The small business sector is a huge area of employment in any economy, and it is often one left behind as far as information is concerned, by the big players. Small businesses are just as prone to internal theft, fraud, and stealing of intellectual property and information as any other larger business. Most of the time small businesses are missed when it comes to dissemination of information about protecting themselves against internal theft and fraud. This is largely due to the fact that these businesses are largely independent operators. Only occasionally are they involved with a chain, union or guild to pass on HR information.
It is vitally important for small businesses to protect themselves against internal theft and fraud. These businesses tend to be more vulnerable, and more likely to suffer major consequences of fraud. If they suffer a large loss, this could potentially be the demise of that business. Often loss is insidious, and owners/managers are just not aware that it is happening until it is too late. I know of many situations where small business owners have very nearly folded due to theft by employees they trusted. To make matters worse, these employees had been with them for years, had probably been thieving for years, and interestingly enough – all employees had a history of similar behaviour.
Risk management
Risk management is often a term used by big business, however risk management is vitally important to all businesses, large or small. One of the easiest ways for a small business operator to eliminate a huge degree of risk is to tighten up employment procedures. You need to ask yourself:
– Does my business have an employment procedure?
– Is it worth my time to check out an employee? They have mostly been OK in the past…
– Do I check references?
– What should a professional pre-employment screen include?
Often business owners aren’t even aware that there are pre-employment screening products available on the market. If they are aware, there may be the pre-conception that screening is an expensive process that is not affordable.
Pre-employment screening is necessary and affordable.
Does my business have an employment procedure?
You need to have an employment procedure. Many employers are remiss when it comes to employing staff. Often there is the “let’s suck it and see” approach, or the “she’ll be right” approach. A lot of the time as an employer, you need someone to fill a role quickly, someone to stand behind a counter and smile, carry tools or fill a spot on a production line. The perceived hierarchy of a job does not determine whether or not a pre-employment screen should or should not be done. A lower ranked employee is just as likely to commit fraud or theft as a higher ranking employee.
I will follow up with an article on employment procedure.
Is it worth my time to check out an employee?
Yes, it is most certainly worth your time. If you haven’t got the time or the skills to do this properly, get experts to do it for you. Considering a basic pre-employment screen can cost less than an employees’ day’s wages, just do it!
Do I check references?
You need to check references properly. Are you asking the right sorts of questions? Are you finding out what you really need to know? If you aren’t sure, get experts to do this for you.
What should a thorough professional pre-employment screen tailored to small business include?
(This example is based on a standard check in Australia, individual countries may differ.)
Criminal record – including a comprehensive check of sex offender database. A Police Clearance Certificate should be offered. This may attract an additional cost and may take up to 12 weeks.
Driving Record – confirm that a subject holds a valid driving licence and obtain details of any traffic infringements.
Civil Record/Bankruptcy – records of bankruptcies, civil court findings and defaults on debt.
Residence – confirmation of Electoral Roll data and other residential data. Is your potential employee allowed to work in Australia?
Previous Employment – Prompt investigative reference checks. Associates such as line managers and former colleagues need to be contacted, so you know the character of the person you are hiring, not just their qualifications.
Education – confirmation of qualifications and attendance as far back as High School if required.
Professional Memberships – accurate and reliable information about a candidate’s professional standing.
National Regulatory Bodies – reports regulated by the Federal or State and Territory Governments.
Real Estate – Property ownerships are recorded on a State or Territory basis in Australia
Conclusion
Small businesses need to address their employment procedures to protect themselves against fraud and internal theft. If you aren’t confident in checking out your potential employees, or you don’t have the time to check out your potential employees, employ an expert to do the job for you. Pre-employment screening is an essential part of running a successful, ethical business. You can’t afford not to screen your staff.
