• Justin Hein

Best Practices for Providing Employee Reference Checks

If the employer provides untruthful information during the reference check process, it could result in a multitude of potential claims against the employer – e.g. slander, interference with prospective business.

Factual Information Only is Not as Bright of a Line as One May Think

Most recommendations and best practice lists make the point that only factual and objective information about former employees should ever be disclosed. Position title(s), length of service, and a description of responsibilities is really the only amount of information you ever should feel obligated to communicate to a third party.

The difficulty lies in situations where a commitment has been made regarding providing a positive review for a former employee. Or, in a situation where the former employer has negative information about the employee being checked-on. Where does that line lie when obligated to provide these extra details?

Identify and Assign Responsibility

First and foremost, limit potential claims by ensuring consistency in how reference checks are provided. To do so, many employers designate a single individual (such as an HR representative) to handle all reference requests. Having a single person (preferably in the Human Resources Department, with Human Resources training, and access to/permission to access employee personnel records) serve in that role can ensure that a consistent message regarding factual information of the employment relationship between employer and all employees is communicated to the inquiring party.

In addition, you can more easily train and oversee a single person as they comply with best practices when it comes to serving as an employee reference check. They should be trained on how to provide references in accordance with company policy and federal, state, and local laws, which may have restrictions on the types of information that may be disclosed. Finally, it also ensures that controversies concerning references can be quickly addressed (e.g. employee without permission to serve as reference check would be identified, corrective action issued, and false reference updated/revised, etc.).

In such cases, supervisors and employees should be instructed to direct all reference inquiries to the designated individual. And that designated individual--and only that individual--should provide the reference.

Bans on Salary History

Traditionally, asking about an applicant's pay history has been a relatively common practice, but over the past few years several states (i.e. California) and local jurisdictions have enacted laws that prohibit employers from asking for this information.

Even in the absence of a specific ban on these types of requests, be sure to follow all applicable pay equity laws. For example, in some jurisdictions, prior pay cannot be used to justify pay differentials between men and women.

Best Practices

Below, please find some simple-to-implement best practices for providing the reference check (note, this information is provided to assist you to stay within the applicable legal boundaries when responding to reference inquiries):

  1. Ensure that the former employee authorized the reference check.

  2. Verify that the caller has a legitimate need for the information.

  3. Limit your remarks to the inquiry.  Reply only with descriptions of job performance examples.

  4. Exercise good judgment in determining what negative information should be volunteered when the reference seeker does not ask you specific questions related to an area of deficiency or poor work.  There are basically three different categories of negative information: (1) information that is not job-related, (2) information that is job-related but not critical to successful job performance, and (3) information that is critical to the performance of the job.

  5. Provide truthful information.

  6. When giving negative information, give specific facts without labeling them negative.

  7. Discuss both the positive and negative attributes of an individual.

  8. Do not be more candid with family, friends, or former colleagues than you would be with others.

  9. Document the name and title of the person with whom you spoke, the date of the conversation, and what job-related information was given or received.

Concluding Thoughts

Few employees set a goal of failing at work. Yet, employees do fail and companies and employees do part ways. Keep in mind when you are asked for a reference that every former employee deserves the opportunity to start over—no matter the terms on which they parted from your organization. By engaging in a little preventative medicine, you can not only protect your company from potential claims of liability, but also ensure that all of your former employees are given a fair shot at finding their next career.

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