ASIS Breakfast Seminar:Pre-employment Screening: ACorporate PerspectiveJeremy Stone, CPP28 February 2011AIA.COM
Agenda1.   What is Pre-employment Screening?2.   Why Conduct Screening?3.   Available Types of Check4.   Screening Program...
1What is Pre-employment      Screening?                         3
Definitions           Pre-employment Screening:  A process for determining whether a prospectiveemployee is trustworthy or...
2Why Conduct Screening?                         5
Discourage False Applications• CV exaggeration commonplace• According to Monster UK (2007):  –   66% candidates prepared t...
Promote Safe/Secure Workplaces• In US > 1.0 M workplace violence  cases p.a.• According to US EOC (2007):  –   31% of fema...
Support Anti-Fraud Policy             Perpetrators of Fraud by Industry        Universal              44                  ...
Support Anti-Fraud Policy               Profile of External Fraudsters                               Profile of Internal F...
Reduce Lawsuit Exposure• Neglecting hiring lawsuits• Negligent retention lawsuits• Other vicarious liability lawsuits  In ...
Promote Compliance & GovernanceDemonstrate to:• Employees• Customers• Regulators• Shareholders• Future Investors          ...
Reduce Poor Hiring Decisions & StaffTurnover Costs                                       12
Attract & Retain Well Qualified Candidates                                             13
3Available Types of Check                           14
PES Checks ShouldVerify information about subject’s:• Identity & Contact Particulars• Academic Awards• Professional Qualif...
Checks Available by JurisdictionCountry       Education & Employment     Credit           Criminal    COI or      Financia...
4Screening Program  Considerations                    17
Legal IssuesData Privacy Laws• Purpose & manner of collection.• Accuracy and duration of retention• Use of personal data• ...
In-house or Out-sourced?In-house• Corporate Security Department• Human Resources Department• Do they have requisite expert...
Screening Program Flaws• Many organizations fail to:   – Seek independent verification   – Check criminal & civil litigati...
PES Policy ContentsPolicy Statement:                  Roles & Responsibilities• Conduct & Integrity              • Corpora...
Discrepancy Management• Discrepancy reports & red flags need to be:  –   Analyzed  –   Clarified  –   Categorized  –   Esc...
Adjudicating Panels• Comprises of:  – Corporate Security  – HR Manager  – Hiring Manager• If cannot resolve, can  also inc...
Discrepancy Case Actions70%       61%60%50%          39%40%                   31%30%20%10%                      3%   6%0% ...
5Conclusion             25
ConclusionPES can be an effective risk management tool:•   If the program is carefully planned•   Detailed policy document...
Questions            27
Contact            Jeremy Stone, CPP  Deputy Head – Group Corporate Security American International Assurance Co., Ltd.   ...
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Pre-employment Screening: A Corporate Perspective Asis Seminar

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Pre-employment Screening: A Corporate Perspective Asis Seminar

  1. 1. ASIS Breakfast Seminar:Pre-employment Screening: ACorporate PerspectiveJeremy Stone, CPP28 February 2011AIA.COM
  2. 2. Agenda1. What is Pre-employment Screening?2. Why Conduct Screening?3. Available Types of Check4. Screening Program Considerations5. Conclusion6. Q&A 2
  3. 3. 1What is Pre-employment Screening? 3
  4. 4. Definitions Pre-employment Screening: A process for determining whether a prospectiveemployee is trustworthy or capable of performing the functions required by the job. Background Verification/Check: The process of checking an individual’s character, general reputation, personal characteristics, or … [lifestyle] for consideration of employment, promotion, access to sensitive assets … or for continued employment. ASIS International (2010), International glossary of security terms. Retrieved February 25, 2011 from http://www.asisonline.org/library/glossary/index.xml. 4
  5. 5. 2Why Conduct Screening? 5
  6. 6. Discourage False Applications• CV exaggeration commonplace• According to Monster UK (2007): – 66% candidates prepared to lie – 40% lie about reason left last job – 18% lie about last salary – 10% lie about qualifications• Diploma Mills• Fake Academic Certificates• Fake Qualifications 6
  7. 7. Promote Safe/Secure Workplaces• In US > 1.0 M workplace violence cases p.a.• According to US EOC (2007): – 31% of female workers harassed – 7% of male workers harassed – 62% of targets took no action – 43% harassed by supervisor – 27% harassed by a senior employee – 19% harassed by coworker – 8% harassed by a junior employee 7
  8. 8. Support Anti-Fraud Policy Perpetrators of Fraud by Industry Universal 44 53 Entertainment 41 69 Manufacturing 23 74 Hospitality 24 76 Technology 60 45 Communications 55 39 Insurance 65 35 Financial 73 25 0% 50% 100% % reported frauds External Internal Unknown Price Waterhouse Coopers (2009). The global economic crime survey..Retrieved February 25, 2011 from http://www.pwc.com/gx/en/economic-crime-survey/download-economic-crime-people-culture- controls.jhtml 8
  9. 9. Support Anti-Fraud Policy Profile of External Fraudsters Profile of Internal Fraudsters Customers 45 Junior Employees 42Agents/Intermediaries 20 Middle Mgmt 42 Vendors 10 Senior Execs 14 Other Third Parties 25 Other Employees 2 0 10 20 30 40 50 0 10 20 30 40 50 % reported frauds % reported frauds 44% 53% Price Waterhouse Coopers (2009). The global economic crime survey..Retrieved February 25, 2011 from http://www.pwc.com/gx/en/economic-crime-survey/download-economic-crime-people-culture- controls.jhtml 9
  10. 10. Reduce Lawsuit Exposure• Neglecting hiring lawsuits• Negligent retention lawsuits• Other vicarious liability lawsuits In common law jurisdictions, employers can be held liable under tort law if they negligently provided an employee with ability to engage in an act resulting in injury to another because of the act 10
  11. 11. Promote Compliance & GovernanceDemonstrate to:• Employees• Customers• Regulators• Shareholders• Future Investors Accountability ProceduresThat company has: Processes Practices Policies• Duty of Care• Strong Corporate Governance Structure.• Robust framework of Internal Controls 11
  12. 12. Reduce Poor Hiring Decisions & StaffTurnover Costs 12
  13. 13. Attract & Retain Well Qualified Candidates 13
  14. 14. 3Available Types of Check 14
  15. 15. PES Checks ShouldVerify information about subject’s:• Identity & Contact Particulars• Academic Awards• Professional Qualifications• Employment History• Past/pending legal proceedings (if any); &• Potential conflicts of interest (if any).Include checks/searches of:• Prohibited persons’ lists• Other compliance databases.• Conviction Records• Credit Histories• Bankruptcy Searches• Where legally permissible• In appropriate jurisdictionsChecks can be tailored to candidate type• FTE• Intern• Long term Consultant• Long term Contractor/Vendor 15
  16. 16. Checks Available by JurisdictionCountry Education & Employment Credit Criminal COI or Financial Profession Checks Check Check Business Regulatory Checks or local best Interests Search practice SearchChina Yes Yes No Yes Yes Yes Civil litigationHong Kong Yes Yes Limited Yes Yes & bankruptcyIndia Yes Yes Limited Yes Limited YesIndonesia Yes Yes Bankruptcy No No Yes Civil litigationMalaysia Yes Yes No Yes Yes & bankruptcyPhilippines Yes Yes Credit check Yes No No Civil litigationSingapore Yes Yes Yes Yes No & bankruptcyTaiwan Yes Yes Credit check Yes No No Civil litigationThailand Yes Yes Yes No Yes & bankruptcy 16
  17. 17. 4Screening Program Considerations 17
  18. 18. Legal IssuesData Privacy Laws• Purpose & manner of collection.• Accuracy and duration of retention• Use of personal data• Security of personal data• Information to be generally available• Access to personal dataAnti-discrimination laws:• Race, gender, sexual orientation, religion, nationality, marital status, pregnancy, etc.Rehabilitation of Offenders:• If only convicted of one offence• < 3 months prison• < HK$10,000 fine• The conviction is expired• Record cannot be used to disbar employment• Subject does not need to disclose it.• Does not apply to – professions, bankers, insurers, etc. 18
  19. 19. In-house or Out-sourced?In-house• Corporate Security Department• Human Resources Department• Do they have requisite expertise & skill-set?• No. of staff required?• Sources of information availability• CostOutsourced:• Size & geographical footprint• Information sources & databases• Technology platform• Ability to conduct cross-jurisdiction checks?• Reliability – turnaround time?• Reputation• Quality control process• Fee structure• Cost effectiveness? Rule of thumb – annual program cost should equate approx. to a senior manager’s salary 19
  20. 20. Screening Program Flaws• Many organizations fail to: – Seek independent verification – Check criminal & civil litigation records – Check for bankruptcy & credit worthiness – Search prohibited persons & compliance databases – Identify reputation issues – Identify & resolve potential conflicts of interest – Index & check for persona non grata• No consistent / fair mechanism to make adverse hiring decisions• No corporate screening policy• No formalized program = high exposure to hiring risks 20
  21. 21. PES Policy ContentsPolicy Statement: Roles & Responsibilities• Conduct & Integrity • Corporate Security• Duty of Care • Human Resources• Screening Requirements • Hiring Managers• Types of Check • Compliance Officers• Levels of Check • IT Managers• Adverse Decisions • Screening Provider• Facility & IT System Access Screening Procedures• Data Privacy Statement • Candidate selection process• Employment Contracts • Communication of Job Offers• Legal & Compliance • Collection of Screening Data – Manual/Online• False or Misleading Statements • Case Initiation• Law Enforcement Referral • Case Processing• Persona Non Grata • Discrepancy ReportsPolicy Rationale & Objectives: • InvoicesScope & Limitations Adverse Decision ProcessPolicy Exceptions • Adverse decision criteria• Urgent Hiring Cases • Adjudication panels• Third Party Screening • Communicating decisions• Re-hires Management Information• Other exceptions • Reports & Performance Indicators 21
  22. 22. Discrepancy Management• Discrepancy reports & red flags need to be: – Analyzed – Clarified – Categorized – Escalated• Who conducts this process to: – Ensure consistency – Provide a check & counterbalance – Ensure policy compliance – Act as gate keeper 22
  23. 23. Adjudicating Panels• Comprises of: – Corporate Security – HR Manager – Hiring Manager• If cannot resolve, can also include:. – Compliance Officer – Country GM / Dept Head.• If still cannot resolve: – To HR Director for final decision.• Detailed decision-making guidelines devised. 23
  24. 24. Discrepancy Case Actions70% 61%60%50% 39%40% 31%30%20%10% 3% 6%0% No Issue Discrepancy Resolved Terminated TBC 24
  25. 25. 5Conclusion 25
  26. 26. ConclusionPES can be an effective risk management tool:• If the program is carefully planned• Detailed policy document formulated• Detailed procedures formulated• Properly communicated to all stakeholders• Reliable/reputable provider selected• Stakeholder expectations are managed• Centrally controlled & managed 26
  27. 27. Questions 27
  28. 28. Contact Jeremy Stone, CPP Deputy Head – Group Corporate Security American International Assurance Co., Ltd. AIA Building 1 Stubbs Road Wanchai, Hong Kong SAR T. +852 2832-8017 F: +852 2893-6890 Email: Jeremy.Stone@aia.com 28

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