When preparing to hire a new employee, how important is it to check references and information you gain from applications and interviews? My advice is this: Check every shred of information to learn everything possible about a potential employee before you decide to hire.

The employees you hire play an important role in the future success of your business. And remember, these people may have access to your money as well as your other assets.

The following true story shows how one business owner learned the hard way about the need to check references.

Learning the Hard Way

John spread the word among his employees, suppliers and even his customers that he desperately needed to hire an experienced salesman. To his delight, an ideal applicant walked in seeking the open position. After a brief discussion, John felt he had a winner. He asked the applicant to fill out an application, but held off making an offer until he had interviewed all applicants. He didn't bother to review the man's application.

Two days later, John hired back a former employee, but promised the walk-in candidate he would keep him in mind and keep his application on file. He was delighted the young man didn't appear hurt by his rejection, and he felt even better when the applicant became a customer, buying $220 worth of merchandise. Then came the fatal blow. "May I write you a check?" the applicant asked.

"Sure," said John. He had no fear accepting the nice, young applicant's check. Besides, he had his application on file with 10 times more information than he normally requested from an unknown customer paying by check.

Guess what? The check bounced, but the real shock came when John tried to go after this con artist by using the information on the application. Not only was everything on the application totally false, but the people listed as references and past employers were also looking for him for writing them cold paper!

Remember that people applying for jobs want you to only see their good side, and they will sometimes avoid, obscure or even lie about information you need to know.

Here is a partial list of important checks to make on potential employees:

• Check every personal reference. While these are traditionally friends, you might require prospective employees to submit references from people they have worked with, or ask for a large number of references. The more you check, the better picture of this individual you develop.

• Check every previous employer. In addition to your standard questions, ask about this person's attitude, dependability, follow-through, willingness to assume responsibility, etc. These are vital elements of character and only previous employers really know the answers.

• Check the credit bureau if the position you are hiring for will involve handling money. Money problems, past and present, paint a picture indicating financial stability or lack of it. My key rule is, "If you can't manage your own money, can you manage mine? I doubt it!"

  If you are not a credit bureau member, perhaps you have a business friend who could help you obtain a credit report. Banks, realtors and businesses with big credit departments always belong to credit bureaus.

  If you have no access to a credit bureau report, check the court records at the local courthouse for financial judgments, past or present. They keep records for seven years.

• Check driving records. If the potential employee will have occasion to drive a company vehicle, you must know their driving record. Often you can simply ask the applicant to supply you with their current printout, or perhaps your insurance company can help you obtain access to this information.

• Lose the employee's application. If you have any doubt about a desirable employee's honesty or you question the information on an application, remember this invaluable idea:

  Call the person in and request that they complete a second application. You can state that you have "misplaced" the original.

  Now, armed with two applications, double-check all information. Are dates of previous work history the same? Does any information not cross-check? If there are any major differences between the two applications, throw the red flag in the air and proceed with caution!

While I suggest you assume the role of private detective in gleaning information, how you react to such details is very important! Be extremely careful with what you say and even more careful with what you write (such as why you reject a job applicant). There is a rat's nest of local, state and federal laws governing employment. Review the laws thoroughly, or find and work closely with a good attorney.

Remember that time spent gathering data on potential employees is time well invested in the most important task you do ... bringing good people aboard.

Jerry Wilson, CSP, is an internationally known certified professional speaker and marketing strategist. He is an authority on creating repeat business, getting referrals and building long-term customer relationships. You may contact him for your next convention, conference or meeting or to consult with you on marketing and customer strategy. He may be reached by phone at (800) 428-5666 or (317) 773-7851. His fax number is (317) 773-7851 and his mailing address is P.O. Box 1333, Noblesville, IN 46061. His e-mail address is Jerry@JerryWilson.com.

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