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Employee Theft: How to Use Pre Employment Assessments to Determine Integrity

November 8, 2011
Estimates of the cost of employee theft range from $10 to $200 billion dollars annually.  Very little is known about the true prevalence of employee theft or exactly how costly it is for employers. What we do know is that it is expensive and a key issue for almost all organizations. I/O psychologists have been helping to identify individuals who are more likely to engage in theft and other counterproductive work behaviors for many years through the use of integrity tests.

Defining Integrity

Integrity researchers tend to disagree to some extent as to what integrity is, but they do seem to agree that it is not a unidimensional construct. Integrity seems to be a compilation of subfactors that work together to predict counterproductive or unethical work behaviors. Some researchers have found relationships between well-established personality factors and integrity tests, specifically with C (Conscientiousness), A (Agreeableness) and ES (Emotional Stability) (Marcus, Hoft & Riediger, 2006; Murphy & Lee, 1994; Ones, 1993). In an attempt to better understand the factor structure of well-known integrity tests, Wanek, Sackett and Ones (2003) conducted a judgmental sort of 798 items from seven published integrity tests and found 23 distinct composites. A principal components factor analysis of these 23 composites indicated four main components to integrity: 1) antisocial behavior (e.g., theft admissions, association with delinquents), 2) socialization (e.g., achievement orientation, locus of control), 3) positive outlook (e.g., viewing people as basically good and the world as basically safe) and 4) orderliness/diligence. Other researchers have found similar results (Van Iddekinge, Taylor & Eidson,2005).

In recent years, researchers have begun to question these factors and suggest that other constructs should be included in the definition of integrity. Connelly, Lilienfeld and Schmeelk (2006) found integrity test scores related less to moral reasoning and more towards psychopathic personality, which includes behaviors such as a self-centered nature, willingness to manipulate others, externalizing blame and an impulse to flout social norms. Lee, Ashton and colleagues have introduced the HEXACO model of integrity (Lee, Ashton & de Vries, 2005; Lee, Ashton & Shin, 2005). Their research suggests that Honesty-Humility (H-H) should be added to the definition to adequately cover all aspects of integrity. The low end of the H-H construct resembles many of the psychopathic behaviors described by Connelly et al. (2006). Future research should continue to examine the underlying make up of integrity. The more we understand what should be included in the definition, the more likely we are to be able to measure it and make sure that employees possess high levels of integrity before they are hired.

Measuring Integrity

Regardless of the factors that are being measured, a majority of integrity measurements fit cleanly into two categories: overt and covert. Overt measures of integrity ask individuals direct questions about their past unethical behavior or their attitudes towards unethical behavior. There is no subtlety or pretense to these items. Individuals find them to be very face valid and tend not to have strong negative reactions to them (Berry, Sackett & Weinman, 2007; Jones, Ash & Soto, 1990). Covert integrity items are typically personality-based and are more indirect in their connection to counterproductive behavior. Commonly used covert personality items might ask about one’s impulsivity or general outlook on people and the world. These personality constructs are supported empirically by being significantly related to counterproductive work behavior, but test takers are less likely to identify them as integrity items.

At the time of this blog, only two published studies were found that chose to look outside of these standard measurements and develop situational judgment items to measure integrity. Becker (2005) developed a situational judgment test of employee integrity. He found significant relationships with his test and managerial ratings of career potential, leadership activities and job performance. In a second study, a video situational judgment test was developed to specifically measure integrity in a sample of Dutch policemen (de Meijer, Born, van Zielst & van der Molen, 2010). A confirmatory factor analysis showed solid construct validity for the SJT measure. It is recommended that alternative methods of measurement be employed in the measurement of integrity moving forward to improve prediction and reduce issues that can exist with self-report measures.

We encourage additional research into the topic of integrity, even though researchers disagree on the make-up and measurement of this construct, research has shown that using integrity in employee selection can save companies time, money and the hassle of dealing with problem employees. The next blog will review some of the research in this area.

Amie Lawrence, Ph.D. Amie Lawrence, Ph.D. is the Manager of Product Development at PSI. She is an expert in the design, development and validation of psychological assessment tools. An integral member of PSI since 2000, Amie has led the development of numerous competency-based assessments, including online in-baskets, job simulations and motivational fit instruments.