In this tough economy hiring good employees who are both efficient and well-qualified can play a significant role in boosting an employer’s ROI. On the other hand, a bad hire can have a major impact on a company’s bottom line. It’s not uncommon for one poor hiring decision to result in hundreds of thousands of dollars in damage. Today, you’ll discover 4 ways in which employee screening and background checks can translate into a higher ROI.
#1 – Avoids Negligent Hiring Lawsuits
If one or more of your staff is injured at the hands of another employee, there may be grounds for a negligent hiring lawsuit. If an employer failed to properly screen the offending employee, that employer can be sued. Keep in mind that the average settlement for this type of lawsuit is over $1 million.
#2 – Minimizes Employee Turnover
Hiring and training a new employee is expensive. If an employer discovers that the employee has a substance abuse problem, criminal record, or history of violence, there may be a need to replace that person. By conducting pre-employment background checks, employers can avoid bad hires, reducing employee turnover costs in the process.
#3 – Increases Staff Productivity
Along with reducing staff turnover, hiring competent employees increases your staff’s overall productivity. There’s less likelihood of a disruption in the workplace caused by a bad hire. Plus, by limiting turnover, an employer can allocate fewer resources to redundant training.
#4 – Reduces Employee Theft
A bad hire is more likely to commit theft in the workplace. Even small, seemingly benign incidents (for example, stealing a box of pens) can signal the beginning of a habit. Eventually, the employee may begin pilfering valuable assets. Employers can limit employee theft by thoroughly screening applicants before hiring them.
Protecting The Bottom Line
A company’s bottom line involves more than merely revenues and the costs of doing business. Hiring a bad employee can have a devastating effect on an employer’s profitability. Negligent hiring lawsuits, employee turnover, low staff productivity, and employee theft can each have a significant impact. By performing comprehensive background checks and conducting pre-employment screening, employers can protect their staff while boosting their ROI.
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Photo Credit: AMagill