What you need to know about reference checks
Many employers question the value of reference checks – they can be time consuming, especially when you are keen to sign off on your selected candidate. So how can you ensure you get the most value from the exercise?  

Reference checks are an imperative part of the recruitment process, says Manisha Maligaspe, Oceania Transaction Advisory Services Recruitment Lead for EY. “Genuine reference checking is about whether the candidate actually worked at the place they said they did and carried out the tasks they said they were doing,” she says. “Essentially, it’s a means of verifying the candidate’s skills and experiences they represented in their resume and throughout the assessment process and interviews.” 

While reference checks can be time consuming, thoroughly checking out a candidate before you offer them a position is likely to save you time in the long run and potentially avoid any issues later on.  

The difference between personal and professional references

A personal reference is someone who has not worked with the candidate and who can discuss the individual’s values, characteristics and personality. A professional reference is usually a former employer, client, colleague or supervisor who can recommend the candidate’s work ethic, skills and attitude. 

“In a perfect world, the candidate would provide a previous manager or supervisor that they have reported to directly,” says Maligaspe. “A professional reference check, ideally where the candidate has reported to that individual, is usually an accurate confirmation of the candidate’s employability and skills.”

Employers might ask for a personal reference if the candidate is young or has not had much experience, but Maligaspe says it’s usually best to ask candidates to provide the name of at least one professional referee. 

How to get around a ‘no reference policy’

A ‘no reference policy’ is when an organisation has a rule not to give verbal and / or written references about current or former employees. 

Hirers can ask candidates to check with other recent employers to see if they are willing to give a reference or ask for a character reference from an ex-colleague or former manager at the previous employer in lieu of a formal reference. “You could even ask for a candidate to provide performance review feedback in lieu of a reference check,” says Maligaspe. 

Can candidates legally ask to see notes from a reference check?

“If the prospective employer has obtained referee reports for the unsuccessful job applicant, then the applicant is entitled to access those referee reports,” says Kelly Godfrey, Principal Solicitor with Employment Lawyers Australia. 

The reason for this is that an inaccurate referee’s report can affect a candidate’s employment opportunities. “As such, a job applicant has the right to access and correct any personal information that is held about them,” Godfrey adds. 

What you can and can't say about former employees 

References are a tricky legal area, says Godfrey. “If you are asked to provide a reference and it is not favourable to the employee, it may be easier to decline and provide a statement of service instead.” 

A statement of service sets out the employee’s commencement date, finish date, sometimes the reason for termination, position titles held and may briefly describe the duties the employee undertook. “The statement of service gives no assessment of how well the former employee performed in the role,” says Godfrey.

“If you decide to provide a reference, good or bad, to reduce the legal risks involved, you should ensure that there is objective evidence to support the statements you make.”

Best practice reference checks

Talk to the right people 

“For the employer to get an accurate picture of how the candidate performs in a professional environment, the reference check provider has to ideally be a supervisor or manager – those who can speak knowledgeably about the applicant’s performance, communication, cultural fit and work ethic,” says Maligaspe.

Protect the candidate’s privacy 

“The employer should ask the candidate whether they have informed their previous employer of their job search otherwise it would be a very awkward situation,” advises Maligaspe.

Ask the right questions and be specific

“Employers should implement behavioural-based interviewing in a reference check situation,” says Maligaspe. “Such as, “Tell me about a time when Joe went above and beyond to complete a critical task”. Questions like this provide in-depth insight into a candidate’s interpersonal skills, adaptability and overall work ethic. 

Remove referee bias and be wary of fake referees 

“Usually a candidate will provide referees who will speak favourably about them to increase their chances of securing the job,” says Maligaspe. “Always ask the referee for any areas of development the candidate has, any skills they think the candidate should improve on or any projects they would like to see the candidate working on in the future. If a candidate provides a referee’s details, do your due diligence. Contact the referee’s land line directly and look them up on LinkedIn prior to conducting the reference check to make sure they are who the candidate says they are.”