Do you always check references before offering a position to a new employee?

If the answer is no, consider this: how do you know that the candidates for the last role you hired for – perhaps even the successful candidate! – didn’t exaggerate their experience and qualifications?

Reference checking is a vital step in the recruitment process to ensure what the candidate has presented at the interview is a true reflection of how they will perform for your organisation.

Not convinced? This true story from the HR Coordinator for a large NFP based in Melbourne may help sway you:

I recently interviewed a candidate who was applying for a case management position. After the interview the panel of three were impressed – the candidate clearly had the skills to do the job and seemed like a great fit for the team. There was something odd about his reference list though; he had provided two references, but neither from his most recent two positions even though he had advised us that his current employer knew he was seeking other work.

I asked the candidate to provide a reference from his current work place and he did so. When I called I found out that he had actually finished up at that organisation a month ago. He had been fired for misappropriation of funds. Apparently it had happened at his previous place of employment as well, but as his most recent employer had not completed a reference check prior to hiring him, they hadn’t found that out until it happened to them.

Imagine if I had not taken the time to chase up more recent references?

Effective reference checking doesn’t need to be time consuming. Here are some tips to make sure you get the information you need to make your decision:

1) Call two referees.

It’s always worth getting a second opinion.

2) Make checking references the last thing you do before hiring.

You usually only need to check references for the candidate you’ve decided to hire, or at most two candidates if you can’t otherwise choose between them. This means you should only have to make two calls, or four at most.

3) Ask the candidate to provide details of their most recent managers.

If a candidate has provided contact details for peers, personal references or contacts for organisations worked at several years ago, ask for something more recent.

If the candidate has not disclosed to their current employer that they are seeking other work they may be reluctant to provide details. In that case, requesting to speak with a trusted senior peer or another colleague at their current workplace who could provide some background on their work would be an alternative. If they allow it, go ahead with a lie detector test.

4) Call the organisation and ask to be put through to the referee.

The simple step of calling the organisation rather than a mobile phone number or direct line ensures you are contacting a referee who does work at the organisation rather than a friend posing as a referee.

5) Have your questions ready and ask the same questions to each referee.

This will allow you to compare the opinions of all referees on the same topic and give you an idea of how the applicant has performed over a period of time.

6) Ask open-ended questions.

Rather than asking “does Sam work well in a team environment” where your likely answer will be “yes” with little other detail, ask questions such as “what qualities does Sam bring to a team?” or “can you tell me how Sam has demonstrated strong teamwork in her current role?”. This is particularly important when asking about areas in which improvement is required.

7) Listen to the answers, and ask for more information if you need it.

If a referee provides a limited answer to a question or you get the feeling there is something they aren’t saying, don’t be afraid to ask for more information. A simple way to do this is to paraphrase their answer and request more information, such as “you have said that Tony meets deadlines most of the time. Can you tell me about a time Tony didn’t meet a deadline and how he handled it?”. If a referee sounds hesitant, uncomfortable or refuses to answer your questions these are red flags and you should proceed with caution.

Managers often complain that reference checking is a waste of time as candidates wouldn’t provide details of a referee who is going to provide negative feedback.

But HR professionals estimate that about 5% of referees contacted supply less than glowing reports on a candidate – that’s about 1 in 20 referees.

That means even if the last 19 references you’ve checked have been glowing, it’s still worth picking up the phone again.

Using a solid reference checking process will give you a complete picture of your preferred applicant and help you to avoid making a hiring mistake that could cost you time, money or worse still, a police investigation as could have been the outcome of the story above.