Employee references: What's the value? By Annie Hayes

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Beating the cheats is big business these days with an estimated two-thirds of CVs carrying inaccuracies. Do employee references help or can they be as easily manipulated by those willing to embellish on their past experience, pay and job titles? Annie Hayes, HR Zone Editor reports.

Outdated?
‘Subject to satisfactory references’ is the final hurdle for most candidates who already have an offer in the pipeline but with applicants able to put forward their own selection of referees is their any value in pursuing what should is very often a done deal?

"Employers won’t learn the really ‘good stuff’ from verification letters but there is a value in verifying the basic factual elements – roughly two-thirds of CVs contain inaccuracies these range from the major to the minor from PAs that dress themselves up to MD status to minor CV gaps that can be easily explained."

Eyal Ben-Cohen, founder of Verifile.

Nik Kellingley, Training Consultant became so disillusioned with the reference checking process, whilst working as a hiring manager that he decided in the majority of cases not to pursue them:

“No-one is going to include a poor reference as part of their application, it doesn't make sense to do so. Written references can be filled in by anyone and who would know if the person actually was who they claimed to be? Verbal references are equally ropey, you phone a mobile number or a work number or a home number, and have no real way of confirming them as genuine or the individual you speak to as genuine.

“I have been a hiring manager for several years and the only time I have taken up a reference was when a candidate was so negative about his previous employer at interview that I began to wonder what had actually happened (happily the employer, someone who we knew well as they were in the same industry, confirmed that his story was true and that they were sorry to have seen him go).”

Employee references are increasingly moving towards a model where verifying the basic facts including dates of employment, job title, salary and reasons for termination is the only information that can be extracted. An increasingly litigious culture together with developments in the law has brought about this change – character references are few and far between and the Chartered Institute of Personnel and Development (CIPD) report that the level of response for reference requests can vary from anything between 35 to 85%.

Eyal Ben-Cohen, founder of Verifile, the CV verification and background screening service says that employers need to change their expectations of employee references.

“Employers won’t learn the really ‘good stuff’ from verification letters but there is a value in verifying the basic factual elements – roughly two-thirds of CVs contain inaccuracies these range from the major to the minor from PAs that dress themselves up to MD status to minor CV gaps that can be easily explained.”

But being in receipt of the facts, says Ben-Cohen makes it easier to make an assessment. “Would you employ a Financial Accountant for example after you’d discovered inaccuracies in their CV, if they failed to provide evidence of attention to detail and accuracy at this level, what’s the quality of their work going to be like?”

Inaccuracies and mistakes aside what about those that are prone to deliberate fibbing?

Little white-lies
Barry Rees, Director of People Programmes Ltd says it does matter because those that are prepared to embellish on a small scale maybe happy to do so on a larger one.

“However, while I would expect every candidate to sell themselves as much as possible, I would expect a good interviewer to be able to tell the difference between a candidate over selling their contribution or outright lying.”

Kellingley says that it depends on the job: “If you are looking for a brain surgeon then - yes. And any other role that involves public health and safety should be viewed in the same way. But for most other roles, the requirements from businesses are ridiculous, such as "Post Room Clerk required - must be a graduate", or "Administrator required for processing application forms - five years experience essential" and so on. This leaves employers pretty much inviting fraud from young enterprising people who can't meet an arbitrary requirement which has little to do with whether or not the person can actually do the job and everything to do with employers chasing ‘status’ over ‘substance’.”

Amount and type appear to be the key considerations from which employers will then decide whether to punish a liar once discovered.

Fitting punishment?
Most of our HR members agree that it depends on the severity of the fib. Pat Lomas, an HR Manager for a manufacturing group says it comes down to mutual trust and confidence:

“I have experienced a situation where an employee told us they had a degree when they did not. I approached the employee to ask them why they had given false information and followed up with a disciplinary interview. The employee resigned and refused to attend the disciplinary interview, which went ahead in their absence. The outcome - dismissal. The whole employment contract is based on mutual trust and confidence and our employee was therefore in breach of contract.”

"Where the lie has been in an area that was critical in the decision to give them the job, then dismissal is justified. However, I do think it is down to employers to satisfy themselves as to an employees credentials."

Barry Rees, Director of People Programmes Ltd.

Rees, took a more lenient line when the inaccuracy involved sick days:

“I once had a school leaver recruit who had stated on their application that they had not been off sick in the past twelve months, yet the school had recorded 42 days! When we hauled the person in to explain the discrepancy they were adamant that they had answered the question accurately, as they had not been off sick, they had been playing truant! We read them the riot act that such behaviour was not acceptable in the work environment and they kept their job (and went on to be very good).”

Rees also believes that the length of time that passes before the lie is uncovered has a bearing, together with its severity.

“Where the lie has been in an area that was critical in the decision to give them the job, then dismissal is justified. However, I do think it is down to employers to satisfy themselves as to an employees credentials.”

And Kellingley agrees: “It depends, if the person is doing the job well and the lie doesn't put you at risk of liability (such as no health & safety qualifications for railway engineers) then it needs to be discussed and maybe a warning given, but why fire someone who can do the job? It's why you hired them, not to show off their CV's.”

What can be done to stop the cheats slipping through the net?
" There are agencies who claim to be able to do thorough background checks but I'm pretty convinced that while they can show someone didn't work for "X employer" or didn't get "Y qualification" what they can't do is catch the lies of omission and they certainly can't make the most important decision for you - which is can the person do the job?"

Nik Kellingley, Training Consultant.

Rees says that employers must revisit every stage of their recruitment process to ensure that preventions are in place along the way.

“I don't think we can underestimate the importance of an organisation getting its recruitment and selection processes as fit for purpose as possible, with well trained interviewers who can funnel down to the detail.

“Follow this up with good performance management systems and measure employees by the only criteria that really matters at the end of the day, can they do the job to the satisfaction of the company?”

Kellingley backs this up and suggests that employers need to become far more adept at testing people’s skills and aptitudes during the recruitment phase and offering employment based on these, rather than relying on qualifications which he says has a wide variance in actual worth.

If all that fails, there are a plethora of vetting agencies on the market, growing daily, that can put candidates through their paces. Sue Beatt, Director of People Solutions (Scotland) Ltd has experienced the CV vetting companies at first hand:

“The last company I was with had contracts with many companies in the financial services sector so all employees had to go through a very robust vetting process which was done by an external company. The level of vetting was determined by the job level. Although employment references were taken up, the further level of vetting did give slightly more peace of mind.”

Ben-Cohen urges employers to protect themselves, kick-started with a review of all employment documents including ensuring offer letters are made subject to the receipt of ‘satisfactory references’.

But Kellingley believes that it boils down to more than what agencies like Verifile can offer:

“There are agencies who claim to be able to do thorough background checks but I'm pretty convinced that while they can show someone didn't work for "X employer" or didn't get "Y qualification" what they can't do is catch the lies of omission and they certainly can't make the most important decision for you - which is can the person do the job?”

This says Kellingley is at the heart of the matter – reference or no reference if a person can do the job employers should be happy and he says this is what the recruitment process should be built around not verification of factual data.

Do you agree? Post your comments on the box below and share your thoughts on this aspect of the hiring process.

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28th Sep 2006 18:58

I have posted on this topic already, but two things have happened to me since that may be of interest, if only to reinforce my earlier view?

First, I have been approached today by a public sector employer for a written reference on the daughter of a friend. The 'Person Spec' attached to this request misses most of the personal qualities I would seek in this recruitment for this post as the employer , and there has been no invitation for a more private discussion. My written answer will of course be as objective and helpful as possible - and I fear utterly worthless. (Actually, this candidate should meet their needs in spades as far as I can tell - and I probably wouldn't have been offered as a referee if there was any doubt about my views by the candidate! - but what an incredibly incompetent way of going about this??)

Second, and unusually, I recommended a specialist recruitment agency this week to a private sector client, who has a rather hard-to-find job to fill. The feedback I had from the recruiter was that about 7 years ago, this agency had offered a candidate whose qualifications were not accurate and the recruiter would be reluctant to use them again.

Excuse me?? As an employer myself, I want good candidates, and I rather warm to their historic truths even while focusing on their future potential. But to expect a recruitment agency (as opposed to a search consultant?) to check every single applicant's qualifications is surely bizarrely naive?

Forgive the rant! But may there not still be room for some more common-sense by employers in this very important area of recruitment, and perhaps even rather less room for off-loading the responsibility on to someone else?

Sincerely

Jeremy

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By hobsonf
12th Sep 2006 15:12

I agree about the importance of checking all the facts that affected your offer decision and the questions you asked at interview. Often ignored is salary (and especially bonuses). Most organisations will reflect current earnings into the starting position in the salary range. Thus, even if the person can do the job OK, a salary 'fib' can be highly damaging to internal harmony or even be the basis of an equal pay claim. The CIPD do not include current pay in the list of facts they suggest you check (and do not check that themselves). I think that is wrong advice.

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12th Sep 2006 18:25

So what happened to robust HR procedures then?

We have had a discussion on the CIPD communities about whether there are too many poor HR people about, my main bug bear is that the basics are often skimmed over or completely ignored when recruiting people. Basics are what you do in everything, these materialise as Standards therefore if you can't get the basics for recruitment right then obviously the standard of provision will be poor.

Too many see recruitment as an administrative chore which is where the problem lies. At one previous employer I had to work to extremely high standards, which included meeting applicants and checking documents particulary qualifications, therefore I was amazed to hear from a college tutor that in a previous HR job they had taken on some graduate trainees, nobody had bothered to check qualifications therefore on their second day they were all told to bring in their degrees, It then turned out that none actually had a degree at all and the company was left with either the option to dismiss or put the new employees on a A' level training scheme, the company choose the latter.

Remember the grilling that Ruth Badger got from those headhunters on the TV series 'The Apprentice' they did not believe what her CV said.

I do know of someone that asks candidates at interview if their P45 from their last emplyer will confirm their salary - he likes to see the look on their faces!

What concerns me is headlong rush into candiadate checking services, apart from financial services who may feel that a candidates credit history is worth looking at (My bank has just sent me a load of bumpf about how many thousands of people have incorrect credit histories and they don't know about it!) but everything else offered is what every Hr Department worth its salt should be doing. Just something else to chuck the department budget at.

If you dillute the HR function enough then it simply ceases to exsist with everything outsourced.

Finally one of those little stories that we can all learn from:

I remember years ago about the story of the woman who looked after the company payroll, who after an employee left continued to pay a salary into a bank account which she had control of, she didn't even take a holiday for fear of being found out, this went on for sometime and only came to light when she became ill and was off work sick. So who was to blame? bad management practices in this case, nobody in Management was checking and auditing the work being done. The employee had no previous record for dishonesty, it was just too easy and the temptation too great.

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12th Sep 2006 11:04

I think most employers find written references of very little value - and it concerns me that many in the public sector especially still seem to reply so heavily on them.

We always take up references privately and informally by telephone for critical posts before any appointment - with the candidate's permission of course. Doing so is a skill in its own right, of course it is time consuming and you do need to be able to read between the lines sometimes, but it is very rare that we don't manage to establish what we really need to know this way. Not the least, is the cv likely to be accurate, what are past employers' views on performance, strengths, development needs and even possible job fit, and would they be willing to employ the candidate again in the future?

Most past employers seem to be very happy to contribute such information informally, not least I think because they might well want the favour returning from other employers at some stage, as the recruiter. Also, we find very few employers who wouldn't want to see a past employee best-suited for their next job, whatever the circumstances of their leaving - save only perhaps those who are being hired by a competitor. (But that's another issue!)

Kind regards

Jeremy

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12th Sep 2006 12:45

References in general and written references in particular may have a limited value as most of the contributors to this article suggest as the information provided is often limited to dates / titles etc but even this has a psychological value as knowing that the facts will be checked keeps most candidates from over embelishing their claims.

More detailed references - especially those obtained by phone need careful interpretation - performance standards in one company may not be the same in another, fit to the organisation can be a critical factor in success and your organisation may be very different to theirs etc etc..

References are a useful tool in skilled hands but you can't take them at face value. If you don't use them you are missing an opportunity to maximise the effectiveness of your selection process and the cost of poor decisions can be very high.

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12th Sep 2006 14:33

Just to give a slightly different perspective; within the Care Sector (and maybe others that I don't know of) it is a requirement to have two references for all employees, one of which I believe MUST be the most recent employer. This is something that the Commission for Social Inspection may check when they audit a business.

In my view, in this case, it becomes a tool mostly to verify that someone is who they say they are (to a certain extent!), and that they have worked where they say they have worked - basic checking of facts.

It can be a real sticking point for us as the response rate for references is still pretty poor, and we spend a lot of time chasing for them, even in an industry where we are all bound by this requirement to have two references for all employees.

Sam

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