Short answer – it was less "hiring" and more "drafting". No pre-screening happened that I could find evidence of (well, except for the general "has to be a good Nazi" principle, which might count towards that), but being soft on incarcerated was strongly discouraged, which led to a predictable result of "refining" the most harsh guard possible.
The camps were primarily guarded by the SS-Totenkopfverbände – a special division of the SS. One didn't join the camp guards – one joined the SS. At that point, it didn't really matter what one wanted – members of the SS were expected to follow orders as much as soldiers were. If you were assigned to SS-Totenkopfverbände, you went to guard the camp.
While technically there were no "screening for sadism", SS were comprised of people who either truly accepted Nazi ideology or successfully faked it. Thus, they indeed were "pre-screened" for being 1) obedient (because of patriotism), 2) dismissive towards certain groups of people. As concentration camps held people who a Nazi would consider subhuman, the treatment of inmates would be... not good. In fact, Theodor Eicke, commandant of Dachau (the first concentration camp and the model for subsequent camps), encouraged his people to treat inmates with "inflexible harshness": they were the enemies of the state, after all! And that attitude was replicated in other camps – the Dachau camp was a training facility for the SS guards. As such, anyone who completed that training would appropriate the behavior of his SS teachers.
In the last days of WW2, SS formed so-called "SS-Mannschaft" (Auxiliary SS) – a ragtag bunch of personnel drafted from Volkssturm, Army and basically any other source SS could get people from to try and keep camps running to the last moment while personnel of the SS proper could escape. These troops did not go through the usual SS selection process and did not get the same training as SS-TV personnel, so their behaviour could be very varied. But due to the chaos caused by quickly progressing Allied offensives, almost no documentation exist on what happened in camps in those days.
P.S. While searching for sources for this answer, I kept finding stories about dismissal of guards deemed "too kind" to prisoners. I couldn't track down any of these to a reliable source, but there might be some truth to them. If true, it would serve to further reinforce the Eicke principles.
P.P.S. Regarding your "parole to criminals" question – they weren't drafted to be camp guards, but you might want to read up on Strafbatallions (Army version, pretty tame and generally drafted from minor offenders) and Dirlewanger Brigade (SS version. It was initially supposed to be drafted from poachers. That idea was quickly lost, and the unit was drafted from murderers, burglars, criminally insane and so on. It had its debut during the occupation of Poland, and quickly earned itself the reputation of being a congregation of slaughterers, looters and rapists. Believe or not, but things went downhill from there.).
Комендант Освенцима. Автобиографические записки Рудольфа Гесса.
(unofficial translation of "Commandant of Auschwitz : The Autobiography of Rudolf Hoess", Deutsche Verlags-Anstalt, Gmbh., Stuttgart, 1958)
Koehl, Robert, "The SS: A History 1919–45", Stroud: Tempus, 2000