arguments for screening.

FOR – If I could have known, I should have known. 

Background checks are cheaper, faster, and more accurate today than ever before. While it can seem a significant burden to screen, this is most likely the case when you’re using a platform that doesn’t help lift the weight. The cost of negligent hiring is real. And it’s incredibly high. Take, for instance. The Financial Industry Regulatory Authority (FINRA) fined J.P. Morgan Securities, LLC 1.25 million for inadequately screening 8,600 individuals for felony convictions or financial regulation disciplinary actions. Or this; FINRA fines Citigroup Global Markets for hiring three convicted criminals over seven years after they failed to run adequate background checks on more than 10,000 employees. Estimates for average negligent hiring claims quickly run into the hundreds of thousands of dollars, sometimes millions. And if that’s not enough, bad hires alone can cost tens of thousands of dollars per person. Just screen instead and save yourself legal action and money.

FOR – Candidates won’t take a different job a day earlier because you chose to screen and someone else didn’t

Again, background checks are cheaper, faster, and more accurate today. And yes, it’s a low unemployment environment, but job seekers are not universally juggling three offers at the same time from your competitors. And they’re not deciding where to or where not to work based solely on completing a background check a day later. And lastly? According to several reputable HR studies, 90%-95% of employers are doing a background check as well. You’re not alone.

Background screening has always been a useful risk management tool. A candidate who accepts a job somewhere else or an open position that stays that way a little longer is a short-term business problem that is dwarfed by the broader organizational benefit of a quality, compliant screening program. 

Proactive is the name of the game. No one enjoys starting a conversation with a background screening provider…” so I hired this person without doing a background check…!”

We’d love to share with you how Vetty can make the process easier, efficient, and compliant. 

Book a quick demo with us today. You’ll be glad you did.

Background checks are cheaper, faster, and more accurate today than ever before. While it can seem a significant burden to screen, this is most likely the case when you’re using a platform that doesn’t help lift the weight.
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