Employment Reference Checking

A Crash Course

The Basics

Why check references?


In business making decisions without evaluating all the facts can generally lead to expensive mistakes. There is a balance between undertaking core profit making tasks and following an often costly recruitment process. It is the responsibility of the hiring manager to ensure the information surrounding a candidate has been sufficiently acquired and vetted prior to making a job offer.

Time and time again businesses will fail and make bad hiring decisions on the basis of something that was overlooked in the recruitment process. Usually the first quality measure that is left out is the reference check.

One of the primary reasons for undertaking a reference check is to avoid being blind-sided by an employee that is not willing or capable of doing the job that they applied for, but their application suggested otherwise and they were interviewed for for the role.

Information Gathering

If you have worked in sales or ever done a presentation then no doubt you have walked out of a meeting after doing very well and suddenly realised that you missed parts of your pitch out. What makes you think that it is any different for even the best candidates at interview?

Employment reference checks are not witch hunts – you should never approach them to see if you can dig up dirt (more on that further down). Often candidates in their eagerness to present themselves might omit details about key experiences that a skilled reference checker might pick up.

Evidence & Compliance

As an HR Manager or Recruiter when you present a short-list one of the questions that you will be repeatedly asked is “How do you know that?”

The employment reference checking process is part of building a chain of evidence that puts you in control of a valid decision making process.

You answer should always be “I checked!.”

Information Is Power

If you undertake a reference check and you don’t come out with more knowledge about the candidate and their work experience then you don’t have the necessary information to make a hiring decision.

TIP: Do some role play with colleagues using each other as the “candidate” ~ you will get better with practice.

It is common to learn new facets about a candidate’s experience and whilst these may be interesting you have to look at them objectively. For example where do they fit in to the assessment of the candidate?

Consider this response:

John was careless when using a forklift truck when he 
was on his own in the warehouse.
  • Is the job John is going for going to require him to use a forklift?
  • If he was on his own how does the referee justify carelessness?
  • Does careless mean messy, unsafe not following procedure?
  • Does this mean he can work unsupervised?
Where to tick the box?
Positive Negative
Relevant ? ?
Irrelevant ? ?

This example shows how we can gather the evidence but it does not imply, by itself, how we should evaluate it.

You should always gain the permission from a candidate to speak to their referees from them directly by asking. This does two things:

  1. It shows that you are polite,
  2. It reminds the candidate that they should have the permission of the referee to have them be contacted in the first place.

When you have the response from a referee then you should use it in further interview processes and conversations with the candidates.

Me: John can you tell me about the warehouse work that you used to
do and what was involved?

John: I used to check the goods for dispatch and wait for the truck
to arrive. I arranged the pallets in the middle of the bay so I 
could load the truck quicker by being organised.

Is John being careless? Is his arrangement of the pallets unsafe? Is it an example of an employee adding efficiencies to the work place procedures? – like anything it depends on the role they were in and the role they are now applying for. Clearly this is a contrived example and only for the basis of understanding how information that is collected through the reference check process should be used.

Questioning Techniques

There are example reference check forms at the bottom of every page of this site, there is nothing stopping you from copying them and extending them for your own purposes. But beware that checking employment references is not just about rattling through a list of questions in a rush to rubber stamp the strongest candidate.

One of the key attributes we look for in Reference Checking Consultants is an enquiring and analytical mind. The questions should provide a basis for a check but it is the conversation that provides the value.

Open and closed ended questions are used to probe and evaluate a response to make sure that you get to the desired level of detail required in a professional reference check:

Closed Question
Q: Would you hire this worker again?
A: No
Open Question
Q: What would make you consider hiring this worker again?
A: All staff need a forklift ticket, so if they got 
   their ticket they could come back

Aims of the check

Performing a correct reference check is not an exercise in endorsing or rejecting a candidate it is an exercise in collecting information with which to use in a hiring decision.

A lack of objectivity is the biggest killer of a valid reference check.

It is too common for line managers to pass reference checks off to their assistants who are already drowning in previously delegated tasks. Every Recruiter has made the mistake at one time or another of pinning their hopes to a candidate which has lead them on a crusade and ignored crucial aspects of the reference checking process.

Key Points

    • Reference checking is part of recruitment process and should be given a comparable weighting to the CV and interview in terms of evaluation.
    • Checking a reference is a two way street and asking the right questions in the right way has a significant effect on the validity of the reference check and the outcome of the hiring decision.
  • Don’t go into a reference check with a preconceived idea of the responses you will be getting, and don’t just read off a form – a balance of objectivity and evaluation needed.

Why Reference Checks are worth it:

If someone is costing you $80,000 per year then the cost of recruitment is going to be around $5,000 – $15,000.

It will take 3 months for them to get past probation and that is when some of their bad traits are going to manifest.

When you terminate them you are going to be paying out leave and the exit process will probably take 3 more months.

And then you will have fund the cost of another recruitment process.

Cost of Recruitment: $5,000 – $15,000
First 3 months costs: $20,000
Managing them out over 3 months: $20,000
Holiday pay out: $3,250
Cost of Recruitment again!: $5,000 – $15,000
Total: $48,255 – $68,255