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Chapter 6 - Applicant Screening and Employee Socialization

Security and Loss Prevention: An Introduction, 5th Edition

by Philip P. Purpura

Screening Methods

Screening methods vary among organizations and depend on such factors as regulatory requirements of

certain industries, budget, the number of personnel available to investigate applicants, outsourcing to

service firms, and the types of positions open. Certain employers expend minimal efforts to properly

screen, using the excuse that their hands are tied because of legal barriers. Others follow legal guidelines

and screen carefully. The EEOC, the Office of Personnel Management, and the Departments of Justice

and Labor have adopted and published the "Uniform Guidelines on Employee Selection Procedures,"

which is periodically updated and serves as a guide for determining the proper use of tests and other

selection procedures for any employment decision such as hiring, promotion, demotion, retention, training,

and transfers. These guidelines also contain technical standards and documentation requirements for the

validation of selection procedures as described in the "Standards for Educational and Psychological Tests,"

prepared by the American Psychological Association and other groups. Courts rely on such guidelines in

deciding cases.

Negligent hiring is a serious problem resulting from an employee who was an unfit candidate for hiring

and retention. The courts have established screening standards from negligence cases; awards have been

made to victims who have sued, claiming the employer was negligent in not conducting a reasonable

inquiry into the background of an employee who, for example, had a history of physical violence. The term

reasonable inquiry has various definitions. The theory supporting negligent hiring involves foreseeability. It

is defined as follows by Black (1991 : 449): "The ability to see or know in advance; e.g. the reasonable

anticipation that harm or injury is a likely result from certain acts or omissions. In tort law, the

‘foreseeability’ element of proximate cause is established by proof that an actor, as person of ordinary

intelligence and prudence, should reasonably have anticipated danger to others created by his negligent

act." An employer can take a number of steps to screen applicants and prevent negligent hiring.

First, careful planning is required. Input from a competent attorney can strengthen the legality of the

screening process. No single screening tool should be used to assess an applicant. Multiple measures

always are best .

It is important that the job duties and qualifications be clearly defined through a job analysis. Noe et al.

(2006 : 151–157) write that there is no "one best way" for analyzing jobs. They offer various methods of job

analysis that include questionnaires focusing on topics such as work behaviors, work conditions, and job

characteristics. An important point they make is that errors in the job analysis process result mostly from

job descriptions (based on job analyses) being outdated because of our rapidly changing world.

Help-wanted advertisements should be worded carefully to attract only those who meet the requirements of

the job. This also prevents expensive turnover and charges of discrimination.

To save money, the most expensive screening methods should be performed last . The time and labor

spent reading application forms is less expensive than conducting background investigations.

An employer can be held liable for negligent hiring if an employee causes harm that could have been

prevented if the employer had conducted a reasonable background check. Resumes and Applications

Applications must be carefully studied. Job seekers are notorious for exaggerating and actually lying. The

Port Authority of New York and New Jersey did a study by using a questionnaire to ask applicants if they

had ever used certain equipment that really did not exist. More than one-third of the applicants said that

they had experience with the nonexistent equipment ( "Lying on Job Applications May Be Widespread,"

1988 : 13).

Diploma mills , which provide a "degree" for a fee, with little or no work, are another problem. Research in

the 1990s showed not only that one-third of resumes were fraudulent, but that the problem was increasing

(Bachler, 1995 : 51–60). Employers then began more thorough checks of applicant backgrounds and

whether the degree granting institution of applicants was accredited. Then diploma mill con artists came up

with bogus accreditation associations; watermarks, holographs, and encrypting on the diplomas; and toll-

free numbers so employers can "verify" the graduate. Today, the problem is compounded by on-line

degree programs and the difficulty of distinguishing between quality on-line degree programs and bogus

programs. Databases that list accredited schools may list only those that receive federal financial aid.

There is no national accrediting body, only regional ones. Solutions include carefully studying transcripts,

asking specific questions about course work, requesting samples of course work (e.g., research papers),

and being cautious about credit for "life education" ( "Fighting Diploma Mills by Degrees," 2005 : 18).

Signs of deception on resumes and applications include inconsistencies in verbal and written statements

and among background documents. Periods of "self-employment" may be used to hide institutionalization.

Not signing an application may be another indicator of deception. Social Security numbers are issued by

the state, and that can assist in verifying past residence. A thorough background investigation is

indispensable to support information presented by the applicant.

Employers are increasingly adding clauses and disclaimers to applications. Clauses include a statement on

EEO and AA, employment at will (i.e., employer's decision to terminate employees), and the resolution of

grievances through arbitration rather than litigation. Disclaimers warn an applicant of refusal to hire or

discharge for misstatements or omissions on the application.

Today, most companies use the Internet to recruit applicants by including a recruitment section in their

Web site. The use of the Internet to solicit applications has its advantages and disadvantages. Advantages,

when compared to traditional recruitment methods, include the opportunity to attract more applicants

globally, lower cost, convenience, and speed. Disadvantages include the workload of possibly screening

numerous applications, ignoring other means of recruiting, and hiring too quickly without screening

properly.

Applicants also establish their own Web sites containing their resume and other information. Because

"Googling" a name is simple, applicants may place themselves at a competitive disadvantage if they

establish a Web site or blog that contains information, photographs, or art that would be offensive to an

employer.

Interview

When the applicant is asked general questions about work experience and education, open-ended

questions should be formulated so the interviewee can talk at length. "What were your duties at that job?"

elicits more information than short-answer questions requiring "yes" or "no" responses. Answers to

questions should be compared to the application and resume.

Some employers ask the applicant to complete an application at home to be mailed in before the interview.

Before the interview, while the applicant is waiting in an office, he or she is asked to complete another

application. Both applications are then compared before the interview for consistency. Many employers

require the application to be completed on-line.

The following information concerns questions prohibited during the entire screening process, including the

application form. Court rulings under EEO legislation have stressed repeatedly that questions (and tests)

must be job related. This legal requirement is known as a bona fide occupational qualification (BFOQ). Questions pertaining to arrest records generally are unlawful, but it depends on the position. An arrest

does not signify guilt. The courts have stated that minority group members have suffered disproportionately

more arrests than others. A question that asks about a conviction, however, may be solicited. It is not an

absolute bar to employment. Here again, minority group members have disproportionately more

convictions. Certain offenses can cause an employer to exclude an applicant, depending on the particular

job. Therefore, questions of arrest and conviction must be job related (e.g., related to loss prevention) and

carefully considered.

Unless a "business necessity" can be shown, questions concerning credit records, charge accounts, and

owning one's own home are discriminatory because minority group applicants often are poorer than others.

Unless absolutely necessary for a particular job, height, weight, and other physical requirements are

discriminatory against certain minority groups (e.g., Latino, Asian, and women applicants often are

physically smaller than other applicants).

Other unlawful questions, unless job related, include asking age, sex, color, or race; maiden name of

applicant's wife or mother; and membership in organizations that reveal race, religion, or national origin.

The questions that can be asked of an applicant and on an application form, among others, are name,

address, telephone number, Social Security number, past experience and salary, reasons for leaving past

jobs, education, convictions, U.S. citizenship, military experience in U.S. forces, and hobbies.

Under the ADA, an employer may ask applicants if they need reasonable accommodations for the hiring

process. If the answer is yes, the employer may ask for reasonable documentation concerning the

disability. Generally, the employer may not ask whether an applicant will need reasonable

accommodations to do the job; however, pre-employment inquiries can be made regarding the ability of the

applicant to perform job-related functions ( Twomey et al., 2001 : 789).

Extensive research on the interview process shows that without proper care, it can be unreliable, low in

validity, and biased against certain groups. In Watson v. Fort Worth Bank and Trust, 108 Supreme Court

2791 (1988), the Court ruled that subjective selection methods such as the interview must be validated by

traditional criterion-related or content-validation procedures. Research has pointed to concrete steps that

can be taken to increase the utility of the personnel selection interview. First, the interview should be

structured, standardized, and focused on a small number of goals (e.g., interpersonal style or ability to

express oneself). Second, ask questions dealing with specific situations (e.g., "As a security officer, what

would you do if you saw a robbery in progress?"). Third, use multiple interviewers and ensure that women

and minority group members are represented to include their perspectives on the applicants ( Noe et al.,

2006 : 234–235).

Validity asks how accurately a test predicts job success. Reliability asks if a test is consistent in

measuring performance.

Tests

The testing of applicants varies considerably. Here is a summary of various types of tests ( DeCenzo and

Robbins, 2005 : 94–96, 179–180; Noe et al., 2006 : 239–244).

◾ Physical ability tests may predict performance and occupational injuries and disabilities.

These tests are likely to have an adverse impact on applicants with disabilities and women.

However, key questions are as follows: Is the physical ability essential for the job and is it

mentioned prominently in the job description? Is there a probability that the inability to

perform the job would cause risk to the safety or health of the applicant or others?

◾ Cognitive ability tests measure a person's ability (e.g., verbal, quantitative, reasoning) to

learn and perform a job. Highly reliable commercial tests that measure cognitive abilities are

available, and they are generally valid predictors of job performance. The predictive validity of

these tests is higher for jobs that are subject to change and require adaptability. Cognitive

ability tests typically have an adverse impact on the hiring of minority group members, and

some have favored abandoning these tests. ◾ Personality inventories attempt to measure personality characteristics and categorize

applicants by what they are like, such as agreeable and conscientious. When such tests ask

job applicants to answer intimate questions, such as their sex practices, class action lawsuits

can result. These tests have been criticized for questionable validity and low reliability.

◾ Assessment center is a method to test applicants on their ability to handle duties encountered

on the job. Multiple raters evaluate applicant performance on exercises, such as how to

respond to an e-mail from a customer who has a complaint. These tests are expensive to

prepare, job content validity is high, and they are low in adverse impact.

◾ Medical examinations are given to determine whether applicants are physically capable of

performing the job. The ADA requires employers to make medical inquiries directly related to

the applicant's ability to perform job-related duties and requires employers to make

reasonable accommodations to help handicapped individuals to perform the job. This act

requires that the medical exam cannot be conducted until after the job offer has been

provided to the applicant.

◾ Honesty tests are paper-and-pencil tests that measure trustworthiness and attitudes toward

honesty. Thousands of companies have used this evaluation tool on millions of workers, and

its use is increasing as employers deal with the legal restrictions of the polygraph. These

tests have helped employers screen job candidates, and validity and reliability studies have

been published in scholarly journals.

◾ Drug tests have grown dramatically in a drug-oriented world. Employers expect workers to

perform their jobs free from the influence of intoxicating substances, and accidents must be

prevented. The opposing view favors protection from an invasion of an individual's right to

privacy. Employers in regulated or safety-sensitive industries are required by law to test for

alcohol or drugs. Numerous employers conduct such tests as a loss prevention measure.

Drug tests vary in terms of cost, quality, and accuracy. A drug test can result in a "false

positive," showing that a person tested has used drugs when that is not so. A "false negative"

can show that the individual has not used drugs when, in fact, the opposite is true. Another

problem with drug testing is cheating. Simply stated, if an observer is not present when a

urine sample is requested, a variety of ploys may be used by an abuser to deceive an

employer. For example, "clean" urine may be substituted. Such deception is a huge problem.

Another strategy of drug testing is to measure drug usage from a sample of a person's hair.

Some experts view this method as more accurate than urine sampling.

Hire the Right Person, Not the Wrong One!

An error in hiring can bring crime to the workplace, loss of proprietary information, and litigation.

Security managers have a duty to work with employers to avoid hiring an employee who

◾ Has been convicted of embezzlement, but is handling accounts payable

◾ Has a history of convictions for computer crimes, but is a corporate IT specialist

◾ Has a history of convictions for felony drug offenses, robberies, and burglaries, but is

working with the cleaning crew

◾ Has been convicted of securities violations and insider trading, but is working in the

corporate public information department

◾ Has a history of child molestation convictions, but is working in corporate daycare

◾ Is a convicted rapist, but is working as a security officer escorting female employees to

their vehicles at night

◾ As a temporary employee is collecting trash throughout the premises and is really a

news reporter seeking a story ◾ While working in research and development, is really an industrial spy collecting

information to sell to a competitor

◾ Has been hired as a security officer, but is really a terrorist and the "inside person"

Background Investigations

With restrictions on the use of the polygraph, employers have turned to background investigations to verify

job applicant information. This can range from inquiries made by the employer to the use of a credit

reporting agency, a background investigative firm, or private investigator.

Numerous laws pertain to background investigations. The Sarbanes-Oxley (SOX) Act of 2002 requires

publicly traded companies to conduct background investigations, especially for applicants for positions

involving financial matters, trade secrets, IT systems, and other sensitive areas. Employers must also

adhere to privacy laws pertaining to the acquisition and protection of sensitive background information

(e.g., financial, health).

The Fair Credit Reporting Act of 1971 (FCRA), enforced by the Federal Trade Commission, is a major

law that seeks to protect consumers from abuses of credit reporting agencies while controlling many

aspects of background and other types of investigations. (State laws must also be considered.) If a

company conducts investigations with in-house investigators, instead of contracting the work to a service

firm, the impact of the FCRA may be less burdensome. However, most companies cannot afford in-house

investigators.

Under the FCRA, an employer is required to notify a job applicant that a background report will be obtained

from an outside firm. The employer must receive written permission from the applicant prior to seeking a

report. Some states require that a free copy be provided to the applicant. An employer who takes "adverse

action" (e.g., not hiring) against the applicant, based on the report (credit, criminal, or otherwise), must do

the following: notify the applicant about the development, show the applicant the report, provide information

on the applicant's rights under the FCRA, and allow the applicant to dispute any inaccurate information in

the report with the reporting agency. Following this process, if the employer still takes adverse action, the

applicant must be notified of the action, with justification.

The EEOC has issued guidelines to protect applicants against discrimination from background

investigations. For example, before an employer makes an adverse decision on hiring or promoting based

on the candidate's personal financial data, the information should be job related, current, and severe. An

employer, for instance, may decide not to offer a financial position to a candidate who has serious, current

debt. The FCRA prohibits the use of negative information that is older than seven years. Applicants can

bring legal action if they are rejected because of a poor credit record but can show good reasons for their

financial problems ( Giles, 2000 : 107–111).

In an amendment to the FCRA in 2003, ASIS International and other groups were able to lobby for a

provision in the law that removes workplace misconduct investigations (e.g., theft, violence, harassment)

from the notice and disclosure requirements of the act. This occurred through the Fair and Accurate

Credit Transaction Act of 2003 , also called the FACT Act. Prior to this amendment, employers who used

outside investigative firms for cases of employee misconduct were required to notify the suspect prior to

the investigation, which could result in evidence or witness tampering.

An applicant's criminal history, if any, is a prime concern of employers, especially when the applicant is

applying for a security position. Asking about an applicant's arrest record is generally unlawful, but

conviction records legally are obtainable in most jurisdictions; they usually are public records on file at

court offices. If an applicant appears to have no convictions, it is possible that the background investigator

did not search court records in other jurisdictions where the applicant has lived.

The FBI's National Crime Information Center (NCIC) database holds an enormous amount of information

on offenders and stolen items. However, its use is restricted to criminal justice agencies. For the screening

of security officers, refer to Chapter 2 for the Private Security Officer Employment Authorization Act of 2004

that enables private security organizations to check with the FBI on security applicants. Past employment is a crucial area of inquiry because it reveals past job performance. A customary

response by employers is to provide dates of employment, positions, and salary. However, human

resources offices may be reluctant to supply negative information because of the potential for a defamation

suit. Many states have passed job reference immunity statutes that shield employers from lawsuits when

sharing adverse information with other employers on employee or former employee work history. For

protection, employer statements must be truthful, made in good faith, and made for a legitimate purpose. In

those states with such laws, a copy of the law can be attached to the release (to be signed by the

applicant) authorizing the background check; this may prompt the applicant and the former employer to

release more information. Also, the previous employer can be tactfully advised that withholding information

could result in liability for negligent referral ( Nixon, 2005 ).

The personal references supplied by the applicant usually are those of people who will make favorable

comments about the applicant. If an investigator can obtain additional references from contacting

references, more will be learned about the applicant.

Most colleges will verify an applicant's attendance and degree over the telephone. College transcripts can

be checked out by mail as long as a copy of the applicant's authorization is enclosed. This conforms to

privacy legislation. When educational records are received, the investigator should study characteristics

and look for inconsistencies.

The private use of public records is on the increase for background investigations. As we know, conviction

records are available in most jurisdictions. Records from state motor vehicle departments can reveal a

history of careless driving behavior. A motor vehicle report (MVR) can serve as a cross-check for name,

date of birth, and physical description. Federal court records expose violations of federal laws, civil

litigation, and bankruptcy. Chapter 10 discusses online databases for acquiring information.

Nadell (2004 : 108–116) offers seven steps to effective background checks to protect organizations from

negligent hiring allegations while promoting a safe and secure environment:

1. Prepare and distribute to all employees a background screening policy that conforms to all

state and federal laws. This lets employees know that promotions depend on background

screening.

2. Communicate the policy by placing signs at select locations on the premises.

3. Place a notice about background screening and drug testing on the company Web site.

4. Disclose the screening methods to job applicants.

5. Use the job application process to ask all legally allowable questions.

6. Ensure that temporary employment agencies perform background checks and request a copy

of the check.

7. Ensure that vendors and contractors perform background checks and request a copy of the

check.

History and Controversy: Polygraph and PSE

Background information on the polygraph and psychological stress evaluator (PSE) will assist the

reader in understanding the controversy and subsequent legal restrictions on these devices. In 1895,

Cesare Lombroso used the first scientific instrument to detect deception through changes in pulse and

blood pressure. In 1921, Dr. John A. Larson developed the polygraph, which measured blood

pressure, respiration, and pulse. By 1949, Leonard Keeler added galvanic skin response (i.e.,

electrical changes on the surface of the skin).

The PSE was developed for the U.S. Army in 1964 by Robert McQuiston, Allan Bell, and Wilson Ford.

After it was rejected by the Army, McQuiston patented a civilian version and marketed it to the private

sector.

When questions are asked during a polygraph exam, bodily changes are recorded on graph paper or a

computer. The examiner interprets these readings with reference to questions asked. Persons have been known to try to "fool" the polygraph by biting their tongues or pressing a toe into a thumbtack

previously hidden in their shoes. The PSE has a few variations, but basically it records voice stress as

questions are asked. There is no hookup, so it can be used covertly.

A disadvantage of the PSE is that only one factor is being recorded, as opposed to the multiple factors

of the polygraph. Training for administering and interpreting the PSE is shorter than for the polygraph.

The accuracy of either device is subject to considerable debate, especially concerning the PSE.

University of Utah research concluded that the polygraph can be over 90% accurate ( U.S. Department

of Justice, 1978 : 8). Gardner and Anderson (2007 : 240) write that "… in 2002 a panel of leading

scientists confirmed a US congressional study done in 1983, with both studies reporting that lie

detector tests do a poor job of identifying spies or other national security risks and are likely in security

screening to produce false accusations about innocent people." Much depends on the training and

skill of the examiner behind the device. The polygraph has been responsible for eliminating

undesirable job applicants, in addition to assisting with criminal and civil cases, but at the same time,

abuses have occurred that resulted in the passage of the Employee Polygraph Protection Act.

Employee Polygraph Protection Act of 1988

The Employee Polygraph Protection Act of 1988 (EPPA) was passed by Congress and signed into

law by then-president Ronald Reagan on June 27, 1988. It became effective on December 27. The act

prohibits most private employers from using polygraph or "lie detector" tests to screen job applicants

and greatly restricts the use of these instruments to test present employees. The EPPA defines the

term lie detector to include any device that is used to render a diagnostic opinion regarding the

honesty of an individual. The congressional Office of Technology Assessment estimated that 2 million

polygraph exams had been conducted each year—90% by private employers.

The EPPA states that it is unlawful for an employer to directly or indirectly force an employee to submit

to a polygraph test. Discrimination against those who refuse to be tested or who file a complaint under

the EPPA is prohibited. Employers who violate the EPPA may be assessed a civil penalty up to

$10,000 for each violation. In addition, the Secretary of Labor may seek a restraining order enjoining

the employer from violating the act. The law provides individuals with the right to sue employers in

federal and state courts for employment reinstatement, promotion, and payment of lost wages and

benefits.

A few kinds of employees are exempt from the act and can be tested, including employees of

◾ National security organizations or defense industries

◾ Federal, state, and local governments

◾ Businesses involved with controlled substances

◾ Certain security service firms, such as armored car or security alarm firms

In addition, a limited exemption exists for any employer who is conducting an ongoing investigation

involving economic loss or injury; the suspect employee must have had access to the subject of the

investigation, and reasonable suspicion must be present. Considerable justification and documentation

is required. Chapter 10 contains proper testing procedures under the EPPA.

Should the EPPA be amended to permit more widespread use of the polygraph in the workplace to

screen job applicants for honesty?

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