Employers are increasingly being held liable for the actions of their employees under the expanding legal doctrines of negligent hiring and negligent retention. These doctrines impose liability upon an employer who fails to reasonably inquire into the background of a prospective or existing employee. For more information on the legal issues involved with employee background investigations, click here.

Beyond the legalities, there are many practical reasons to perform a background check. A thorough background check will reveal red flags or other issues which could indicate whether or not a candidate will fit within your organization. Companies spend considerable amounts on employee training and development that are wasted when an employee doesn’t work out. Also, problem employees utilize considerable corporate resources. The best companies use background checks to make informed hiring decisions so as to avoid these problems.
 

The best precaution is to hire a professional investigative firm. There are many companies who claim to have the expertise, but quality and accuracy are not always their primary concern. Seek out references and request "test" cases before choosing a vendor. If one company is more expensive than another, it is probably because they provide more comprehensive reporting. Cheap database companies may offer quick and inexpensive results but their data may be outdated. Other companies are mere record retrievers who are not trained to spot red flags in an application or resume. Remember the maxim, “you get what you pay for.”

No, it should not be. This is exactly the type of person who should be required to undergo a background check. The individual will probably fill a position of high risk - that is, one with access to critical corporate records and data. The individual will also be an important representative of the company. Failing to conduct an inquiry in these cases would be remiss, if not negligent.

A background check normally takes 3 to 5 days to complete and can range from $50 to several hundred dollars, depending on the scope of the investigation.

Yes. That is another reason to use a national investigative firm. RAI has affiliates providing seamless coverage in North America and in every major location throughout the world. This level of coverage is an absolute necessity in today’s highly mobile society. Also, technological advances have made it easier and inexpensive to conduct inquiries almost anywhere in the world.

A business investigation, also called due diligence, is an investigation into the background of a company and its principals. The depth of the investigation may vary depending upon several factors including the nature of the transaction and the industry involved. The investigation may involve a credibility assessment of a company through court record checks, organized crime inquiries and a review of financial information. It is a perfectly legal and acceptable way for companies to ensure that the people they do business with are reliable and above reproach.

Due diligence should be performed before entering into any business relationship, and is especially critical under the following circumstances:

• Taking on new client
• Mergers and acquisitions
• IPOs being handled by your firm, or in which you may invest.
• Choosing a stock or bond broker
• Forming a partnership
• New licensing agreements
• Franchising agreements

Every company should take steps to verify the credibility and dependability of the people they do business with. A negative association can hurt your business in many ways. An undependable supplier can hurt your ability to satisfy your clients. An association with an unscrupulous business or individual can harm your bottom line and generate negative publicity, ruining your reputation. There are many ways for people to commit fraud through shell companies with impressive web sites and letterhead. Due diligence is akin to buying an insurance policy against fraud.