If human capital is an organization's greatest asset, then it can also be its greatest liability. Just ask the stockholders of Enron, investors in Tyco, or members of the Catholic Church.

None of these institutional calamities occurred because of a natural disaster, political uprising or a radical change in technology. Instead, they are striking examples of how the individuals trusted to bring them to new heights, proved to be their downfall. Consider your own organization; what policies and procedures are in place to ensure your recruit- to-hire program is in fact building human capital assets? If background checks aren't part of your process, consider these recent survey results:

• 9% of job applicants falsely claimed they had a college degree, listed false employers, or identified jobs that didn't exist
• 4% listed incorrect job titles
• 11% misrepresented why they left a former employer
• Nearly 33% listed dates of employment that were off by more than three months
• Nearly 10% of job applicants have a criminal record
• According to the Workplace Violence Research Institute, negligent hiring costs U.S. businesses in excess of $18 billion annually

A solid recruitment program that includes a well-balanced background check will help minimize turnover and liability exposure. If your background checking consists of "Sure, we check references," then your organization is under-informed and at risk. And as odd as it may seem, if you're running a full range of searches on every final candidate, you may be creating liability rather than reducing it. Here are a few broad-stroke considerations.

Do you need a background check policy?

Tragic events of the past several years have brought background checks into everyone's knowledge base. At this point, it's only prudent to have a written policy in place, with specifics that are adhered to in the hiring process.

Who do you check?

The best-case scenario includes a check on all new hires, temps and contractors -- if groups or levels of employment are excluded, the value proposition of your policy is diminished. This will be highlighted for you in court by counsel for the candidate who feels your policy is selective. It's also worth noting that an increasing number of companies are advising vendors that onsite personnel need to meet internal policy minimums.

The degree of background check can and should vary, depending on the responsibilities of the applicant or employee. Most background check providers will create different search packages to address your requirements. However, if your policy includes different degrees of screening, it's critical to keep your checks consistent within job categories or levels. Keep this in mind if promoting from within, so the candidate meets your background check parameters. And consider that many organizations are adopting a policy to run an updated check on employees as part of their review process.

What searches should be included?

This rests with your judgment, although there are some guidelines that might assist. The background check should be relevant to the position and thorough, without being unreasonable. There isn't much difficulty in deciding that a criminal history search should be done across the board - how else would you know if someone poses a danger to fellow employees and clients? Running a credit check on a machinist, however, is probably unnecessary and may be viewed as being intrusive, creating liability where you are trying to minimize it.

The searches conducted as part of the background check will rely in part on information provided by the applicant or employee, but this should not be the sole source:

• Every check should include an Address History/Social Security Number Trace to confirm the applicant's residence history, and the Criminal History search should then be based on those results. If the Address History report matches what the candidate provided, that's great -- if not, ask why.
   
• The Criminal History search should be done at the County Court level (some states also refer to this as District Court) because it involves a researcher obtaining records directly from the court. Many of the online screening firms offer "Statewide" or "Nationwide" criminal record searches, and while there is some value in these searches, a few items should be pointed out. These are database searches, not court searches. The statewide databases frequently rely on Department of Corrections data (frequently no record if they weren't incarcerated) or County convictions data, although not all counties participate. Even the state-run CORI (Criminal Offender Record Investigation) systems are heavily filtered and won't necessarily deliver a record for a convicted felon that served time. The value of these searches comes in their coverage of a large geographic area, although they work best if used to augment a County Court search. The so-called "Nationwide" searches are truly misleading -- they don't include all states, so therefore they can't truthfully be called nationwide and are subject to the same database shortcomings as the statewide criminal searches.
   
• Credentials such as driver's license records are important for positions in sales, delivery, and other areas. Professional licenses should be checked in any profession requiring licensure, and education verifications should be executed for positions requiring a diploma or degree.
   
• Regarding references, please use yourself as the example: have you ever provided a future employer with the name of a reference that wouldn't give a glowing summation? Dates of employment, title, salary, etc., can all be obtained from HR. To get a real feel for performance, you need to speak with a former supervisor or co-worker.

As an HR professional, part of your role is to identify the skills and value that an individual brings to your organization. Of equal importance is your responsibility to create and maintain a safe, secure, and productive work environment. While no single policy or procedure addresses these tasks completely, a comprehensive background check program is one component that will help keep your human capital in the asset category.

Brian McElwee is Vice President of easyBackgrounds.com, a nationwide web-based background check provider. He is a NEHRA member. Brian can be reached at brianm@easybackgrounds.com.