When you go into business with someone new – whether hiring them as an employee or teaming up with a co-founder – you’ll want to be completely confident in your relationship with them. While a thorough, and competency-based selection process is your best strategy for making a good hiring decision, there are still some checks you will want to make.
Once you think you’ve found the ideal person to join your business, it’s vital that you only make a conditional offer to them (verbally and/or in writing) until you have done some necessary research (known as due diligence).
If you don’t and you then find out that they aren’t as suitable for the role as you thought, you may get tripped up when trying to withdraw the offer.
When it comes to seeking references, it is advisable to make them “subject to references that are satisfactory to us”, rather than just “satisfactory” to avoid any subjective arguments with the individual.
Here’s what you need to know...
What you can check:
1. Right to work in the UK
If you’re about to hire an employee, it’s a legal requirement that you check they’re allowed to work in the UK before they begin employment with you. If you don’t, you could be fined up to £20,000 for each illegal worker (or be sent to jail for five years and pay an unlimited fine if you’re found guilty of employing someone who you knew or had ‘reasonable cause to believe’ didn’t have the right to work in the UK.
To get the most up-to-date advice on this, take a look at this employer’s guide to right-to-work checks from the government.
If you’re using a good recruitment agency, they will often have run these checks already, but do ensure you get evidence that they have done so.
Once you’ve received these confirmations, cross-check what you’ve received against the government’s tool to ensure that your process is sufficiently robust to protect you and to prevent the risk of any legal penalties.
Helpfully, the government intends that this tool and its related materials will remain updated and relevant as the UK’s position within the EU transitions. So, if you’re looking for up-to-date information about the impact of Brexit on European job candidates within the UK, or UK workers within the EU, the link to the assessment tool is a great place to start.
2. Criminal record checks
Unless they’re going to be working in healthcare or with children or vulnerable adults, for example, you aren’t able to check criminal records and conditional cautions yourself. However, if you’re concerned, you’re allowed to ask the candidate to get checked themselves and to share the results with you. Do bear in mind though, that even if they have expired convictions, you aren’t allowed to base your hiring decision on that (unless they are working in healthcare, with children, etc.) Here’s where you can check.
3. Health checks
The Equality Act 2010 prevents employers from carrying out pre-employment medical screening. There are some exceptions to the rule, and you’ll find up-to-date guidance on this here.
Due diligence with references
A reference can really give you an added boost of confidence when making that important decision of who to bring into your business – but remember, it’s important to use references to only confirm your decisions, not to make them.
All job offers should be conditional upon references being obtained, that are “satisfactory to us”, so if you find the references are unsatisfactory, you can lawfully withdraw the offer without being in breach of contract.
If you can’t get a detailed reference (it’s becoming common for companies to refuse giving these), you could instead ask for a two-line reference that simply confirms the dates of employment.
And remember if seeking a verbal reference: Don't let the conversation steer onto anything about the candidate’s personal information (such as age, disabilities, or marital status). Everything that both you and the referee speak about should have a direct relevance to the job.
If you hear something that concerns you, be tactful, but don’t be afraid to follow this up with the candidate. If you’re worried about how to do this without difficult repercussions, you can always speak to one of our experts.
A quick note about due diligence through social media
While typing a candidate or potential co-founder’s name into social media to find out more about them is super simple to do…it’s really not the best way to go about doing due diligence. In fact, without meaning to, you could open yourself up to claims of discrimination, liability, and being accused of not complying with hiring regulations.
Information about applicants – for example, their age, their marital status, or disabilities – are likely to be irrelevant to most jobs. They will often be evident in social media feeds. If you take them into account as part of your decision making, you’re probably crossing the line of what’s lawful.
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