Due Diligence & Hiring Mistakes

One out of every three resumes has false information, with 10 percent of these being serious-enough misrepresentations to cause a prospective employer to pass on an applicant. About one in every twelve people lie about their academic degrees. If getting what they're bargaining for is not enough incentive for employers to check out prospective employees thoroughly, then the courts are providing additional motivation. Courts are finding companies negligent in cases where they have failed to perform due diligence on the employees the hired. They're not the only ones being held liable in court: Former employers who fail during a reference check to disclose vital information such as a terminated employee's history of violence are being sued as well.

As a result, most companies today are checking into the background of prospective employees. Some companies have in-house staff who do this work, using databases such as www.knowx.com, www.informus.com, www.advsearch.com, www.digidirt.com, and www.people-wise.com. Others retain a security consultant, private investigator, or a consultant who specializes in background checking. Either way, companies that do not perform due diligence are begging for trouble.