Reference Checking: Best Practices
A client recently asked me to provide them with a list of reference check questions as part of a sales recruiting project. My gut reaction was, “Reference checks? Why bother? All most companies will provide is confirmation of very basic information, like dates of employment.”
It struck me that my impression was based on very old information. After all, he hadn’t done any reference checks or research related best practices for many years. I decided it was time to review the current state of reference checking and summarize my findings in this article.
What is a reference check?
Let’s start by clarifying what a reference check is not:
There is a background check, which may include a drug test, criminal background check, and other fact check.
It is not Employment Verification, which confirms dates of employment, salary, title, and rehire eligibility (although a thorough reference check may include employment verification).
The best definition I found to explain the purpose of a reference check is this: A reference check focuses on verifying previous colleagues’ opinions of an individual’s performance.
Why perform reference checks?
The main reason is that past performance is one of the strongest predictors of future performance. If you can gather accurate and balanced information (addressing both positives and negatives) from a job candidate’s previous employers, you can dramatically increase your chances of avoiding hiring mistakes and hiring people who perform well.
What challenges are involved in conducting reference checks?
Here are some of the key challenges:
- There are not enough quality references.
- It can be hard to get to them
- May be difficult to obtain valid data
- time and cost
- Most people don’t find doing this kind of work very fun.
What are the key characteristics of a good referral source?
When running reference checks, you want to talk to people who have been in a position to watch your candidate perform for the position. This includes people who have worked with or for the candidate or who have supervised him. Does NOT include family or friends.
Other important parameters to consider are:
- length of relationship
- freshness of the relationship
- nature of the relationship
- closeness of relationship
Is providing reference check information legally risky?
While legal challenges can arise from the reference checking process, they are usually the result of bad practices, such as discussing prohibited topics.
According to the 2004 Reference and Background Check Survey Report compiled by the Society of HR Management, only 2% of companies are sued for defamation based on references. It is important to note that the standards that apply to reference-based defamation lawsuits are the same as those that apply to defamation lawsuits: the plaintiff must prove not only harm, but also malicious and dishonest intent. This is a very high bar.
When you think about it, there can also be risks to providing positive information. If you make positive comments about a candidate and the potential employer hires you, and the candidate performs poorly, that employer could sue you for not disclosing complete information.
Lately, many states have enacted what are known as “truth in reference” laws. These laws protect companies that provide references as long as the employer providing the reference only provides documented and factual information. (An employer should NOT provide any information about charges of discrimination an employee may have brought against that employer.)
How to improve legal defense and obtain better information
Here are some best practices that can help you reduce legal risk and collect better quality information:
- Have each candidate sign a written consent form and a liability release form
- Ask all referral sources the same questions
- Make sure all questions relate to the job requirements and the employee’s performance or conduct during their previous job(s)
- Include open-ended questions about the candidate’s strengths, accomplishments, and areas for improvement.
- Also ask, “If given the opportunity, would you hire the candidate again? If not, why not?”
- Encourage the referral source to provide evidence of job performance based on observable job behavior.
- age
- Disabilities or health problems
- Civil status
- sexual orientation
- stable family life
- child care arrangements
- Caring for elderly parents
- Require time off from work to practice religion.
What else can I do to make the reference checking process as easy and productive as possible?
There are online services that can help you manage the reference checking process quickly and efficiently and improve the quality of the information you receive. The reasons these services work so well include:
- The job candidate invites their references to participate
- Referrals are anonymous, which increases the willingness of referral sources to provide more detailed information about the candidate’s strengths, weaknesses, and observed performance.
- The job candidate must sign an online consent form and a liability release form
- Using an automated process ensures consistency in the questions asked
¿Where can i get more information?
An online service called Checkster provides a series of short videos explaining how their service works. They will also send you a great list of reference check questions if you email [email protected].
Summary of tips
In conclusion, here are some summarized tips to help you conduct productive and effective reference checks:
- Create and follow a structured process
- Ask candidates to sign a written consent form and a liability release form.
- Focus discussions on performance and job-related behaviors.
- Ask probing questions about the candidate’s strengths, accomplishments, and areas for improvement.
- take detailed notes
- Consider using a tool like Checkster to automate your reference checking process and provide anonymous reference sources that will increase your willingness to provide useful information.
©2010 Alan Rigg
