Reference Check – Best Practices

Recently, a customer 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? Most companies will confirm very basic information, such as employment dates.”

I noticed that my impression was based on very old information. After all, I had not performed reference checks or investigated related best practices for 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:

It is not a background check, which may include a drug test, criminal records check and other data verification.

It is not an Employment Verification, which confirms employment, salary, title and readmission dates (although a thorough reference check may also include employment verification).

The best definition I’ve found to explain the purpose of a reference check is this: a reference check focuses on checking the opinion of previous colleagues about an individual’s performance.

Why perform reference checks?

The main reason is that past performance is one of the strongest predictors of future performance. Collecting accurate and balanced information (covering both positives and negatives) from previous job applicants of an applicant can greatly increase your chances of avoiding hiring mistakes and hiring people who will perform well.

What challenges are there when performing reference checks?

Here are some of the main challenges:

  • Not enough quality references
  • It can be difficult to reach them
  • It can be difficult to get valid data
  • Time and costs
  • Most people don’t like doing this kind of work

What are the main features of a good reference source?

When you perform reference checks, you want to speak to individuals who have been able to observe your applicant’s performance. This also includes people who have worked with or for the candidate or who have guided the candidate. It does NOT include family members or friends.

Other important parameters to consider are:

  • Duration of the relationship
  • Freshness of relationship
  • Nature of the relationship
  • Proximity to relationship

Is providing reference control data legally risky?

While legal issues can arise from the reference audit process, they are usually the result of bad practices such as discussing prohibited topics.

According to the 2004 Reference and Background Checking Survey Report, prepared by the Society of HR Management, only 2% of companies are charged with defamation based on credentials. It is important to note that the standards applied to referral libel suits are the same as those for libel suits – the claimant must demonstrate not only damage but also malicious and dishonest intentions. This is a very high bar.

If you think about it, there can also be a risk in providing positive information. If you make positive comments about a candidate and the prospective employer hires the candidate and the candidate performs poorly, that employer may sue you for not disclosing complete information.

Lately, many states have adopted what are called “truth in reference” laws. These laws protect companies that provide references as long as the employer providing the reference provides only factual, documented information. (An employer may NOT provide information about costs of discrimination an employee may have imposed against that employer.)

How to improve legal defensibility and obtain better information

Here are some practical tips that can help you reduce legal risks and collect better quality information:

  • Have each candidate sign a written consent form and a liability waiver
  • Ask the same questions to all reference sources
  • Make sure all questions relate to job requirements and employee performance or behavior in their previous job (s)
  • Include open questions about the candidate’s strengths, performance and areas for improvement
  • Also ask, “If you get the chance, would you hire the candidate again? If not, why not?”
  • Encourage the reference source to provide evidence of work performance based on observable work behavior
  • Avoid questions about prohibited topics, including:
    • Age
    • Disabilities or health problems
    • Marital status
    • Sexual orientation
    • Stable family life
    • Childcare arrangements
    • Care for elderly parents
    • Requires free time from work to practice religion

    What else can I do to make the reference verification process as simple and productive as possible?

    There are online services that can help you manage the reference verification process quickly and efficiently and improve the quality of the information you receive. The reasons why these services work so well include:

    • The applicant invites his references to participate
    • References are anonymous, which increases the willingness of reference sources to provide more detailed information about the candidate’s strengths, weaknesses and perceived performance
    • The applicant must sign an online Consent Form and a Disclaimer of Liability Form
    • The use of an automated process ensures consistency in the questions asked

    Where can I find more information?

    An online service called Checkster offers some short videos who explain how their service works. They will also send you an excellent list of questions about reference checks if you send an email to info@checkster.com.

    Overview tips

    Finally, here are some summary tips that will help you perform productive, effective reference checks:

    • Create and follow a structured process
    • Ask candidates to sign a written consent form and a liability waiver form
    • Focus discussions on performance and work-related behavior
    • Ask probing questions about the candidate’s strengths, achievements and areas for improvement
    • Take detailed notes
    • Consider using a tool like Checkster to automate your reference checking process and provide anonymity to reference sources, increasing their willingness to provide useful information

    © 2010 Alan Rigg



    Source by Alan Rigg