WARNING: By failing to perform background checks on employees,
your business may be open to serious legal and customer relation risks!
Failing to Screen Your Employees Can Cost You!
In at least 28 states, Negligent Hiring and Retention Laws hold
employers liable for willful misconduct by their employees. In some cases,
it does not matter if the actions of the employee occur outside the place
or scope of employment. Failure to screen current and prospective employees
for criminal history and substance abuse can cost your company millions of
Average settlements in negligent hiring cases are now 1.6 million dollars,
according to Liability Consultant’s, Inc. The companies involved
in such lawsuits are often prime candidates for compensating the victim.
This trend can be attributed to the fact that the company is most likely
to have the funds and resources available to do so.
While negligent hiring and retention laws are not necessarily new, claims
have been steadily increasing since the 1980’s. Interest continues
to grow, in not only determining who may be at fault for certain offenses,
but also in compensating the victim. With this trend in place, it’s
likely the rise in negligent hiring and retention lawsuits will continue
at a rapid pace.
Are You Doing Enough To Protect Your Employees?
Criminal behavior is not the only threat to your business. Substance
abuse can also lead to significant damages and monetary loss. The National
Clearinghouse for Drug and Alcohol Abuse reports, “No business
regardless of size is immune to the countless problems that alcohol
and drug abuse can cause. Workplace alcohol, tobacco, and other drug
related problems cost U.S. companies over $100 billion each year".
You can protect your company, employees and customers by performing
pre-employment and random drug screening tests.
As the filing of lawsuits continues to increase, it could be fair
to say that the issue of negligent hiring requires the attention
of every employer. Now, more than ever, employers must understand
what defines negligent hiring and retention, and how they can create
a safe environment through proper hiring practices.
We Can Help!
Would you like some good news? peopletrail.com will help you minimize
risk by performing thorough background investigations and substance
abuse tests before a potential employee is hired. Employment screening
- Insure the safety of all your employees and customers
- Increase company productivity
- Reduce turnover and training costs
- Protect you and your company from liability in a lawsuit
Reduce Costs By Conducting Background Checks
- It costs $7,000 to replace a salaried employee, $10,000 to replace
a mid-level employee, and $40,000 to replace a senior executive.
- Recruiting Times
- The average organization loses more than $9 per day, per employee,
and 6% of its annual revenue to fraud and abuse. - Association
of Certified Fraud Examiners
The American Management Association reported losses to U.S. Business
- Employee pilferage over $10 billion.
- Commercial bribery over $10 billion.
- Embezzlement over $4 billion
- Vandalism over $2.5 billion
- Burglary over $2.5 billion
- Insurance/Workers Compensation fraud over $2 billion.
- Arson over $1.3 billion.
- Computer Fraud over $1 billion.
Real Negligent Hiring Cases
A furniture company was found liable for $2.5 million for negligent
hiring and retention of a deliveryman who savagely attacked a woman
customer in her home. -Tallahassee Furniture Co., Inc. v. Harrison
An employee with a criminal record sexually assaulted a child; $1.75
million awarded for negligent hiring and retention. -Doe v. MCLO
A nursing home was found liable for $235,000 for negligent hiring of
an unlicensed nurse with 56 prior criminal convictions, who assaulted
an 80-year-old visitor. -Deerings West Nursing Center v. Scott
An employer settled for a $2.5 million suit seeking to hold it liable
for negligent hiring, and entrustment of an intoxicated security guard.
The guard had an on-duty traffic accident in a company car which killed
him and another motorist. -Butler v. Hertz Corp
A store customer detained by security guard as a suspected shoplifter
and injured while being restrained was awarded $10 million in damages
in a suit against the store, claiming negligent hiring. -Porter v. Proffitt's,
A $5 million settlement was awarded to the family of a deceased female
tenant against the apartment complex owner and management; the suit
claimed that the tenant was killed by the brother of the complex's assistant
manager, and that it was negligent hiring to hire an assistant manager
without a criminal background check. -Liebman v. Hall Fin. Group, Inc
A vacuum cleaner manufacturer was liabe for $45,000 because one of
its distributors hired a door-to-door salesperson with a criminal record,
who then raped a female customer in her home; (manufacturer should have
required its distributors to do pre-hiring screening of door-to-door
salespersons to prevent hiring of persons with criminal histories).
-McLean v. Kirby Co.
Other Interesting Facts
- A recent study found that 53% of job applications contained
false information. - The Society for Human Resource Managers
- If recent incarceration rates remain unchanged, an estimated
1 of every 20 persons (5.1%) will serve time in a prison during
their lifetime. - Bureau of Justice Statistics
- 30% of business failures are due to poor hiring practices. -
Department of Commerce
- On average in U.S. businesses, at least half of all new hires
don't work out. - Fortune Magazine, Feb. 7, 2000, page 52
Contact us to
setup the best possible legally compliant background-screening program
designed for your specific needs.