Managing people

Everything you need to know about reference checks

Undertaking reference checks can be time consuming, but it's an important step in the recruitment process. With our guidance and tips you'll be able to navigate this step and seal the deal with confidence. 

Your intuition or gut feeling can support your checks, but alone they are simply not enough. Reference checks can reveal chinks in a candidate’s armour.

Do you really know who you are hiring?

According to the Monster Special Report – the Future of Work 2021 Global Outlook, almost two-thirds of employers (66%) say that candidates exaggerate their skill level on their resume. Cover letters candidates often put together to support an application are also notorious for embellishment and exaggeration.

Testimony to the importance of references can be seen in these cases, some with serious ramifications:

  • The resume of former Australian of the Year finalist and women's rights activist, Eman Sharobeem, including her professional qualifications and multiple PhDs, one in psychology and another in management leadership, appear to be false. This follows the freezing of her assets and the possibility of up to five years' jail term as part of a fraud investigation into her unexplained wealth by the NSW Crime Commission and the ICAC. Ms Sharobeem ran the Immigrant Women's Health Service organisation for 11 years until 2015. It appears that her fraudulent backstory went unchecked.

  • ​The scandal involving one of Australia’s largest retailers and the fake engineer, Gerald Shirtcliff, who oversaw the construction of the CTV building that collapsed in the 2011 Christchurch, New Zealand earthquake killing 115 people. Among other fabrications, Shirtcliff stole the identity and qualifications of Will Fisher, an English engineer he knew 45 years ago.

Are online resumes and LinkedIn profiles the answer?

Cornell University researchers found these tended to be more accurate than traditional resumes, possibly due to a belief that you are more likely to be found out if you lie on such a public forum as the internet. However, on the flip side, experienced recruiter Greg Savage has noted the increasing prevalence of ‘LinkedIn Liars’.

The importance of references

A diligent reference check:

  • allows you to obtain independent information about your candidate’s previous on-the-job performance, directly related to the key selection criteria of the role on offer

  • opportunity to address any missing links or burning questions based on the candidate's resume or from their interview, such as the reasons they may have left a past position 

  • can uncover anything in a candidate’s past from criminal convictions and bankruptcies to stealing company funds and being terminated from employment

  • provides an opportunity to determine if your potential new employee will be a good cultural fit for the business.

How to handle reference checks

1. Verify the authenticity of the referees – err on the side of caution. Anyone of these strategies will give you peace of mind.

  • Call the HR department to confirm the referee you will be calling actually works in the company. It’s not unheard of that names of so-called previous ‘managers’ have turned out to be colleagues or friends

  • Corroborate the details they have given you on LinkedIn

  • Connect with them on LinkedIn after you’ve spoken to them and thank them for taking the time to speak to you. This will confirm you have been talking with an authentic referee

  • Request the referee to send you the information in a company email

  • Rather than ringing their mobile call them via the company's main business number

2. Prepare by having some key questions ready, but don’t allow this to become a box-ticking exercise.

Listen carefully and be ready with some follow-up questions. Dig deeper where necessary.

3. Schedule an appropriate time to ring the referee.

Show them the courtesy of checking with them first and forewarning them on how much time the conversation should take.

What you're looking for in a reference check

  • a candidate’s previous employment history

  • education and qualifications

  • past positions and responsibilities

  • their strengths and achievements

  • whether they are a team player or an independent worker

  • if they got along well with management and co-workers

  • any issues that impacted their job performance

  • what challenges to anticipate, what areas they need to work on

  • how they respond to pressure, show stress and react when things go wrong.

Why you need the insights

Aside from ascertaining you're hiring the right person for the role, the insights gained from reference checks will provide the 'new' employee’s manager with helpful information to better prepare them for their recruit. They will also help you decide if you are placing the person with the right manager whose leadership style will work well for both of them.

Negatives from the reference check?

Consider any negative responses carefully. They may not be entirely relevant to the role being filled – even the greatest employees have room for improvement in one or two areas. The most important thing to consider is whether they fit your company’s culture.

11 tips for reference checks

1. Beware of the over-embellished and super impressive resume. Never take anything at face value.

If a resume seems too good to be true, it probably is. It’s easy for a candidate to tailor or embellish their experience to fit a particular role and make their experience look impressive. 

No matter how amazing a candidate may appear on paper, and regardless of how impressive they may have been when you interviewed them, still undertake the reference checking process.

2. Request a minimum of two referees. Obtain the candidate’s permission prior to contact.

Interviewing more than one referee allows you to see any emerging patterns. Although the candidate has supplied names and contact details of referees, seek permission before proceeding with checks. 

3. Have a standardised process in place.

What you do for one candidate you need to do for all candidates.

4. Speak with current or previous managers where possible.

They will have recent interactions with the candidate and can draw on examples.

5. Cross-reference all the information you are building. Take a risk management approach.

Is there anything that doesn't add up? Be alert for any red flags. Your goal is to limit the negative impacts a wrong hire could have on your business.

6. Prioritise the cultural fit for your organisation.

Workplace culture is important. Consider the team dynamics and how the candidate will fit in. You can always train for new skills or skill gaps. 

7. Don’t ask for information that could be considered discriminatory.

Know the law in relation to the corresponding privacy laws and regulations surrounding reference and background checks. 

8. Listen carefully to what the referee is saying - have they omitted anything?

Any omission could be intentional if it's an area where your candidate doesn’t excel, has a weakness or has experienced issues. 

9. Ask open-ended questions, not leading questions. 

It's best to ask the referee to comment on or rate on a scale of one to 10, otherwise you will get ‘yes’ or ‘no’ answers, which give you little insight. If you want more detailed information, ask for a specific example. Ask similar questions you asked the candidate. One good question is 'why they left the business'? See if the answers align. 

Questions around time management, decision-making, communication, integrity and initiative will give you good insights.

10. A must-ask question and one that speaks volumes is “Would you employ this candidate again?”

If conducting verbal checks, listen for any hesitation or on the other hand, if the referee appears to be exaggerating. It can be an indicator that the truth is being stretched. 

11. Establish if there are any inconsistencies.

The information you gather during a reference check should be directly related to the key selection criteria of the role or job description. The reference checks allow you to validate the information provided by the candidate at the interview.

My Business Workplace has a recruitment checklist as well as other resources to help you to recruit. 

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