Although most companies have high standards, they also are challenged by limited resources. In addition, they frequently need to move quickly when the time comes to make a hire. Yet each applicant and employee adds business and security risk. Performing background and reference checks on applicants and employees is an effective way to discover potential issues that could affect your business. To avoid legal risks (such as negative hire) and other workplace issues (decrease in morale/productivity if new hire not adequately qualified), consider the following.
Considerations When Reference Checking Applicants/Candidates
As part of the hiring process, you may need to conduct background and reference checks. Be sure to document each response about the candidate’s reliability, character, and work ethic. Unfortunately, checking references may be time-consuming and unsatisfactory, as many employers often refuse to provide more than job title, dates of employment, and salary history.
Make sure that you verify that the candidate’s reference checking permission signature is on your employment application before starting the interview. If it’s not, ask the candidate to sign the application before you check references. This is recommended as a precaution so employers are legally and ethically safe.
When Checking References of Applicants/Candidates
- Only ask job-related questions
- Do not ask anything of a third party you could not permissibly ask the applicant directly (could be grounds for discrimination claim)
- Follow up on neutral or ambiguous responses by the references
- Comply with the Fair Credit Reporting Act (“FCRA”) if using a third-party service
Utilizing Outside Agencies to Conduct Background Checks
Generally, the FCRA is applicable to employers who obtain background checks on employees or applicants through an outside third party service for a fee. Depending on your job requirements, background checks may involve a criminal record check, motor vehicle record check, credit check, education verification, and employment verification.
In this case, the FCRA requires employers who use these “consumer reports” to comply with several requirements, including: (1) Disclosure; (2) Authorization; (3) Pre-Adverse Action Letter; (4) Adverse Action Letter. You may need to seek legal counsel to ensure you are complying with the FCRA if you are using an outside agency to conduct background checks.
When to Check Candidate References
You may not want to check references until you are ready to make an offer of employment. Also, verify that the candidate’s reference checking permission signature is on your employment application before starting the interview. As with most human resource processes, a standard reference checking format is useful. You can easily compare candidates and ensure you are asking appropriate questions to make an educated decision before offering the job.
Don’t check references until you are ready to make an offer to a candidate. This saves staff time and demonstrates your respect for the candidate. After all, you don’t know whether his current employer or her favorite professor even know that he or she is looking for a new position. (It is preferable that candidates tell their employer, but realize this isn’t always possible, or even desirable.)
Click below for an easy way to get started on checking candidate references. You’ll be thankful you did!