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Hire your Way to Higher Earnings With Pre-Employment Screening Presented by: Si Lamm CPCU, Managing Director American Tescor LLC, a division of Merchants Information Solutions, Inc. Criminal Records Checks 88\% Employment Verification 86\% Drug Screening 78\%

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Hire your Way to Higher EarningsWith Pre-Employment ScreeningPresented by:Si Lamm CPCU, Managing DirectorAmerican Tescor LLC, a division of Merchants Information Solutions, Inc.
screening tools used by fortune 1000
Criminal Records Checks 88%

Employment Verification 86%

Drug Screening 78%

Education Verification 74%

Verification of Professional Licenses 59%

MVR Checks 50%

Credit History 39%

Integrity Testing 7%

Screening Tools Used by Fortune 1000


background information american tescor llc
Founded - 1979 by Dr. Peter Bullard

Headquarters – Phoenix, Arizona

Service Area – North America

Testing Volume – 40,000+ Applicants Weekly

Background InformationAmerican Tescor, LLC


tescor s electronic behavioral assessment
73 Questions about Theft, Drug Abuse, Violence & Lying.

Identifies Applicants with “Entitlement Mentality”.

5th Grade Reading Level. Takes 20 Minutes.

Tescor’s Electronic Behavioral Assessment


tescor s electronic behavioral assessment1
English plus 21 Foreign Language Versions. Audio Versions in English & Spanish.

In Compliance with all State and Federal Hiring Guidelines.

All Electronic Screening & Immediate Results 24/7/365 with/without Internet.

Tescor’s Electronic Behavioral Assessment


benefits of tescor screening
Benefits of Tescor Screening
  • The Tescor Survey has proven to be a powerful tool in improving productivity, employee morale, and earnings. This is accomplished by Reducing:
  • Turnover Sick Leave Utilization
  • Employee Theft (Shrinkage) EAP Utilization
  • Workplace Violence Workers’ Comp Losses
  • Negligent Hiring Suits STD Losses
  • Disciplinary Actions LTD Losses
  • Terminations for Cause Group Medical Costs
  • Unemployment Insurance Auto Liability
  • FMLA Utilization EPL Claims


measuring tescor s impact in reducing workers comp losses
Controlled studies cover over 428,000 workers

Time Frame – 1996 to 2009

# of Companies In Studies – 17

Average Claim Frequency Reduction – 54%

Average Claim Severity Reduction – 21%

Overall Average Loss Rate Reduction – 63%

Measuring Tescor’s Impact In Reducing Workers’ Comp Losses
tescor s effect on unemployment
Tescor’s Effect on Unemployment
  • Tescor Produced 87% Fewer Unemployment Claims & 89% Less Expensive Claims.
  • National Rental Company
  • Unemployment Claims Study Period 24 Months


short term disability std study period 12 months
Short Term Disability (STD) Study Period 12 Months

In the study, 6,800 applicants were screened with the Tescor Survey. The Unscreened group had a claim frequency rate 40% higher than the Tescor Screened group.


sample industries served by american tescor
Hospitality –Huntington Hotel Group, Hospitality Management Corp

Food Processors – National Beef

Car Rental Agencies - Hertz

Long-Term Care – Kisco, Delta Healthcare, AccentCare

Commercial Laundries – American Linen Supply (ALSCO)

Staffing – TrueBlue, Inc., Joulé Staffing Services

Transportation – KKW Trucking

Manufacturers & Assemblers – Technicolor, Thor Industries

Retail & Distribution – U-Haul, Johnstone Supply, Weis Markets

Building Maintenance and Security – Levy Security, Pacific Building Care, American Building Maintenance

Oil & Gas – Precision Drilling, Diamond Offshore

Construction-Jaynes Corp, CLP Resources, Eplica Corp Cajun Industries

Sample Industries Served By American Tescor


electronic delivery systems
Electronic Delivery Systems

Tescor on the Internet

All Tescor systems provide instant results.


theft scale
Sample Question:

Excluding minor office supplies (pads, pens, etc.), what would you guess is the value of things you have secretly taken from work in the past 2 years?

A. None

B. $5 - $25

C. $26 - $500

D. $501 or more

Serious and recent theft only.

Excludes all amounts below $5.

Theft Scale


drug and alcohol scale
Sample Question:

Excluding pills you got from a doctor (prescriptions), which of the following drugs do you use?

A. Cocaine, Coke, Snow, Crack

B. LSD, Acid, Mescaline, Peyote

C. Heroin, Opium

D. None

Only “current use” drug inquiries.

Only job-related alcohol inquiries.

Drug and Alcohol Scale


hostility violence scale
Sample Question:

Suppose you were insulted. Would you hit the person who insulted you?

A. Definitely would not

B. Probably would not

C. Probably would

D. Definitely would

Hostile individuals often interview well.

Hostility often comes out in hidden ways.

99% of all applicants pass this scale.

Hostility/Violence Scale


faking scale
Sample Question:

Since age 16, how often have you told a lie?

A. Frequently

B. Occasionally

C. Rarely

D. Never

More than 90% of all applicants pass this scale.

Faking Scale


the science behind tescor
Individuals engaging in aberrant behaviors tend to rationalize their behaviors as normal. Otherwise, they suffer from “cognitive dissonance,” an anxiety provoking state where one’s behaviors are in conflict with their values. The Science Behind Tescor


scoring the tescor survey
An individual who scores HIGH in any risk category (Theft, Drugs, Faking and/or Hostility) is considered a NONQUALIFIED applicant.Scoring the Tescor Survey


overall risk
Overall Risk


theft behaviors
Theft Behaviors


drug admissions
Drug Admissions


comparing screening tools criminal background checks
Only convictions are reported.

Limited in geographic scope – by county or state.

Not all states have statewide databases

There are 3,380 counties in U.S.

25 states have automated less than 60% of their felony convictions.

Most employee theft is never caught or reported.

Identity theft will not be caught.

Capture Rate: 6% Cost: $25 to $150.

Comparing Screening Tools Criminal Background Checks


comparing screening tools urinalysis limitations
Most drugs (except marijuana) clear a user’s system in less than 72 hours.

Web sites like “” sell clean powdered urine with 200% guarantee.

Subject to legal challenges through faulty lab work, sample mix-ups, or chain of custody.

Capture Rate: 5% Cost: $10 to $50

Comparing Screening ToolsUrinalysis Limitations


false negative study midwest based staffing company
Study Background

This Midwest based staffing company primarily serves the light industrial sector. They conducted urinalysis screening on all applicants who passed the Tescor Survey. All those who passed the urinalysis were then subject to criminal background checks.

False Negative StudyMidwest Based Staffing Company


false negative study midwest based staffing company1
Study Period: 24 months

25,003 Workers Screened by Tescor

19,901 Workers Passed Tescor

80% Tescor Passing Rate

Prior to implementing Tescor 5% Failed Urinalysis and

5% Failed for Adverse Background Check

After Implementing Tescor:

142 (.7%) Passed Tescor and Failed Urinalysis

59 (.3%) Passed Tescor and Failed Background Check

201 (1%) Total Tescor False Negatives

False Negative StudyMidwest Based Staffing Company


the cost of high risk employees
Thirty-eight percent to 50% of all workers’ compensation claims are related to the abuse of alcohol or drugs in the workplace.

-U.S. Department of Labor

Drug-using employees are five times more likely to file a workers’ compensation claim.

-National Institute on Drug Abuse

Drug and alcohol abuse in the workplace cause 65% of on-the-job accidents.

-Department of Labor

The Cost of High Risk Employees


the cost of high risk employees cont
Studies show that alcohol and other drug users use three times as many sick days.

-National Council on Alcoholism & Drug Dependence

Drug users are absent from work an average of five days per month due to drug use.

-U.S. Department of Labor

Substance abusers are 10 times more likely to steal from the company or from other employees.

-U.S. Department of Labor

The Cost of High Risk Employees Cont.


the cost of high risk employees cont1
The U.S. Department of Commerce reported that the annual losses generated by poor hires, absenteeism, drug abuse and theft amount to $75 billion per year; and 30% of business failures are due to poor hiring practices.The Cost of High Risk Employees Cont.


legal compliance
Legal Compliance
  • Tescor has been “litigation free” throughout 30+ year history.
  • Screening tools must be either validated or non-discriminatory – Tescor is both.
  • Federal and State guidelines require protected classes to pass at a rate that is 80% or better, compared to the relevant class.


passing rates of protected classes
Passing Rates of Protected Classes

By Race, Sex and Age


80% Rule



80% Rule


Under 40

80% Rule

Over 40

Passing Rate (percent)


Tescor’s Effects on

Workers’ Compensation

common denominators in expensive comp claims
Common Denominators In Expensive Comp Claims
  • History of Absenteeism
  • History of Disciplinary Action
  • History of Prior Claims
  • History of Drug Abuse


cornell university findings
Screened employees are less likely to file a claim.

The screened employees’ average claim was smaller than the average claim filed by an unscreened employee.

The screened employees’ claim variance was smaller than the unscreened employees’ claim variance.

The average claim cost of all screened employees is less than average claim cost of all unscreened employees.

The screened employees are less likely to file large claims (i.e., > $2000) than unscreened employees.

Cornell University Findings


the essence of business
“The first duty of business is to survive and the guiding principle of business economics is not the maximization of profit – it is the avoidance of loss.”

-Peter Drucker

The Essence of Business


hiring the right people
"In looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And if they don't have the first, the other two will kill you.” - Warren BuffetHiring the Right People


tescor screening improves earnings safety productivity
Tescor Electronic Screening:

Highly Effective

Easy to Administer

Generates Very High ROIs

Tescor Screening Improves Earnings, Safety & Productivity


Tescor’s integrity test is a highly effective tool in reducing the costs associated with employees’ high risk behaviors. After using the Tescor Survey for a two year period, we conducted a comp benchmarking study for our California operations. Our projected saving was more than $10,000,000 in direct cost alone and greater than a 20 to 1 ROI.Using Tescor’s screening on new job applicants allows us to hire a higher quality employee which also means less turnover, employee theft, and hostile incidents in the workplace.Chris BurgerDirector of OperationsPacesetter Personnel Services


workers compensation
Workers’ Compensation

The Tescor Group’s frequency was 47% lower.

The Tescor Group’s severity was 9% lower.

The combined savings was 52% on an Incurred basis.


the cost of loss
On average INDIRECT costs outweigh the DIRECT costs

by a 4:1 ratio.

Direct Costs (Hard Costs)

Medical Treatment


Legal Cost

Indirect Cost (Soft Costs from Cash)

Time for Completing Reports  Investigation Time

Loss of Productivity  Increased Work for Others

Missed Schedules  Loss of Worker

Seeking Medical Treatment  Cost of Replacement

Paid Time for Treatment

The Cost of Loss


workers compensation1
Workers’ Compensation
  • Closed Claim Study
    • Study Period 48 Months


"The Tescor Experience"

The Jaynes Companies

  • Regional General Building Contractors
  • Five Companies – Six Area Offices
  • New Mexico
  • Colorado
  • Nevada
  • California
  • Texas, Arizona & Utah
  • Union & Non-Union Employees
  • Average 450 employees 2006 - 2010
  • Implemented Tescor January 2006
"The Tescor Experience"

Affected Applicants

Tescor currently administered to all new hire positions in all companies & locations

Tescor currently administered to rehired employees

Stage of Hiring Process

  • Tescor administered immediately after application completed
"The Tescor Experience"

Non-Qualified Results

  • 2006 @ 24.94% Non-Qualified Results
  • 2007 @ 23.12% Non-Qualified Results
  • 2008 @ 17.00% Non-Qualified Results
  • 2009 @ 18.75% Non-Qualified Results
  • 2010 @ 18.29% Non-Qualified Results
"The Tescor Experience"

Failure Category Results

2006 - 2010

  • Theft Scale @ 11%
  • Drugs Scale @ 8%
  • Faking Scale @ 5%
  • Hostility Scale @ 0%
"The Tescor Experience"

OSHA Recordable Incident Rates

Days Away, Restricted, Transfer (DART)

  • 2006 @ 5.58
  • 2007 @ 3.89
  • 2008 @ 4.43
  • 2009 @ 1.87
  • 2010 @ 1.46
"The Tescor Experience"

OSHA Recordable Incident Rates

Total OSHA Recordables

  • 2006 @ 7.85
  • 2007 @ 5.33
  • 2008 @ 6.36
  • 2009 @ 3.12
  • 2010 @ 2.62
"The Tescor Experience"

Workers’ Comp Costs

  • 2006 @ $0.37 / Man-hour
  • 2007 @ $0.05 / Man-hour
  • 2008 @ $0.26 / Man-hour
  • 2009 @ $0.15 / Man-hour
  • 2010 @ $0.13 / Man-hour
"The Tescor Experience"

Attorney Representation

2006 - 2010

  • Non-Tescored Injured Employees
  • 4 out of 90 = 4.44%
  • Tescored Injured Employees
  • 1 out of 94 = 1.06%
questions answers

Questions & Answers

Si Lamm, CPCU, Managing Director

Phone: 503.697.6551

[email protected]

American Tescor LLC, a division of Merchants Information Solutions, Inc.