Reference checking myths: just how important are employee references?

When it comes to checking new employee references, many companies find themselves cutting corners and not carrying out checks as thoroughly as they perhaps should. With one in five candidates including misleading or false information on their CV, it’s vital that reference checking is prioritised to minimise the risk of candidate fraud.

There are a wide variety of rumours surrounding reference checking for both employers and employees, but the experts at reference checking software company IScreenYouScreen have the following facts to bust these long-held myths.

Myth number 1: Checking employee references doesn’t really matter

Hiring a candidate on the basis of their CV alone isn’t only dangerous for your company and clients, but can also cost your business dearly in financial terms. In fact, candidate fraud costs UK businesses an estimated £2 billion a year, which is a high price to pay for something which is easily preventable.

Although it may seem like a daunting task on the face of it, thorough reference checking will ultimately reduce staff turnover and therefore decrease recruitment costs, as candidates will be of a higher calibre and a better fit for the role. Hiring the right person for the job is essential for productivity purposes too, which will undoubtedly improve with rigorous reference checking.

Myth number 2: You cannot give a “bad” reference

While employers must be careful in legal terms when providing any reference, as long as the information is factually correct and does not give an unfair or misleading impression of the employee, they are able to give a negative reference. However, some employees have a policy not to provide a reference at all, or to simply state dates of employment rather than give a negative reference, which can cause alarm bells to ring for recruiters.

Myth number 3: Employees have the right to check their reference before it’s sent

Employers may keep previous candidates in the loop by sending a copy of the reference given, however this isn’t common practice. Employees are within their rights to ask for a copy, however there is no obligation for a company to provide this. However, once the candidate has been successfully employed by a new company, they have the right to see the reference given under the Data Protection Act, should they wish to.

Myth number 4: Reference checking should be the last step in the hiring process

Many employers see reference checking as an afterthought once all other steps are in place, however it’s vital to remember that these checks are designed to create the bridge between the hiring and onboarding process. Checking of references before a candidate is officially hired will prevent a great deal of time and aggravation further down the line, if they do happen to be a dishonest candidate.