What is a Reference Check? Understanding the Purpose and Importance
Before hiring an employee, most companies conduct a reference check. A reference check is the process of making contact with previous employers or other relevant individuals to confirm and validate an applicant's employment history, qualifications, and character. It's a critical component of the hiring process, as it helps employers make informed hiring decisions and mitigate the risk of hiring the wrong person for the job.
The Purpose of a Reference Check
The primary purpose of a reference check is to verify the accuracy and authenticity of the information provided by the job applicant during the selection process. It is a way for employers to assess an applicant beyond their resumes and interviews, and to gain a more objective perspective of their qualifications, work ethic, and personality. A reference check can uncover red flags that were not apparent during the selection process, such as discrepancies in employment history, unprofessional behaviour, or issues with job performance.
A reference check can also help employers learn more about an applicant's strengths and weaknesses, work habits, and interpersonal skills. For example, the reference may provide details about the applicant's communication style, teamwork ability, or leadership potential, which can be valuable in deciding whether the candidate is a good fit for the role.
The Importance of a Reference Check
A reference check is an essential part of mitigating the risks associated with hiring new employees. According to CareerBuilder, around 29% of employers who made a bad hire in the past year lost over $50,000 due to the mistake. A bad hire can negatively impact the company's productivity, morale, and culture, and can even lead to legal issues. Conducting a comprehensive reference check can help employers reduce the likelihood of making a costly hiring mistake, and ensure that they hire applicants who are capable of performing the job well.
In addition to helping employers make informed hiring decisions, a reference check can also benefit the applicant. It provides them with an opportunity to showcase their skills and accomplishments to potential employers, and to address any concerns or misunderstandings that may have arisen during the selection process. A positive reference can be a valuable asset for job seekers, as it can increase their chances of landing a job, and help them stand out from other applicants.
How to Conduct a Reference Check
Conducting a reference check involves several steps, including identifying appropriate references, making contact, asking relevant questions, and recording the information gathered. Here is a step-by-step guide to conducting a successful reference check:
1. Identify the appropriate references
Before conducting a reference check, the employer should determine which individuals are suitable to serve as references. Typically, a candidate's previous managers or supervisors, co-workers, or clients may be good sources of information. Ideally, the references should have worked closely with the applicant and have firsthand knowledge of their work performance, skills, and character.
2. Make contact with the references
Once the appropriate references have been identified, the employer should contact them to request permission to conduct a reference check. This can be done via email or phone call. If the reference agrees, the employer should provide them with details about the position and the hiring process, and ask for their honest feedback.
3. Ask relevant questions
During the reference check, the employer should ask relevant questions that relate to the position and the applicant's work history. For example, they can ask about the candidate's job responsibilities, achievements, strengths and weaknesses, and areas for improvement. They may also ask about the candidate's work habits, interpersonal skills, and overall performance.
4. Record the information
Finally, the employer should take detailed notes of the information gathered during the reference check. This information can be used to make informed hiring decisions, and to compare and contrast different candidates.
Real-Life Examples
The importance of reference checks is evident in real-life examples. In one case, a late-stage start-up hired a new executive who was highly skilled and had an impressive resume. However, they failed to conduct a thorough reference check. After several months on the job, it was discovered that the executive had misrepresented their work history, and had a history of toxic behaviour towards colleagues. The company was forced to terminate the executive, losing valuable time, money, and credibility in the process.
In another case, a small business conducted a reference check on a new employee who had an otherwise impressive resume. During the reference check, the previous employer expressed concerns about the employee's tendency to be tardy and not take feedback well. The small business decided to hire the applicant anyway, but soon found that the previous employer's concerns were valid. The employee's tardiness and poor attitude caused tension within the team, and ultimately led to their resignation.
Conclusion
In conclusion, a reference check is a crucial step in hiring new employees. It helps employers make informed hiring decisions, mitigate risks, and ensure that they hire applicants who are capable of performing the job well. Conducting a thorough reference check involves identifying appropriate references, making contact, asking relevant questions, and recording the information gathered. Ultimately, a well-executed reference check can help companies avoid costly hiring mistakes and build a stronger, more productive workforce.
