Reference Checking Approaches: Is it Time to Blow Yours up?

Reference checking of candidates is conducted by nearly every firm in the Untied States. Some firms conduct them internally, while others outsource the process. Unfortunately, both approaches are often executed with little concern for accuracy or effectiveness.

In fact, it is not uncommon for reference checks to be completed by recruiting coordinators with little subject-matter expertise, using a generic set of questions that offer little in the form of insight into a candidate’s actual past job-related performance.

The bulk of today’s approaches and processes exist for no other reason than to offer an out to the human resources function in case of a critical incident involving an employee.

In a fast-changing world, quality reference-checking approaches are becoming more important due to:

  • Business demand for assessment processes that help ensure candidates are not being screened out due to personality conflicts or out-of-the-box thinking. In modern enterprises, innovation is job one and that requires diversity of thought, not homogeneity. Reference-checking systems can offer insight into a candidate’s ability to complete the work regardless of organizational fit.
  • The growing dispersion of the labor force requires that organizations be able to adequately assess candidates who may not be as readily available for traditional face-to-face assessment approaches.
  • New legislation regarding privacy around the world requires processes that are more tightly controlled, documented, and geographically centric.
  • As the world’s labor population becomes more visible to employers and the demand for scarce labor increases, managing processes to create or build a relationship with possible candidates in the form of references will be critical. For example, how you conduct a reference offers insight into how your organizations values talent. What message does your current approach send?
  • Reference-checking processes can offer insight into a candidate’s normal behaviors, as opposed to those that might emerge under the stress of other assessment approaches.

While reference-checking approaches will never be as valid as say, content valid simulations when it comes to predicting employee productivity, it is important that organizations attempt to make their processes as valid as possible.

Unfortunately, I can count on one hand the number of organizations that have implemented a process for validating their reference-checking approach. I realize that doing so would expose the organization to liability if they opted not to correct a process that could not be validated, but would your organization honestly accept the notion of not testing the quality of their product?

This is a bad situation, and one that has gotten even worse as HR functions have become laser-focused on pursing incremental efficiency in transactions without regard for effectiveness. It would not surprise me to find that the accuracy of reference checks in predicting performance is somewhere in the single digits for most enterprises.

If you want to stop assuming that yours works, review this list of common problems with a majority of corporate-run processes.

Article Continues Below

Inaccurate Results

Here are some common reasons why reference-checking results may be misleading:

  • Applicants select references who they feel will give positive feedback.
  • Applicants often “coach” their references to say the right things.
  • Innovators and out-of-the-box thinkers are often screened out because their references provide stories and examples of behaviors that do not fit the norm or desired profile.
  • The reduced tenure of talent in many modern organizations can make it difficult for candidates to stay connected with those individuals who were in a position to truly observe their performance.
  • Often, under-trained employees conducting reference checks “prompt” references for positive comments through the language they use.
  • References may have hidden agendas that cloud their objectivity. For example, professors may want to help a student get a job because schools are ranked based on their ability to place students, or a current manager could lie in an effort to offload a weak employee or to keep a good one longer.
  • Unless you take pictures or fingerprints, you have no way of knowing whether the applicant is the same person you are investigating. There are numerous documented cases where people fraudulently use someone else’s “name” to get a job.
  • Even simplified references like “dates of employment” can often be inaccurate because of bad recordkeeping or the fact that the individual shifted jobs many times within the corporation. Discrepancies and titles can also lead to candidate rejection even though the title mix-up is due to recordkeeping errors.
  • Reference checkers seldom ask for actual performance data or performance appraisal summaries, instead relying on personality and behavior traits. Granted, many firms would be reluctant to give actual performance data to a reference checker.

Metrics and Measurement

Here are some common measurement errors in reference checking:

  • They are not given a quantified “score” so that comparisons are easy and a clear delineation between a positive or negative reference is clearly defined.
  • There is no feedback system from performance management to see whether new hires who had performance issues also had lower reference scores.

Process Errors

Here are some common process or administrative errors in reference checking:

  • No one “owns” the overall process and is personally accountable for high-quality six sigma type execution.
  • In many organizations, a junior person is assigned the reference-checking task.
  • Hiring managers and recruiters are often not trained in the reference-checking process.
  • The same process and scoring is used for all jobs classes (auditor references may be more important than janitor references) and reference questions are not changed based on the skill and experience requirements of each unique job category.
  • They are not recorded, so you have no record of what has actually been asked or what has been said, so the person could deny it later if legal action occurs after employment is denied due to references (references, like any selection tool, must be valid and reliable).
  • The reference volunteers personal or illegal information and there is no evidence that it was not used in the hiring decision.
  • “Personal” references are requested and then checked (which are generally not job-related and may be illegal). Personal references are self-selected, so they generally turn up no negative information.
  • The expense, language, and time zone differences may mean that out-of-state or international references are not checked at all.
  • Reference checkers have no way of knowing whether the individual they are talking with actually has any direct knowledge of the individual’s performance. Errors occur when the individual supervisor is unavailable and someone else volunteers to “fill in” and do the reference from memory (in fact, almost all references that are done outside of HR are done from memory, without referring to the actual employee file).
  • Reference questionnaires seldom individually weight the questions to make sure that the factors with the highest correlation get the highest weight in the reference assessment.
  • Some references are done “ad hoc,” without standardized questions.
  • Individuals in “protected” groups may statistically have higher “weak reference” scores, which could result in some adverse impacts and legal issues (especially credit checks and criminal record checks).
  • There is a variation in the accuracy of reference checking (different answers are often obtained when HR does reference checks than when managers do them.
  • Some references are checked without the signed permission of the applicant (the permission request and signature is always present on a paper application form but it does not accompany unsolicited resumes or even most online resumes submission systems).
  • Most reference checking systems are paper-based, and there is no electronic record available to other recruiters and hiring managers that allows them access to past results.
  • References are often considered “pass fail” and are not weighted with other parts of the selection criteria.
  • References are done just once, at the time of hire. However, they are never updated during employment, when it is possible an employee could have committed some criminal offense outside of work.
  • Over 90% of all references are positive, so why bother?
  • There is no evidence that the “would you rehire them?” question has any accuracy.
  • The checking of references is often done too early in the screening process (for all applicants) rather than just for the finalists, thus wasting a lot of money.
  • “Old” references (past three years) may be given the same weight in the hiring decision as current jobs, which would be an error.
  • Hiring people contingent on successful reference checking might seem like a good idea, but even when issues are raised later on, the individual is seldom discharged. Often, managers don’t want to go through the hiring process again.
  • Doing reference checks via e-mail can have advantages, but it’s harder to establish the identity of the person you are contacting.
  • Many reference-checking systems rely on the phone numbers given to them by the applicant. This can result in serious fraud (always obtain the phone numbers yourself).
  • Outgoing reference checks are seldom assessed or monitored either, so they too can have negative consequences and high liabilities.
  • Reference-check systems seldom determine the appropriate “right and wrong” answers in advance, so the interpretation as to whether the information results in a positive reference is subjective.
  • Most exit-interview processes fail to get the exiting employee’s permission to give a future reference. In addition, managers seldom put together reference information at the time of termination, when it is most likely to be accurate.
  • Many reference-check systems immediately reject a candidate once negative information is found, without contacting the candidate and giving them a chance to justify the discrepancy.
  • Because responding to references isn’t a high priority, phone calls from references may take a long time before they are returned.

Four Must-Do Steps

Here are some critical things you must do to have a world-class reference-checking system:

  1. Use “mystery shoppers” to act as references in order to determine whether the person checking the references does it precisely as the process requires. If you hire an external vendor, also check their work periodically.
  2. Regularly measure the correlation between reference checking scores and on-the-job performance appraisal scores.
  3. Focus your efforts on jobs where public safety and theft are real possibilities.
  4. Look at external reference-checking vendors because there are specialists in this narrow area.


It’s a fact that most reference-checking systems are weak at best. They emphasize the positive, but they seldom result in accurate or reliable reference information. Regardless, most corporations still do them, mostly because of the fear of repercussions when an employee causes problems. Should you opt to do them, develop an approach that minimizes the errors and maximizes the accuracy of information obtained.

I bring this topic up because many corporations that I work with are seeking to hire more innovators and outside-the-box thinkers. Unfortunately, screening out such individuals is the biggest failing of reference-checking approaches. If your application screening, reference checking, and interviewing processes do not have specific design elements to prevent the premature elimination of outside-the-box thinkers, realize that you are dramatically hurting the bottom line of your company.

Dr. John Sullivan, professor, author, corporate speaker, and advisor, is an internationally known HR thought-leader from the Silicon Valley who specializes in providing bold and high-business-impact talent management solutions.

He’s a prolific author with over 900 articles and 10 books covering all areas of talent management. He has written over a dozen white papers, conducted over 50 webinars, dozens of workshops, and he has been featured in over 35 videos. He is an engaging corporate speaker who has excited audiences at over 300 corporations/ organizations in 30 countries on all six continents. His ideas have appeared in every major business source including the Wall Street Journal, Fortune, BusinessWeek, Fast Company, CFO, Inc., NY Times, SmartMoney, USA Today, HBR, and the Financial Times. In addition, he writes for the WSJ Experts column. He has been interviewed on CNN and the CBS and ABC nightly news, NPR, as well many local TV and radio outlets. Fast Company called him the "Michael Jordan of Hiring," called him “the father of HR metrics,” and SHRM called him “One of the industry's most respected strategists." He was selected among HR’s “Top 10 Leading Thinkers” and he was ranked No. 8 among the top 25 online influencers in talent management. He served as the Chief Talent Officer of Agilent Technologies, the HP spinoff with 43,000 employees, and he was the CEO of the Business Development Center, a minority business consulting firm in Bakersfield, California. He is currently a Professor of Management at San Francisco State (1982 – present). His articles can be found all over the Internet and on his popular website and on He lives in Pacifica, California.



21 Comments on “Reference Checking Approaches: Is it Time to Blow Yours up?

  1. I could not ask for a better argument for my personal theory that reference checking is one of the most frustrating and worthless aspects of the candidate screening and hiring process. Let’s face it, reference checking is a mechanism with really one goal and one purpose…if and when the wonderful candidate you have chosen (backed by no negative references) turns into the devil and runs amok or afoul, you can show you did due diligence. I don’t know one hiring authority (at least a smart one) who stands up and says, ‘I hired this person due to his wonderful references’. Because that may come back to haunt you in the end. Reading the article had me breathlessly awaiting the solution after a long list of outstanding articulation of where reference checking goes wrong, but at article’s end I realized that not even the great ‘Oz’, (Dr. Sullivan) held the total solution in his black bag.

  2. And yes, the weather has dropped to the 20’s in Some areas.. So, as I write this I wonder is this the reason that I am actually going to write the following 😉 –

    Doctor Sullivan that was an excellent article, and right on the Nose, Congrats.
    Too many companies don’t put enough, and sometimes way too much emphasis on Background checking.

    Background checking can reduce and even eliminate legal, financial and risk associated with poor hires, and the cost in having to fire those individuals.

    Sometimes though, as was mentioned, employers may put too much emphasis on those same checks, by not focusing on Criteria that is important to the position, but will instead become focused on emotional, personal and subjective criteria knocking excellent candidates out of the loop.

    One of the problems from implementing these tactics is that it opens the door for unfair treatment; Employers not treating candidates fairly and equally, by performing the same processes across the board will open the doors for potential liability. So it is extremely important to implement good judgment when performing background checks, and having Consistent Standards within any company.

    Great Article Dr. Sullivan. Hope to see more like this in the future.

    Karen M.

  3. We use SkillSurvey ( for all of our clients (as well as our own hiring) and it has been a great solution for us. It provides a web-based survey and reporting of references, and asks questions specific to the type of position hired. The system then consolidates the data collected into an anonymous report, with ratings for different criteria and comments on strengths and weaknesses. If you still want to follow up in person, you have the references’ contact information available to you. Great data, easy to use, legally sound — worth a look for those of you that need a better way to check references.


  4. Deborah
    Reference checking can go bad in so many ways — First off one of the worst things can happen in a poor reference check is information that may be unearthed can be about the Wrong person. As what happened with Vanguard Group and James Gorman, who ultimately sued to clear his name.

    Sometimes Identity theft can create problems as well ? if a person has issues with ID theft, and are unaware, then in a job search, when a company does a background check and see this bad credit, and the job requires that they must handle money, well it can be difficult to prove, hey, that wasn?t me who harmed my credit.

    When companies don?t rely on companies to do background searches, the companies who don?t adhere to legal and compliant standards, the opposite can happen as well. A person with a federal criminal background may also now come up as clean. Now you may have a facility Manger who has been a Chester Molester working at schools, as a teacher, or as a service technician going into homes..

    The biggest problem that arises may not gaining accurate information regarding background. Candidates have been known to lie about education, ability, tenure, and where they worked. Can you imagine having a Professional Engineer signing off on Documents and finding out later that they were not really a professional engineer? Their information was illegitimate? Or that the person handling finances for your clients had been arrested for ID Theft, fraud or embezzlement?

    The University of Maryland did a study recently on the Hundreds of Companies who are advertising their background checking.. They enlisted a background check company to conduct search on the 120 parolees and probationers that were part of the study, to see whether any additional arrests would appear on their records.
    Sixty-four of the 120 convicted criminals in the study came back with spotless criminal histories. The company they used was considered one of the better in the industry, not one of the national 9.95 searches.. so it is really important to check out your background checker and make sure that they really are applying to legal standards as well. Even the best companies’ reports contain errors. Criminals look innocent, or the innocent look criminal.
    The most important thing that We must remember is that the FCRA ? Fair Credit Reporting Act clears loudly that before the company makes an adverse decision in deciding NOT to hire the candidate due to information found on a background check, that the candidate must be informed and allowed to dispute the information.
    And make sure that the information you are Checking REALLY is going to be geared to the Job Description, or the duties performed. If a person has filed for bankruptcy, or has a criminal record, but it doesn?t pertain to the duties at hand, then ask yourself, is it really important? How old was the record, have they since proven to be model citizens? Is this person?s past going to really affect what they do today. Set standards, and have a solid job description and more importantly remember what you do with one person, you should be doing with all.

  5. I agree with Deborah that no intelligent hiring manager will hire someone because of a good reference. And I am also assuming that most candidates do check thoroughly with their references to be ascertain whether they do, in fact, believe that the candidate could excel in this specific job and exceed its requirements.
    However, sometimes interesting things do appear in the course of careful and through questioning of references.
    We once had 2 leading and excellent candidates to head a biotech. Each had been very successful in their former positions, had the requisite educational background, etc. During a conversation with a reference for Candidate A, we were told that, upon additional reflection, this person really did not have in depth experience integrating divisions (which was needed) and, while a superb manager, did not scratch deeply below the surface for answers nor possess strong scientific curiousity (this was for a biotech!) We went back and re-questioned the other references and this was confirmed by others. This factor emerged after more than 90 minutes of conversation and gave us considerable pause.
    Reference checking can still be very useful!

  6. Just an interesting story.

    On a $125k Controller position 7 years ago, the candidate gave me 24 (!) references. I got ahold of, and did a thorough interview with 21 of them. An offer $130k was made, that was not planned, on the bases of these, more than what the candidate wanted. But, alas, he took a lesser offer on a start-up that didn’t work out, and was 2 weeks later offering to take it at $100k. They declined. Oh well. Jon

  7. I agree- reference checks are just one peice in a candidate’s puzzle. I look for patterns in reference checks. If all people called say that your candidate posesses the same qualities, it gives you some indication of them as a person. I also try and find people that are not on the candidate’s reference list that may have worked with the candidate- somethimes what they won’t say is just as important as what they will!

  8. Deborah
    The FCRA considers them the same. A bad or illegal reference can lead just to as much problems.

  9. I have been recruiting for over 25 years; I am pretty old, cute, but old. I am great at it, in some markets considered to be a power broker. As good as I am at recruiting I am better at reference checking.

    Reference checking is an art form, armed with laws; real laws that put you and your clients at risk for legation. You must know the law here, it can and will hurt you. You can get an outside firm to do this but they can miss the boat as well. There are 5 forms of Identification, a lot to help ID Thefts get rich; it is a 14 billion dollar market, caution, outside firms can get the wrong information as well. The question will always be asked who placed the person you or the outside firm?

    Most companies don?t interview candidates well and are even worse at reference checking, some recruiters fall into that bracket as well. There is an effective and legal way to do this, it starts with the resume. I am sure you know you must get the candidate to sing a refinance and background check release, every one of them; part of agreeing to work with you a candidate a must sign a release. All resumes must have a disclosure on the bottom of each page.

    With the American Association of Personal executives have stated; that 67% of all resumes on the market are falsified in one form or another, it starts with the resume. Reference checking takes time and a PI attitude to do it justice; it also justifies a full fee.

    This is a subject I train clients with and teach to other recruiters. I would be happy to share information, not war stories.

    I wish you a life to be proud of, Barbara Jones, President and CEO— APB Global Services, LLC or 214-228-9717 PST

  10. Hi:

    Just to clarify, the Fair Credit Reporting Act (‘FCRA’) does not cover reference checks when they are conducted by the prospective employer. Only when an employer retains a consumer reporting agency to conduct such checks do they fall within the purview of the FCRA.

    I trust this information is helpful.

  11. David,
    can we talk about your comment? Was reading some letters re the FTC regarding this.. and I even called the FTC on this one.. Of course more ambiguity from them.. I quote, read the letters, then they also say, 10 lawyers from the FTC will have 10 different opinions..

    Anyways, based upon the ambiguity.. ‘Under Section 603(o) provides special procedures for reference checking; otherwise, checking references may constitute an investigative consumer report subject to additional FCRA requirements’

    Then under Section 603(d)(1) of the FCRA defines a ‘consumer report’ to include information that is ‘used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer’s eligibility’ for the purposes listed in Section 603 and Section 604. The purposes for which information may be obtained under Section 603 and Section 604 include credit, insurance, and employment-related purposes, and business transactions initiated by the consumer
    An ‘investigative consumer report’ is defined as a consumer report or portion thereof in which information on a consumer’s character, general reputation, personal characteristics, or mode of living is obtained through personal interviews with neighbors, friends, or associates of the consumer reported on or with others with whom he is acquainted or who may have knowledge concerning any such items of information

    Now, when we go further on the letter mentions You cannot get consumer reports unless you’ve notified the employees that you may obtain reports and have their written permission. If the employees gave you written permission in the past, you need only make sure that the employees receive or have received a ‘separate-document’ notice that you may obtain reports during the course of their employment and you must notify the employees and get their written permission before you get their reports

    Now I also read that this may be based upon information gathered and if it is Adverse information.. ‘explained that the staff of the Commission does not consider graduation dates, college degrees, or dates of employment to be items of ‘adverse information.’ dates of employment and educational data (such as dates of graduation and degrees) are neither ‘positive’ nor ‘negative.’ We believe that facially neutral information should not be considered ‘adverse’ information because a consumer may have misrepresented the information’

    It continues with Section 604(b) of the FCRA applies to employers who procure consumer reports for employment purposes. Section 604(b)(2)(A) requires them to provide a clear and conspicuous disclosure in writing to the consumer before a consumer report is obtained; under the terms of this section, this disclosure is required to be ‘in a document that consists solely of the disclosure, that a consumer report may be obtained for employment purposes.’ Section 604(b)(2)(B) re-quires that the employer obtain the consumer’s written authorization before procuring the report. While Section 604(b)(2)(A) states that the required disclosure that a consumer report may be obtained is to be made in a document that consists solely of the disclosure, we believe that the drafters did not intend to say that a disclosure statement should exclude the written authorization for procurement of a report required by Section 604(b)(2)(B). Rather, we believe that it was the intent of the drafters to assure that the required disclosure appear conspicuously in a document unencumbered by any other information.

    So, my confusion, as it seems also the Confusion of the FTC.. does this not then mean that a reference can be considered an investigative consumer report that has adverse information, and thus the employer can be held accountable.. not only third parties?
    And of course the Employer MUST have Permission prior to checking those references, unless they are based upon if the information gathered would have potential for adverse information?
    And of course applicants are entitled to a pre-adverse action disclosure and an adverse action notice ? In other words be told that they aren?t going to be hired because of what was discovered?
    Or am I misreading this information..

  12. Hi:
    You mention many requirements that are imperative when using a consumer reporting agency to procure such things as credit, references, motor vehicle and criminal information. However, these provisions do not apply when the employer is conducting its own reference checks. If you check the definition section of the Fair Credit Reporting Act (‘FCRA’) this will be apparent. Also, while the FTC contacts can periodically be hesitant to opine on a matter, this is one area which they would not be hesitant to indicate that without the use of a consumer reporting agency, the FCRA provisions don’t apply.

    I trust this is helpful.

  13. Thanks, yes!

    Read the full 86 Pages of the document.. and what really got to me about this is how messed up it is in it’s own way.

    A company can take a risk in Not using an outside agency, and have problems that may arise from poor background checking.. Also poor use of Manpower and such like.

    Yet, if they use an agency for an internal investigation, they have to tell the individuals hey, we are investigating you.. sign off..

    It is almost like a lose lose situation. It is almost better to hire your own internal investigator, but then, again, here still can come internal legal risks..

    Catch 22

  14. Karen and All –
    Reference checking that is done by recruiters is specifically exempted from the rules and regs of the FCRA – NAPS was instrumental in having that change made to the regs years ago. One reason was to ensure that the hiring process would not be held up. Recruiters must supply the substance of the reference check information -in the same manner in which it was gathered (in writing, verbal, electronic) IF REQUESTED by the candidate.
    Third party firms that do reference checking are a different story.
    And all reference checking is handled far differently from BACKGROUND CHECKS. That is where the consumer has the right to dispute the information, and stop a process (like a loan) until the dispute is cleared.

  15. Actually Dotty,
    I wish that was the case, but not so.. the FTC clearly outlines employment agencies. Naps Attempted to do it, and there are some exemptions or exclusiong that may be considered an Investigative Consumer Report and it is best to contact FTC on this one.

    Investigative Consumer Reports are anything that discloses character, general reputation, personal characteristics, or mode of living’ of the consumer being considered for employment

    Page 25 of the NAPS CPC study Guide clearly defines that

    Q. Why was the Fair Credit Reporting Act enacted?
    A. Complaints because of why credit was denied and not knowing why or because of
    inaccurate reports of credit reporting agencies.

    Q. When does the act apply to employment agencies?
    A. When the agency checks the references of an applicant or candidate in order to determine
    the eligibility of that person for referral to employers for employment.

    Q. Why?
    A. Consultants who engage in reference checking are engaged in the complication of an
    investigative consumer report. Any written, oral, or other communication of any information by
    the consumer reporting agency bearing on a consumer?s credit worthiness, credit standing,
    credit capacity, character, general reputation, personal characteristics, or mode of living which is used in whole or in part as a factor in establishing eligibility for employment purposes.

    Q. Does the placement firm have to gain the permission of the candidate in order to do a
    reference check?
    A. The candidate must consent orally or in writing to the nature and scope of the communication before a reference check is conducted, and if the consent is granted orally, the placement firm must provide written confirmation of that consent within three business days after consent is

    Q. What information about any reference check is the candidate entitled to have?
    A. The placement firm must, within five business days after receiving any request from a
    candidate, disclose in writing the nature and substance of all information in the candidate?s file. The sources of the information need not be disclosed.

    Q. How has the act been changed by recent legislation?
    A. From a placement perspective, the most important differences are the following:
    Personnel consultants must now obtain the candidate?s permission to conduct reference checks
    and communicate with prospective candidates regarding its results.
    Previously, no disclosure should to be made to the candidate until three days after the reference
    check was conducted. Now, the candidate?s consent must now be obtained before the
    recruiting firms conducts a reference check, even though that consent may be confirmed in
    writing as late as three business days following the date upon which the consent was obtained.
    While candidates have always had the right to request the nature and substance of the
    information contained in the reference check, previously that information has to be provided to
    the candidate in the same manner in which it was requested. Now, the information must be
    provided in written form and within five days after it is requested.

    Q. Under what circumstances can certain information not be conveyed to third parties:
    A. If the salary will not be over 75K the following information may not be disclosed:
    Bankruptcy actions more than 10 years before the reference check. None of the following if
    occurred more than seven years before the date of the reference check: 1) suits, 2) judgments,
    3) paid tax liens, 4) accounts placed for collection, 5) arrest, indictment and conviction records and 6) Other adverse information over seven years prior to reference check.

  16. An adenment to my previous post, the FCRA also made even further changes Fair and Accurate Credit Transactions Act of 2003 that amended the FCRA, and it seems to include employment agencies.

    I’m not an attorney, but based upon what I have read so far, I believe it is a fair suggestion that all recruiters do as Barbara suggests, get WRITTEN permission before doing ANY checking on a candidate, and that should include referencing checks, as sometims a reference check may ultiimately turn into a background check (investigative consumer report) as the conversation may turn to more personal characteristics.

    Make sure there is a disclosure release on the document – meaning if the candidate asks that you will release the information to the candidate, and SAVE that information for a period of at least 1 Year.. re the New FCRA Ammendment.

  17. An adenment to my previous post, the FCRA also made even further changes Fair and Accurate Credit Transactions Act of 2003 that amended the FCRA, and it seems to include employment agencies.

    I’m not an attorney, but based upon what I have read so far, I believe it is a fair suggestion that all recruiters do as Barbara suggests, get WRITTEN permission before doing ANY checking on a candidate, and that should include referencing checks, as sometims a reference check may ultiimately turn into a background check (investigative consumer report) as the conversation may turn to more personal characteristics.

    Make sure there is a disclosure release on the document – meaning if the candidate asks that you will release the information to the candidate, and SAVE that information for a period of at least 1 Year.. re the New FCRA Ammendment.

  18. Dotty, thank you for making that statement and clearing up some questions that may have given ?us? the wrong impression of what we can do in our practices. As recruiters reference checking is one of the ways we can justify and earn a full fee. It is one of the best new business development tools we have if we do it correctly and yes ethically.

    As I stated in my post on 01/17/07 there is an effective and legal way to do this, it starts with the resume. I am sure you know you must get the candidate to sign a refinance and background check release, every one of them; part of you agreeing to work with a candidate, they must sign a release. All resumes must have a disclosure on the bottom of each page.

    Reference checks are part of my daily plan, usually after lunch, they are the easies part of the day.

    I wish you a life to be proud of, Barb Jones, President and CEO— APB Global Services, LLC or 214-228-9717 PST

  19. Hi:

    One final comment regarding this matter. According to the FTC, ‘Applicants are often asked to give references. Whether verifying such references is covered by the FCRA [like criminal background checks, motor vehicle checks,etc. that are procured by a consumer reporting agency] depends on who does the verification. A reference verified by an employer is not covered by the Act; a reference verified by an employment or reference checking agency (or other consumer reporting agency) is covered.’ From a recruiter’s standpoint, I would focus on the exclusionary language and requirements set forth in Section 603(o)of the Act.

    I trust this further information is helpful.

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