Firms that fail to put enough time and effort into background checks and pre-employment screening are at greater risk of suffering from fraud, theft and employee violence, according to a new survey from the U.S.
The study by talent management firm Taleo Research, found more than a quarter (27 per cent) of organisations experienced a major problem.
Ten per cent experienced workplace fraud, a similar percentage suffered employee theft and 7 per cent workplace violence from employees that had been screened but a criminal record not found.
The resulting impact on the company was considerable, said Taleo.
In more than half the cases, it resulted in the employee being fired, with resultant extra recruitment costs.
In five per cent of cases, the company suffered bad press and media exposure.
In more than a quarter of cases, lawsuits union conflicts or some other impact resulted.
More than half – 57 per cent – of those polled believed their organisation should be doing a better job of screening employees prior to being hired.
Just 19 per cent considered their current background check process very effective at weeding out candidates that did not meet the criteria for employment at their company.
Two-thirds of organisations did not conduct ongoing background checks on employees.
Just 29 per cent had ever run an audit of their current screening provider to determine the quality of their screenings, said Taleo.
"Workplace violence, compliance issues, fraud, theft and liability are all significant drivers for increasing concern about the most effective background checking methods," said Alice Snell, vice president of Taleo Research.
"Poor use of electronic data and manual steps for ordering background checks, processing the data and reporting on it can result in high costs and long turnaround times," she added.
"New methodologies and technology platforms can provide improved background checking quality and efficiency that will best safeguard organisations
"We challenge companies to take a close look at their current pre and post hire background screening practices to ensure they are best protecting their organisation against the risks and liabilities that are inherent in today's society," she concluded.