How to perform reference checks on prospective hires

You’re nearly at the last stage of the recruitment process, and you believe you have the right selection of candidates to choose from, but you’d like to get more information about their past performance to make a final decision?

It’s time to do a reference check. 

A reference check generally involves checking the candidate’s employment history and speaking to past employers, but is not limited to that.

Before you start doing reference checks, there are several key questions that you need to address:

• What information do you need to collect? 

• Should you rely on written references?

• What are the best questions to ask during a reference check?

• When is the best time to do a reference check?

• How do you deal with negative feedback about a candidate?

This article will address all these questions, and more. 

But let’s start with the basics: what a reference check is. 

What is a reference check?

A reference check is a step in the hiring process in which an employer requests information about the candidate from former employers and colleagues to learn more about the candidate’s background, credentials, and skills. 

As a minimum, you need to verify the applicant’s employment dates, job titles, and responsibilities on the job. An in-depth reference check will provide you with insights into the candidate’s skills, qualifications, and knowledge, as well as into their performance in past positions.

One thing to keep in mind is that a reference check isn’t the same as a background check. A reference check focuses on the candidate’s abilities, performance, experience, and credentials, whereas a background check verifies their job history and even 

criminal record. 

Many companies perform background checks: according to SHRM, 92% of companies use background checks as a part of their hiring process.

Why do you need to ask for a reference check?

According to Gallup, a mis-hire can cost you up to 2 times the annual salary of the employee. Mis-hires cost the US economy more than a trillion dollars a year, which only goes to illustrate how common the problem is. According to a study by Brandon Hall Group, 95% of organizations admit to making hiring mistakes every year.

To avoid mis-hires, companies must make sure the candidate has the right skills and attitude, and reference checks can be key in assessing both. 

With a reference check, you’re learning a lot of things about your candidates. You’ll be checking: 

• Whether they performed well in a previous job

• How productive and efficient they were

• Whether they had the right attitude and behavior 

• Whether they have the right culture add potential for your role

You’ll also learn about their past successes and failures, strengths and weaknesses, and their teamwork skills.

The best thing about reference checks is that references come from previous co-workers, direct managers, and peers, or, otherwise said, the people with whom the applicant worked every day. And, in most cases, they’re the ones who can provide you with the most accurate snapshot of the candidate’s skills.

Reference checks do’s, don’ts, and red flags

There are specific dos and don’ts that HR staff should follow when conducting reference checks. 

Below, you’ll find some key things to remember when talking to your candidate’s ex-coworkers or managers. 

Do’s

When doing a reference check:

• Concentrate on a few key issues only. Reference checks are quite resource-intensive for everyone involved, including the person you’re speaking to, so you need to concentrate on the most important things you’d like to look into. Gather feedback from everyone who interviewed the applicant and focus your attention on the key issues that come up.

• Inquire specifically about the candidate’s job performance. Past job performance is the most accurate predictor of future job performance, so, regardless of whether you’re speaking to a candidate’s ex-manager or an ex-colleague, get into the details of how well they did by asking specific questions. 

• Listen to what they have to say to you without interrupting or probing. Always ask just one question at a time and simply let the other person speak. Pause for a few seconds before following up with another question: the most important things you hear might come up right after you believe the person has already finished answering. 

• Find a few different sources of information. The HR policies of some organizations might restrict the scope of information you can get and limit it to the most basic details (educational background, degree, job title). Try to identify additional sources of information such as professional networks, other past employers, and LinkedIn to increase your insight on the candidate. 

Don’ts

When speaking to past employers and peers:

• Don’t ask “yes or no” questions. Ask open questions to gather as much information as possible.

• Keep your own biases in check. Use neutral wording in order to get accurate and unbiased answers, and be mindful of your own biases, which might affect the interpretation of answers you receive. 

• Don’t try to read too much into someone’s tone of voice or body language. You might misinterpret the context and form the wrong impression about your candidate, especially in multicultural workplaces.

• Don’t automatically reject a candidate for one inconsistency or negative review. There are a lot of different reasons why someone might give a negative opinion on a past employee. Give your candidate the benefit of doubt and try to probe further and speak with a second person, if possible.

Red flags

When reviewing references, be mindful of red flags. These show that the applicant may not be the ideal match for your company, so if you see any red flags, be cautious. 

• Disproportionately negative feedback. There might be some negative feedback and you should always look deeper into it. However, if the vast majority of references offer unfavorable remarks about your candidate, that’s probably a clear sign that the candidate isn’t the best fit for your company. 

• Inconsistent information. Check to see whether what the applicant told you matches the records they had at their former job. If there are any inconsistencies or contradictions, double-check to ensure that there isn’t a misunderstanding. If there’s a discrepancy, discuss this with the applicant before judging the situation.

• Overly positive comments. When you check their references and only receive positive responses about the candidate, beware that you might not be getting the complete picture. Try to find additional references from their previous employers to acquire a more balanced view of the candidate you want to hire. 

What questions should you ask when checking references? 

When doing a reference check, ask open-ended questions but try to make those questions as specific as possible. If your questions are vague or nonspecific, you’ll get answers like “They’re great!”, which aren’t helpful when making hiring decisions.

Below, you’ll find a few questions you can ask when checking references. Tailor them to the specific role for which you’re recruiting, and take notes while on the phone.  

• Why did the candidate quit?

• Can you tell me about the relationship they had with you? How about their relationship with other co-workers and managers? 

• Do you think they work better together in a team or alone?

• Can you tell me about the candidate’s responsibilities at work? 

• Can you tell me more about their performance at the job? 

• On a scale of 1 to 10, how successful was the candidate at their job overall? What would take them to become a 10?

• What are their most important accomplishments? 

• For this role, we need someone who can _____ (two or three key responsibilities). How would you rate them for each of these? Why?

• Would you rehire this candidate for the same position if you had the opportunity today? Why? 

• What are the candidate’s major strengths?

• What are their most important weaknesses? 

• Can you tell me about a challenging situation the candidate encountered at work? How did they deal with it? 

• Tell me about an instance where the candidate had a conflict at work. How did they handle the situation?

• What would be the most effective method to lead and manage this candidate? Why? 

• What information should I know about them I haven’t previously inquired about?

• Can you tell me an area where they lack experience or skills?

• Is there a particular area where they’d need additional training or coaching during the onboarding period?

• Please tell me about an instance where the candidate received negative feedback. How did they respond to it? 

• Is there anyone else you’d advise me to speak to?

Tips for getting the most out of your reference checks 

Although reference checks are quite common, sometimes hiring managers hurry through them or overlook important aspects of the process. 

Below, you can see a few of the best practices for reference checks, which will help you create a positive candidate experience and get enough information about your candidates to make the right hiring choice. 

1. Tell your candidates you’ll perform a reference check

To gain candidates’ trust and attract the best talent, your recruitment process should be clear and transparent from the start. 

Let applicants know early on you’ll be performing reference checks. This helps you achieve a few goals as it’ll: 

• Help you provide a positive candidate experience 

• Facilitate the recruitment process

• Dissuade applicants from exaggerating their skills on CVs

• Get truthful responses during interviews

According to Hedd degree verification and fraud service, 49% of large businesses and 48% of SMEs interviewed candidates who lied about degree qualifications on their CVs.

2. Combine reference checks with pre-employment tests 

Giving your candidates a pre-employment assessment is an excellent way to get more in-depth information about their skills, knowledge, and behavior, and when coupled with a reference check, it’ll give you plenty of reliable data to help you make the best possible decision. 

Pre-employment tests are an excellent way to filter out unqualified candidates early on, and optimize hiring. For this reason, we recommend performing skills tests in the early stages of the recruitment process, while doing reference checks only for your top candidates.

Skills tests enable you to easily verify candidates’ claims on their resumes, as well. 

Consider the following scenario: You’re interviewing a candidate applying for the position of a junior-level JavaScript developer. On their resume, they’ve stated that they have a working knowledge of JavaScript and they’ve been using it for two years. 

A great way to verify that statement is to give them a JavaScript entry-level coding test and see how they do. 

3. Check candidates’ emotional intelligence (EQ) and motivation

Teamwork, communication, conflict resolution, motivation, and problem-solving are crucial soft skills that are necessary for almost any job out there, and they’re all related to candidates’ emotional intelligence (EQ). 

Regardless of the position your candidate is applying for, we recommend assessing their emotional intelligence as a part of the evaluation process, and reference checks are an excellent way to gain deeper insights into it. 

You can also use personality tests, such as the Big 5 (OCEAN) test or our Motivation test, in which both you and the applicant fill out a survey to test whether your expectations align. 

Other tests you can use are TestGorilla’s Communication test or Problem-solving test, to assess how applicants respond to various situations and evaluate their interpersonal and problem-solving skills. 

4. Don’t accept only written references

While written references are much easier to go through, they won’t give you nearly as much information as will a phone call.

Ask your candidates to give you a list of people you can reach to discuss their past performance, but remember to give them enough time to check in with past employers first, if needed.

Before picking up the phone, prepare for each reference check and make a list of questions you’d like to discuss on the phone, based on the candidate’s profile. 

5. Ask follow-up questions

When conducting a reference check, ask follow-up questions to get information that is both as detailed and as accurate as possible. Sometimes, a well-formulated follow-up question will help you get more information than the initial one. 

For example, you may ask the following question: 

How well did they communicate with the team?

And while the person you’re speaking to may provide information about their communication skills, follow-up questions such as “Why is that?” or “How did this impact their performance?” or “Can you give me an example?” might help you uncover valuable information that you wouldn’t otherwise get. 

6. Discuss the references with your candidates

After you get a few references (two or three should suffice), you could discuss them with your candidates. 

This allows you to address inconsistencies, should there be any, and will help you get a balanced perspective on candidates’ skills and weaknesses. This way, you’re also showing your candidates you trust them, and you also get the opportunity to see how they react to both positive and negative feedback. 

7. Do a reference check only with shortlisted candidates 

When is the best time to do a reference check? 

When it comes to reference checks’ timing, there is a sweet spot: do them towards the end of your recruitment process, but before you make a hiring decision.

If you start doing reference checks too early, you’ll be swamped with extra work. However, if you’ve already made a decision before doing a reference check, you’ll likely be biased and might end up hiring a candidate that isn’t the best fit for your company.

The best time to do reference checks is after skills tests and initial interviews, but before making an offer. This way, you’ll be able to discuss the results with your candidates, if necessary, and make an unbiased decision. 

Hire the best candidates using the right recruitment tools

Reference checks reveal a lot about applicants’ employment history, educational background, and performance in past positions. A reference check can help you evaluate each candidate and ensure that you’re hiring the perfect fit for the role.

You can check references by speaking with applicants’ past co-workers and managers, and you can also give your candidates pre-employment assessments to evaluate their skills and behavior. 

Using the right mix of recruitment tools is key to hiring the best talent, and reference checks, in combination with interviews and pre-employment tests, can give you an in-depth understanding of your candidates’ strengths, potential, and knowledge. Try TestGorilla for free.