On this episode Josh spends time with Jaren Rosenthal, Founder & CEO at Health Street & StaffGlass. They talk about drug testing and background checks when hiring new employees.
Jared Rosenthal is a CEO turned entrepreneur, reality TV show host, and tech innovator.
Recently, he has pivoted to technology and launched StaffGlass, hiring and recruiting software as a service that allows businesses to easily set up a new kind of workplace screening solution that integrates most if not all of your onboarding screens, tests, and checks in one!
In today's episode you will learn about:
Why is it a challenge to recruit new job candidates?
Why are current onboarding systems not as efficient?
How has the pandemic changed the way onboarding is run?
What are some tips for streamlining your onboarding and recruiting?
Narrator: Welcome to Cracking the Cash Flow Code where you'll learn what it takes to create enough cash to fill the four buckets of profit. You'll learn what it takes to have enough cash for a great lifestyle, have enough cash for when emergency strikes, fully fund a growth program, and fund your retirement program. When you do this, you will have a sale‑ready company that will allow you to keep or sell your business. This allows you to do what you want with your business, when you want, in the way you want.
In Cracking the Cash Flow Code, we focus on the four areas of business that let you take your successful business and make it economically and personally sustainable. Your host, Josh Patrick, is going to help us through finding great thought leaders as well as providing insights he's learned through his 40 years of owning, running, planning, and thinking about what it takes to make a successful business sustainable and allow you to be free of cash flow worries.
Josh Patrick: Hey, how are you today? This is Josh Patrick and you're at Cracking the Cash Flow Code. My guest today is Jared Rosenthal from staffglass.io. Jared has started a bunch of businesses. I guess, he was a reality TV star for a while. We might have to check that out, but I don't know if we'll have time to get there today. He really wants to help entrepreneurs be successful and I don't really like the term, so let's just say private business owners. How's that for the day? Since this is my tradition of doing short and not very good introductions, let's bring Jared on and we'll start the conversation.
Hey, Jared, how are you today?
Jared: Hey, thanks for having me.
Josh: My pleasure.
Let's talk about something that your company does. It's not anything that we've talked about here in Cracking the Cash Flow Code yet which is background checks, drug testing, all the sort of stuff that we probably should be doing in our blue‑collar businesses and we never get around to it.
Jared, why is that sort of stuff important to do?
Jared: Well, you know what, it's always been important. I think, now, it’s even more important. And, you know, one of the things that I think a lot about, especially lately, is small businesses versus big businesses. And big businesses sort of gobbling everything up over the last year. Small businesses going out of business at an incredible rate - on how can we help smaller folks compete with the bigger guys?
And one of the things, you know, if you look at the bigger business, one of the things that they do, just much better, in general, are things involving technology. And with technology, it's everything from the hiring-- you know, it begins at the recruiting, and the hiring, and it goes all the way through to everything they do.
I think some of our small businesses are getting good at technology with their product offerings, you know, their core business, but it's that technology throughout the enterprise, whether you're a one‑man or a one‑woman shop, or 20‑, or 30‑, or 50‑people - that technology that helps run the business, maybe some of the things you don't like doing as much as your core business, is critical to being able to compete. What we've done with background check and drug testing is sort of made these stuff available to small and medium businesses with a better technology platform that they can access really easily and get these critical functions done same way that a bigger company would without having to spend all the money and the time learning that stuff.
That's your main point. The “Why is background check important?” I mean, there's so many reasons but from just a protect‑your‑company, protect‑yourself standpoint, if anything goes wrong with a hire, companies can get sued. It happens all the time. And a big way to protect yourself is to make sure that you've run the proper background check and administered proper drug tests prior to hiring.
Josh: So, what if somebody you really, really, really, really want to hire comes up positive for smoking marijuana? What would you advise a business owner?
Jared: Marijuana. This question comes up quite a bit.
Josh: I'm sure it does.
Jared: So, that is the trickiest one of all because, just to boil it down to the very simple explanation, at the federal level, it is a Schedule I classified substance, completely illegal, recognized to have no medicinal purpose whatsoever. For reference, crystal meth is a Schedule II, okay? So, it's as illegal as it can be at the federal level.
But then states, in so many different ways, we have people hiring in one state where it's completely illegal, but they hired someone from a state where it's legal, recreationally, or someone has a prescription. My advice to business owners, if you're not hiring a federally‑regulated job, such as a truck driver, okay, that's completely under the federal regs and you don't have any discretion whatsoever. But if you're hiring anybody else, it's up to your discretion. So, if you're hiring somebody that maybe is in a childcare setting, maybe it's important to you. If they're stocking shelves, maybe it's important to you, maybe it's not.
So, even with background check and drug test, the same advice applies. Do the testing that's relevant for the job. There's no one drug test. There's no one background check. So, you can do a comprehensive criminal, sex offender, terrorist registry, check 50 states if you are hiring somebody in a highly sensitive position, or you might say, “Well, I only want to focus on the things that are actually relevant to this job.” So, the same thing applies with marijuana. If it's relevant to the job, by all means, you certainly have the right to test for it, even in your states that are recreational because of the federal rule.
Josh: Well, there's something I think that folks also want to make sure that they're aware of. If you're hiring a truck driver and they don't need a CDL, which is a commercial driver's license, they're not under federal registry at that point.
Josh: It's only if they're CDL drivers, which are the big trucks on the road, the big box trucks and, certainly, tractor trailers. But if you're driving around a panel truck or a small van, that's not under federal regulations, so.
Jared: Correct. 26,000 pounds is the generally accepted cut off.
Josh: So, if you're running a construction company and you've got a guy banging nails, who passed the drug test or didn't pass the drug test, well, it's up to you at that point, but there's nothing that keeps you from doing it.
And I should mention that, you know, we have every panel available without marijuana. So, you know, if you're hiring somebody that's on a ladder, you know, maybe you don't care about marijuana, but you certainly care about harder drugs like cocaine and meth and, you know, all kinds of other things that are out there. And, obviously, opiates is a tragic pandemic of opiates. You know, I think, 80,000 people overdosed last year and died. There's so many other drugs. So, you can do a drug test and you can care about it but exclude marijuana if that's, you know, your personal preference.
Josh: Yeah. So, a lot of times we've talked here about how to hire effectively which is the hiring process itself, or the interviewing process itself, to make sure we have the right person for the right thing. Let's talk about all the other stuff you might be doing like, you know, background checks is certainly one thing you want to do. If you're in a cash business and you're not doing a background check, I call you an idiot.
Jared: Yes. You know, you'd be surprised though because it happens all the time. I had a--
Josh: I wouldn't be surprised at all.
Josh: I used to own a vending company, so I know all about that.
Jared: Right, right.
Well, we had a guy-- well, you know, obviously, I can't mention any names, but somebody was hiring a pilot for a small helicopter or a small plane company coming and I said, “You know, you’ve got to do the terrorist registry.” And he said, “Nah, I don't want to do it.” I said, “But, he’s a pilot, right? I mean, come on.” You know, I mean, there's certain things that are just obvious that you have to do because, again, if something goes wrong, what's going to happen? They're not just suing the guy or the woman that committed the act, they're coming after the company and you don't want to be put in that position.
There's even something called negligent hiring lawsuits now, where you can get sued for not doing a background check, you know, because if something goes wrong, they can say, “Well, it’s so easy to do a background check. You should’ve done it. And you should have known that this guy, XYZ. And, therefore, you know, you were negligent because you didn't employ basic hiring practices.” You’ve got to protect yourself.
Josh: Yeah. The thing I've seen, which I find pretty amazing, is people go around and they say, you know, the reason they don't do background checks and the reason they don't do drug tests, they don't want to know. And the reason they don't want to know, let's talk about this for a second is, it's really challenging to get someone to even give you an application, much less come to work for you. So, once you get a hot application and the applicant looks good, and they interview well, and they hit the buttons that you want in the interview, you don't want to find anything as bad about him. So, if you don't do this stuff, you don't have to look at it.
Jared: Right. That's a bad idea. It's a bad idea [inaudible 00:08:51].
Josh: It’s a bad idea and people do it all the time.
Jared: They do it all the time.
Josh: Besides being sued which-- yeah, it happens, but it happens a lot less than a lot of folks actually say. I mean, I know very few people who've ever been sued for hiring practices.
Josh: I know it happens. And it typically would happen in a bigger company who has deeper pockets than a small business with 10 folks running around, but you still need to pay attention to it.
Jared: Well, look, the people that you hire is your business. What is really the business? It's-- you look around, you see the people that are working for you and working in the company. That's what your business is. So, there's nothing that represents you more. All of your ideas, all of your policies, it comes down to the people more than anything. And if you're new at it, the DNA of the business gets set very early on. So, you know, who you hire is just absolutely critical.
Now, I agree. It's frustrating that the testing happens at the end because it feels like you've already made a commitment to that person. And, you know, based on certain state regulations, it's advisable to make the testing post offer and then they get hired contingent upon passing those tests. And because of that, now, you're already committing like, “Ah, man, imagine if he fails,” you know. So, the best thing to do is to just make it very clear before you even speak to anybody that, “We're going to do these drug tests and these background checks.” Put it out there. And then, yes, you will get certain people self‑selecting out of even contacting you to apply for that job.
Josh: Yeah. So, when you're doing-- whether you do an online job application or a paper application, make sure that you have a statement that you're going to be doing a drug test, a statement that you're going to be doing a background test, and, if possible, to give a short description of what it is and get a checkbox and an initial that they've read this and understand it's going to happen because, if you do it and you don't tell people you're doing it, that also makes you liable.
Jared: Yes. Although, in practice, that that would be also very rare for somebody to come after you.
Josh: It's going to be really rare, if it does.
Jared: Really rare, but I think your recommendation that you’re just putting it out there, they have to physically check it, is very psychological. And, you know, if somebody says, “Well, I smoked coke or crack last night, and I'm checking this box,” unless they're still high, they're probably not going to proceed filling out the application.
Josh: Right. But you may also get somebody to say, “Gee, you know, I smoked pot last night, is this going to keep me out of there?”
Josh: And what it does is it kind of promotes a little transparency between your job applicants and you or it appears to me that it does.
Jared: Yeah. The more you can state upfront about what you're going to do, the better. Transparency is critical. And it's critical for the-- not just the catching, you know, the so‑called “we caught you,” but for the-- let's look at the people that you're actually going to have that are going to be great long‑term representatives of your organization. You know, setting the tone, even before you meet them, is critical because they see right away, “What is this company about? What are their values?” Right away, I see. “Okay, we’re stating we're, you know, an equal opportunity employer. We're stating we're going to test for drugs. We're going to exclude marijuana.” Okay. You're stating some things about your organization that they're seeing that partially self‑selecting into but also learning what behavior is acceptable. And, again, setting that mindset for the long term.
You know, first impressions go a long way. And, as business owners, we often sort of discount people that don't work here yet. You know, “Oh, they need a job. They'll do anything.” But think about the ones you're actually going to hire that, you know, you want to make a good impression on and forget about all the ones that you're going to weed out.
Josh: If I'm doing all this stuff, I am lowering my pool of people who could come to work for me. And that's just a fact. We just are.
What kind of tips do you have to increase the amount of applicants you get coming in the funnel or in your door? So, even though you know you're going to toss out 20%, 30%, 40% of the people, especially from blue‑collar jobs like carpenters, or electricians, plumbers, waiters in a restaurant, all that sort of stuff, how would you increase the amount of applicants that you're actually getting?
Jared: Well, I think, you know, background check is a very serious social issue as well--
Jared: --okay? Because we know that the criminal justice system has not been equal in its treatment of everybody in this country. So, it is very important to only test for and check for and hold people accountable for what's most important. So, how do you do that? Well, you could go back as far as you want, in most states, and you could say, “Well, you did something 20 years ago and, therefore, you're not qualified for this job.” Or you could look at things like how have they repaired themselves? How have they paid their debt to society? How have they been clean for X number of years since then? And then you pair that with what kind of job you're hiring for.
If somebody is a carpenter, is a good example. Let's say, they're only on building sites and they're never going into somebody's homes. Okay, so maybe you have a different acceptable standard for what you're looking at in terms of background check. If you're sending people to do carpentry in a nursery school maybe it's a different standard that you're going to hold for that background check. And that's how you can sort of state your values and also encourage more people to apply. They may have said, “Ah, these guys do background checks. I'm never going to make it because I had a, you know, problem five years ago.” You can help address and start to do your part in correcting some of the long‑standing social problems that the criminal justice system has exacerbated.
Josh: So you said a word a couple of times now which I want to spend a minute or two talking about because it's near and dear to my heart which is values. I have found, and I'm curious about what you have found, as you've coached your customers through the process, that, if I write a job description or I write a job ad and I focus on the values of the company more than the specifics of the job-- I mean, you have to have some specifics, obviously, I'm going to get a better applicant. I'm going to get applicants that actually agree with what we're about. And I'll probably even get in more applicants because I'm being specific and people can self‑select. Does that make sense to you?
Jared: I think it does. I think it makes a lot of sense, you know. I mean, I think the one hesitation, I'm from New York, so we're always worried about people trying to play us. So, the one hesitation as we say, “Hey, we want this type of values” that you're going to expect that people will then turn around and say, “Well, those are exactly my values,” right? Because people oftentimes will say anything, I mean. But the truth is, you know, you'll be able to see through those things. And the better outcome will be that you will start to get people that will say, “Hey, I'm really impressed with what you're all about,” because companies are a reflection of the leader’s values.
And if there's one lesson that I've learned in business, over the decades, that's probably the most important thing. Companies reflect their leaders and the leader’s values. If the leader is cutting corners, you can sure bet that the people down the ranks are going to be doing the same thing, you know, especially when--
Josh: Or worse.
Jared: Or worse because you've set the standard, you know. And it seems simple, it seems silly, but you look at any organization, and you can check the leader and the leader’s values, and you can be pretty sure there's a close match.
Josh: Well, if the leader’s not exhibiting their values. Let's say the leader says, “One of our values is honesty,” and you're out there cutting corners, your people will see it and they're not going to believe your values.
Josh: So, now, your values are not only not good for you, they're actually a negative because you're lying. And your people will see that you're lying, and they may not say that to your face, but they're saying it to each other.
And my personal style-- you know, everybody has their own style, but my personal style is to side on exhibiting values as opposed to stating them. You know, I've been in companies where people say, “Oh, this company is about family. We're all family.” But it's really easy for somebody to get mad about something and say, “Oh, that's the way you treat your family?” you know? And then, they use it against-- it becomes a negative. So, I'm a big believer in exhibit the values that you want the people-- you know.
And they'll see. People watch their bosses. They see how you behave. They see when you, you know, you say, ah, just say this, you know, “Oh, the customer wants it.” “Ah, just say that.” Well, guess what, what did they hear? They heard, “Oh, I could lie to the customer.” If I never do that, I didn't have to get up and say, “Truth is the most important thing. Honesty is the most important thing.” They're going to see that.
And then, there's always a time when someone says, “Well, can I just do this?” And you say, “You know what, no, you can't do that. It's not the right thing to do.” And they see that, too.
And one thing, last thing I'm going to say about this is, truth is sort of like a non‑negotiable one in business. I mean, business begins with truth. There's no business, there's no relationships within a business, even amongst you and your employees if there is no truth to it. That goes beyond. You shouldn't have to state that. That should just be-- if you're not doing that, you're going to have parts of your business that will collapse on itself.
Josh: Well, I will tell you, from personal experience, you need to do both. You need to state your values with a clarifying statement, so people know what you're talking about. And then, you need to exhibit those values because if you don't exhibit those values, the values you're stating are completely useless.
Now, it's okay to state a value with a clarifying statement and say, “This is aspirational. We're not 100% here yet but we're working like crazy to get here. Here's what we're doing.”
Josh: That way you're not going to be seen as a liar.
And I always tell a story of myself is that one of my core values is personal responsibility. And when I was 28 or 29 years old, I did not exhibit that. And when I first said, “We're personally responsible,” my employees saw me as a liar because I didn't say it’s aspirational. I said, it’s core. I learned a pretty painful lesson along the way there where people, behind my back, would do really crappy things because they felt I was lying to them and they saw no reason to take that value and live it themselves.
So, we have time for one more question. I'm just curious about this. Why are current onboarding systems not very good?
Jared: Because they barely exist, because, you know, most of the companies - small and medium companies we deal with, when you ask them what's their onboarding system, they take out the, you know, the one - they have this one for drug test, this one for interviewing, this one for recruiting, this one for hiring, this one for payroll, and it goes on and on. That's not an onboarding system. That's a mess and a problem, errors waiting to happen. Just re‑entering the same thing to 10 different systems is a problem, it’s causing administrative burden on business owners and managers.
An integrated onboarding system is so important because there's one source of truth as to who this person is. We start with a scan of a driver's license. So, if you're hiring even remotely, they just take their phone and scan their license. And all their, you know, the record begins with that and that flows through to all the aspects of the onboarding process so you can know who's signing - who's e‑signing your waiver that allows you to run the background check, who's showing up to the drug test. What is their spelling name and the picture on their ID so you can confirm this is the right person. So having an integrated system, first of all, saves a ton of time and it reduces an incredible amount of errors, you know. And it helps small businesses really compete on a level.
That's what the big guys are doing. They have very complicated, larger HR systems, but just for the purpose of consolidating seven to 10 different hiring practices into one system is a huge benefit for businesses.
Josh: So how much would it cost for a business to do something like that?
Jared: I mean, right now, we don't even charge for the use of that integrated package. The services that you order are where we charge. So, like, if you order a test. If they order a drug test, there's a fee for that. If they order a background check, there's a fee for that. So, we’ve integrated all into a great platform. And our feeling, as a business is, “Hey, once you get in there, you're going to want to stay there because it's just so much easier and better and you'll continue to use our services. And if you don't, then we didn't do enough, a good enough job.”
So, Jared, for those who are not watching on Facebook or YouTube, how do they find you?
Jared: Well, the software is at staffglass.io. That’s staff like labor and glass like a window .io. And then, the testing services are at health-street.net. That's our legacy platform where people are just ordering the drug testing and background check and they can still do that, health‑street.net. And then, the integrated software is at staffglass.io.
Josh: And I have two things I’d like to ask you to do. And the first one is something I ask all the time which is please, please, please, please go to wherever you're listening to this podcast and give us an honest-- I mean, an honest rating and review, which means, if you love us, you tell us you love us. And if you hate us, I hope without you saying that. But, if you do hate us, you can say that, too.
And the second thing is I started this as a joke. And it's kind of been a fun little thing I've played around with for years and years, about 20 of ‘em. About 20 years ago, I was hanging out with a friend of mine. And he showed me this little one‑page thing he had which he called the periodic table of estate planning elements. I said, “Hmm, that's a cool idea. I think I'm going to steal it.” So, I put that together and what I did, I made a periodic table of business planning elements. And what it is is a whole bunch of tactics and strategies that you can use to help make your business personally and economically sustainable. Really easy to get, you just go to www.stage2planning.com/periodic. That’s www.stage2planning.com/periodic.
And this is Josh Patrick. We're with Jared Rosenthal. You're at Cracking the Cash Flow Code. Thanks a lot for stopping by. I hope to see you back here really soon.
Narrator: You've been listening to Cracking the Cash Flow Code where we ask the question, “What would it take for your business to still be around a hundred years from now?”
If you've liked what you've heard and want more information, please contact Josh Patrick at 802-846-1264 extension 102, or visit us on our website at www.sustainablebusiness.co, or you can send Josh an email at email@example.com.
Thanks for listening and we hope to see you at Cracking the Cash Flow Code in the near future.