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Reference checking is on the rise
February 3, 2005
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Alexandria, Va. -- Nearly 40 percent of HR professionals report that over the last three years they have increased the amount of time spent on reference checking for potential employees, according to the 2005 Reference Checking Survey released by the Society for Human Resource Management (SHRM).

Most organizations conduct reference and background checks as part of their screening process.  Seventy-three percent of survey respondents say that reference checking is somewhat or very effective in identifying poor performers.

"Being able to identify unqualified candidates during the recruiting process saves organizations time and money," says Susan R. Meisinger, SPHR, President and CEO of SHRM.  "Employees provide the competitive edge for a successful business, making it critically important for organizations to be able to recruit the right people.  With new technologies, reference and background checking has become easier to conduct and increasingly more important to organizations who want to get a complete picture of the job candidates they consider hiring."

Ninety-six percent of organizations conduct some kind of background or reference check.  Although much reference checking is conducted in-house, 52 percent of survey respondents report that their organization outsources at least part of their reference checking or verification.

Survey respondents report that reference checks have found inconsistencies in areas including certifications, eligibility to work in the United States, degrees conferred, schools attended, and malpractice or professional disciplinary action.  The most common inconsistencies -- found by about half of survey respondents -- are inconsistencies in dates of previous employment, criminal records, former job titles, and past salaries.

Organizations are responsible for checking the references of potential employees, but also are asked to provide reference information about former employees.  Due to a fear of liability, 54 percent of organizations have policies to not provide employee references.  Yet, 75 percent of HR professionals believe their organization would share more information about current and former employees if there were laws clearly protecting them from legal liability.

The survey was based on 345 responses from a random sample of SHRM members.

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