Employee referencing: Your expert guide
Guide
Why is employment referencing important?
Digital transformation has considerably evolved the recruitment process in the last few years, presenting HR teams with hiring challenges like never before. These new challenges come in addition to the existing challenges of cost, risk and maintaining a positive candidate experience.
Changing candidate behaviours and desires include wanting greater control of their data and heightened expectations of what digital platforms should do. At the same time, shifting regulations and legislation, alongside a competitive job market, mean companies need to make faster, more efficient hiring decisions to secure top talent. But how can you achieve this with traditional methods that are often time-consuming and resource-intensive?
Ultimately, this evolution has created a necessary yet interesting shift in employee referencing and the processes needed to provide efficient and comprehensive checks. Different employers take different approaches and solve the risk associated with a candidate’s previous employment history in different ways. No universal standards exist, and HR policies are becoming increasingly industry-specific. Add to this the fact that our ever-evolving digital world is continually raising candidate expectations, and it becomes clear that a bespoke referencing approach is necessary.
What is employee referencing?
Employee referencing is a safeguarding and risk-mitigation process that employers use to verify a job candidate’s suitability, experience and occupational history. A company’s HR department usually undertakes employee referencing as a vital part of the recruitment process. It involves contacting a candidate’s previous employers to confirm their job history and behaviours where appropriate.
Several legal considerations are involved in this process from both a candidate and industry-specific perspective. As with any project that involves collecting and processing personal data, GDPR should be a key consideration. Candidates must be kept aware of what data is being collected and why, making data minimisation important.
Moreover, the right candidate information must be gathered according to the relevant industry requirements. For example, those seeking a job in healthcare and working with vulnerable patients will require different verifications and background checks compared to those applying to work in a law firm or bank.
When it comes to employee referencing, there’s a lot to consider. Even with an experienced HR team in-house, many companies choose to outsource this part of their recruitment. Expert help in this area can support a timely and accurate hiring process that meets the evolving expectations of the recruitment landscape.
Why do employment references matter?
Collecting employment references is a vital part of the hiring process. It verifies a candidate’s job history and qualifications, helping companies avoid risky hires and comply with various regulators. When done effectively, it can also streamline the hiring process and ensure an organisation secures top talent within a reasonable timeframe.
Key takeaway
Employee referencing is an essential part of the hiring process to verify a candidate’s suitability, job history, and skills. The changing recruitment landscape has necessitated a bespoke and digital process.
Common hiring challenges
When it comes to employee referencing, the world is continuously changing. With changing company objectives, business growth requirements, and industry standards, it can be challenging for organisations to know exactly what to check and why.
Before diving into the types of reference checks needed, let’s first explore the common hiring challenges HR teams face:
1. Industry-specific requirements
Industries such as education, healthcare, and financial services usually have significant safeguarding or regulatory considerations attached, meaning the hiring process must be strict and meticulous. There will also be adherence requirements to individual regulatory bodies like the Financial Conduct Authority (FCA) or Care Quality Commission (CQC).
2. Slow and inefficient processes
Employment referencing remains the slowest part of the hiring process and can delay the start of recruitment. Traditional or manual employee reference checks will always have their place in the recruitment process. However, they can typically take anywhere between 2 to 6 weeks. This timeframe understandably causes delays in the recruitment process. It could mean you miss out on a sought-after hire to a company that recruits more efficiently and faster.
Traditional checks also don’t necessarily provide consistent or reliable data and can require more time, resources, and cost to process, verify, and analyse. The challenge for HR Teams is the amount of time spent chasing references, which could potentially be spent on more value-added tasks.
3. The risk of fraud
Hiring someone with falsified information on their application can bring significant financial, legal, and reputational problems to your business. Common application fraud can range from exaggerating or fabricating qualifications (meaning they’re ill-equipped to do the job) to failing to disclose criminal convictions or using false documents to work in the UK illegally.
Key takeaway
HR teams face various recruitment challenges, from time-to-hire constraints to the risk of fraud. However, a dynamic employee referencing process and background-checking policy can help mitigate these challenges and free up time, cost, and internal resources. Additionally, where regulatory requirements don’t constrain you, looking at traditional versus data-led referencing can streamline your process.
What should you be checking for?
There is no ultimate due diligence checklist for companies to adhere to. Rather, your employment screening checks should encompass a blend of the following that best suit the needs of your company, the hiring role, and your industry’s regulations:
Industry regulations
- Right to Work and identity verification.
- Employment history that covers previous job titles, responsibilities, employment dates, and any gaps.
- Education information and qualifications, such as degrees, certifications, and professional licenses.
- Character references from former managers or colleagues that help give an understanding of a candidate’s work ethic and performance.
- A criminal background check to confirm that the individual is legally able to work in the chosen role (e.g., with children, sensitive information, or finances).
- A credit check to identify any potential risks associated with financial responsibilities is essential for roles within financial services and banking.
- Social media/online presence checks to help spot any red flags in inappropriate behaviour and ensure the individual aligns with your company’s brand.
For regulatory-specific checks, you need to consider the following screening requirements:
Screening requirements
- Are you FCA regulated?
- Does your staff require BPSS checks?
- Do you require BS7858 screening?
- Are you an Ofsted-regulated business?
- Do your contractors work for any businesses regulated by a particular body?
3 types of reference checks and their benefits
1. Data-led employment reference checks
With the recruitment landscape growing in complexity and fragmentation, a one-size-fits-all solution is no longer a viable option. A digital platform that is efficient and tailored to your company’s needs is essential.
Our data-led employment referencing solution transforms onboarding by leveraging best-in-class data alongside a consultative approach to streamline and automate every step. More than that, we put the candidate back in control of their information, giving them a powerfully positive brand experience from before day one.
How it works
This solution may be digital-first, but the secret to its success lies in our blended approach, using human curation where necessary to support any activities our data solution cannot validate. The platform will flag any check elements requiring a manual follow-up, ensuring full validation of the required reference period in the quickest time possible.
In short, this means you can mitigate the risks associated with hiring, make quick and informed onboarding decisions (reducing a 6-week turnaround to minutes in some cases), and support your regulatory compliance.
2. Semi-automated employment reference checks
Semi-automated referencing is a process that combines sophisticated workflows, such as automated emails to referees alongside manual chases from trained experts, to ensure the quickest replies to reference requests and support faster hiring decisions.
The process is a more traditional way to validate reference periods. It is supported by our large referee directory to ensure a right first-time contact point. Our experts can handle complex cases with multiple activities, covering gaps and evidence requests quickly.
Faster processing, supporting compliance, and the ability to handle a higher volume of reference checks are all benefits of semi-automated employment referencing.
3. Automated employment reference checks
Our automated employment reference checks put you, the employer, in control. Using our well-defined chase cycle process, you have the choice of combining data with our automated workflows to validate employment periods or contact previous employers directly. Our workflow gives you choice and flexibility and ensures that you are chasing references in the most efficient way. At each stage, you have full visibility of progress and the ability to upload documents or edit the chase.
This is the ideal solution for any company looking to improve the way it obtains employment reference checks, but does not want to outsource in full. Use our expert platform to service the checks yourself, ensuring a better candidate experience and quicker, consistent, more cost-effective approach to references.
Find out more about data-led employment referencing
Our data-led employment referencing solution blends transformative technology with an expert consultative approach. With it, you can benefit from a bespoke referencing process that aligns with your onboarding needs.
Benefits include:
Better candidate onboarding
Putting the candidate in control of their data and providing a competitive onboarding experience.
Quick decisions
Having the ability to make quick and informed hiring decisions.
Reduce time
Reducing your organisation’s verification times from weeks to minutes.
Best data
Using best-in-class data, including information from HMRC, open banking, and payroll sources.
More efficient
Reducing operational time and expense, alleviating the pressures your HR and hiring teams face.
Total control
Full ownership of the employment period, end-to-end.
Keen to learn more? Visit our employment reference checks solutions.
How can we help you?
Today’s fast-paced and ever-changing hiring landscape demands an efficient and customised approach to employment referencing. To help you recruit top talent quickly, there are different employment referencing solutions available to suit your company’s needs.
Pair these solutions with our expert guidance, and you can strike the right balance of support and automation for a competitive hiring process.
We know that a one-size-fits-all approach does not work for all types of employers in all sectors, so we take a balanced, consultative approach with a range of solutions to ensure we deliver what you want, right first time.
