Nov 18, 2013

Does this sound like something that would never happen in your business?

You might be right, but there is only one way to make sure. This is what happened to a small business I know…

Like many small businesses today, they were having a hard time finding good candidates. They posted their open sales job on Monster, Careerbuilder,, and Craigslist.

Piles of resumes came in but none of them seemed right. Most had no sales experience and this small business did not have the resources to train a new employee on their industry and in sales. The perfect candidate would be someone with a few years of sales experience from within their industry.

Almost too good to be true

After months of searching, they finally got a resume that looked PERFECT!

The candidate was an industry veteran. He had 10 years of experience selling for a local competitor that was being purchased. He could walk in and start producing on Day One, and would require virtually no training.

The icing on the cake —  the candidate asked for a slightly higher commission rate but no base salary. He wanted join as a contractor, rather than a W-2 employee. He had health insurance though his spouse and preferred to be paid as a contractor.

This seemed almost too good to be true: an industry veteran, with a proven track record, with no risk of investing a base salary.

Realizing you made a big mistake

After a couple of face-to-face interviews an Independent Contractor Agreement was sent and a start date was confirmed. Since the new employee was a contractor, and the company was so excited to land such a producer, time was not taken to perform a background check or check references. After all, if the new employee didn’t produce new business they wouldn’t need to pay him anything.

Thankfully the owner of this small business started thinking a little more about the situation. You know how the saying goes — “If something seems too good to be true…” On a whim, the owner decided to do a little research on their new employee the Friday prior to his start date.

It didn’t take long. The owner simply “Googled” the employees name, and quickly realized they made a big mistake. It turns out their new savior was a convicted felon! He had been convicted for stealing money from the retirement accounts of his clients.

The owner let the new employee know about what he found, and needless to say, he never actually worked for the company. He dodged a bullet, but if he didn’t do the research who knows how the story could have unfolded.

Two valuable lessons

This story could have ended a lot worse, and the small business owner learned a couple of valuable lessons.

  1. No matter how perfect a candidate appears to be, and how much you need them, it is critically important to go through your normal interview and hiring procedures. Never rush someone through the process.
  2. You should always perform background checks and reference checks for ALL employees, no matter how you find them (even friends and family). There are numerous, inexpensive options available for background checks today, and reference checks involve nothing more than a few phone calls.

Performing background checks and reference checks on all new hires could save you from and experience like this, or worse!

This was originally published on the Genesis HR Solutions blog.