Do a proper background check. Actually call previous employers and get honest reviews. Thorough drug testing, etc.
Practically everything. There are far too many negatives to list here. Favoritism needs to leave; absolutely no place for it when people do the wrong thing and still manage to keep their job.
Normal, non-contractual positions aren't paid well enough. Get more money with no benefits, but it's a ridiculous policy. No holiday pay; only in this state have I ever worked for companies that do this.