Reference checks are an excellent means of making quality hires. You wouldn’t buy a car, without first shopping around for the best deal, would you? Hiring an employee is kind of like purchasing a vehicle: you need to do your homework before jumping into a decision in order to make sure it’s the right one.

Reference checks are important for a variety of reasons. For one, they help employers to gauge the accuracy of the information provided during the interview process. Many candidates lie or stretch the truth in an effort to appear more desirable. Determining what information is true and what is not can help support your selection decision. Reference checks are also important in deciphering how others view the applicant. Speaking with former employers and co-workers can be valuable in determining an applicant’s ability to work with others, their attendance patterns, and their overall fit for the position you are looking to fill.

With so many great reasons for checking applicant references, you may be wondering why more employers don’t. Some might not know what questions to ask, others may feel they don’t have the time or resources to do so, and some might be scared to find out something they don’t want to know about a potential candidate.

Regardless of the reason for not checking applicant references, there are so many more powerful reasons to do so. Below you will find the tools and tips you need to easily and effectively carry out the process:

1. Get applicant consent. Prior to conducting a reference check, it’s required that you obtain applicant consent. Usually this is done via the application form. You may choose, however, to have a separate authorization form in order to draw more attention to the fact that an applicant’s references will be called should you consider hiring the individual. The consent authorizes you to make investigations into the applicant’s employment or educational history and is intended to absolve employers, educational institutions, and other individuals listed as references from any liability in responding to a reference request.
   
   
2. Set aside time. A thorough reference check should take approximately 20 minutes. Prior to calling a reference be sure you have at least 30 minutes to dedicate to the process. This will allow you some time to prepare and review the questions you have put together. Afterwards, you should also spend about 5 minutes writing up additional notes and general thoughts. Keep in mind that the reference may be busy too, so when calling always ask if they have time to speak and let them know how long the discussion will take. If the reference is unable to set aside the time when you call, be sure to schedule a follow-up conversation.
   
   
3. Prepare. Prior to conducting a reference check, formulate a list of questions you’d like to ask. Common questions focus on the employee’s performance, interpersonal skills, attendance and punctuality, and their eligibility for re-hire. To get a true picture of the applicant’s experience, skills, and personality, ask open-ended questions that are specific and relevant to the position you are filling. Behaviorally directed questions are best because they allow you to determine how the applicant has performed in situations similar to those they would experience working for you. Use our reference check form as a guide in developing your own set of questions.
   
   
4. Speak with former employers. The application form typically requests a list of about three references. In more cases than not, an applicant will provide personal references in addition to professional references. Since personal references are more likely to be biased and unlikely to provide any negative information about the candidate, ideal references are current or past supervisors. These individuals can attest, first-hand, to the candidate’s experience, skills, and overall performance.
   
   
5. Document reference responses. During the process, record the responses provided by references. It’s nearly impossible to recall how they answered specific questions once the conversation is over. Take notes along the way and store responses in the candidate’s folder along with his or her application, resume, and any other materials collected during the application process.
   
   
6. Be consistent. Be sure to ask all references the same set of questions. This will allow you to compare the references’ responses to one another. If large discrepancies exist, consider the source. It may be because a personal reference was overly positive, whereas a professional reference was more realistic. Always put more weight on a professional reference since these individuals know first-hand the strengths and weaknesses of the candidate.

The potential consequences that can result from not checking an applicant’s references can certainly be more costly than the time and resources needed to put into conducting them. A bad hire can result in thousands of dollars in turnover costs, not to mention the potential for employee theft, violence, and other serious repercussions that can come from hiring an applicant without putting them through the screening process. If you are apprehensive about executing the process yourself, HR411 can help; details regarding our Employment Verifications are provided in our Screening Center.