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The estimated cost of a poor hiring decision varies, but research indicates that on average, an organization is likely to lose two and a half times the amount of the person’s annual salary. With this in mind, it is apparent why proper screening and selection procedures are important to avoid financial and operational problems down the road.
Selecting skilled, dependable employees is the starting point for an effective risk control program. So, how do you tell if an applicant will be an asset or a liability to your organization? By incorporating effective screening as part of the selection process, you can remove marginal performers before you bring them into your organization.
The following information provides an overview of the screening and selection process. Information is included on how to attract, screen and select the “right” candidates for your organization. The material is intended to give the hiring decision makers a solid base from which to work.
Introduction to the process
The method that an organization uses to attract, screen and select employees depends on several factors. These factors include the number of employees needed, the workforce turnover rate, the skill level needed, the type of interaction the employee will have with the general public and legal requirements.
No matter what the needs of the organization are, you still need to develop a candidate pool, screen the applicants and make a final selection. You can do all of this in-house or obtain assistance from an outside firm.
Attracting good job candidates requires establishing a good reputation for the organization. Making a concerted effort to promote your company to potential applicants and expressing how the organization can meet their needs will assist in attracting talented employees.
Several methods can be used to find job candidates and advertise open positions within the organization. The following is a list of potential sources:
Temporary employment agencies: can be a good way to “try” out an employee before you commit. (You can require that certain screening be completed before you contract with them)
Prior to screening applicants, it is useful to review the types of positions in the organization and the general tasks and characteristics required for each position. Detailed job descriptions are a good source for this information.
By having a clear understanding of the specific skills required, as well as the potential hazards associated with particular positions, you will be able to qualify candidates and determine screening needs.
The application can be a powerful tool to help narrow down the field of eligible candidates for a position. It is essential to use a job application that asks relevant information in an easy, understandable format. Applications should include the following items:
Biographical information: name, address, etc.
It is important to note that some states have unique requirements for applications. Prior to conducting reference or background checks, it may be a good idea to obtain the applicant’s signature.
Resumes should be neat and brief. They should be no more than one or two pages. Resumes that are too vague or generic are of little value. If a cover letter is included, it should provide a brief introduction of the candidate and a synopsis of his or her qualifications. Resumes should include the following information:
Awards, publications, talents, etc
By incorporating various screening methods, you will be able to gather information necessary to make a wise hiring decision. Because many states have different laws pertaining to screening, you should check the laws in your state and/or consult with an attorney before conducting any screening. The following is a list of some types of screening available:
The types of screening chosen should reflect the level of risk associated with the position and the requirements of the job.
In addition to the interview, psychological screening tools provide additional insight into the personality characteristics of the job applicant. Surveys show that at least one in four job applicants is willing to falsify information to get a job. By only utilizing traditional interview techniques, you are relying on subjective information and allowing the possibility for human error. Pre-employment psychological screening tools provide objective information on each job applicant and a basis on which to compare candidates.
Thorough screening also allows you to narrow the pool of qualified candidates you need to interview, essentially reducing the time and cost associated with the process.
The wrong person for a job can cost your company money. According to the Small Business Administration, for every $1 invested in personnel screening, $5 to $16 is saved in reduced absenteeism, improved productivity, lower turnover, safer working environments, reduced insurance premiums and decreased employer liability. Before you decide which applicant to hire, you need to be sure he or she has the necessary knowledge, skills, abilities and characteristics for a ‘good’ hiring decision.
Thorough screening and selection practices alone do not guarantee that an employee will be a successful, injury-free employee on the job, but it is a good start. It’s important that these practices are only a part of a broader loss prevention program.
For more information, log in to the Risk Control Customer Portal at travelers.com/riskcontrol. (Need help? Read our Registration Quick Guide.) You also can contact your Risk Control consultant or email Ask-Risk-Control@travelers.com.