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Despite the recent changes in recruitment, reference checking remains to be an indispensable part of the hiring process. A thorough reference check allows businesses to verify the accuracy of information that candidates provide on their resumes and during interviews.
Traditional reference checking involves a time-consuming process of calling a candidate’s current or former coworkers or managers. Moreover, the information gathered from this method can be limited to the bare minimum, such as dates of employment and job titles.
This is where automated reference checking comes in. In this article, learn what automated reference checking is, how it differs from traditional reference checking, its benefits, limitations, and more.
What is Automated Reference Checking?
Simply put, automated reference checking is a software-powered alternative to the labor-intensive process of traditional reference checking. Through a web-based platform, recruiters and hiring send out a survey to a job seeker’s list of employment contacts.
When done right, these digital reference checks solve a number of hiring challenges. Primarily, it has the ability to gather useful insights about a candidate’s job experience, competencies, reason for resignation or termination, and workplace conduct.
Switching to Automated Reference Checks: 5 Key Benefits
In today’s highly competitive recruitment, switching from a manual reference check to an automated background check is a win-win situation for employers and job seekers.
Below are the 5 key benefits of automated reference checking.
1. Faster Hiring Process
Recruitment is the first and one of the most important components of a company’s talent lifecycle. Unfortunately, traditional reference checks can become bottlenecks, influenced heavily by the responsiveness and availability of the contacts provided.
Most of the time, they take several weeks to complete. In worst case scenarios, especially for urgent vacancies, a hiring manager may decide to forego this step for the sake of onboarding someone quickly.
Instead of conducting interviews over the phone one by one, a reference survey is sent out simultaneously. It eliminates the need for HR to call references one by one, which improves overall team productivity.
2. Data Driven Hiring Decisions Across More Hiring Stages
Given how labor-intensive it is, checking references of a potential next hire is usually done last. However, the data collected from a candidate’s employment references could be maximized during the earlier stages of the recruitment.
For example, a hiring manager can formulate specific questions that will allow a candidate to expound certain responses given by coworkers or clients.
Using an automated system to check references can generate comprehensive employment in a fraction of the time. This equips recruiters with more data that they can use to evaluate candidates and decide who the top talent for the role is.
3. Better Accuracy and Higher Volume of Responses
It is not uncommon for a recruiter to get filtered responses when interviewing references over the phone, as they may be hesitant to give negative feedback about a current or former colleague. This creates challenges for hiring managers who rely on complete and accurate employment information.
Automated reference checking solves this through anonymity. Most reference-checking service providers allow feedback to appear in their system anonymously, wherein responses cannot be traced back to specific contacts.
Knowing that their answer will be kept confidential can generate more responses and give hiring managers more insights to assess a candidate’s skills, aptitude, and behavior.
4. Standardized Approach
Over-the-phone interviews can be subjective, depending on who is conducting them. References rate candidates differently, creating a discrepancy in how candidates are scored.
Similarly, even if a company uses a template, there’s no guarantee of adherence to SOPs. For instance, if the person they’re interviewing is rushing, they may skip questions to shorten the conversation.
On the contrary, automated reference checks send out the same set of questions regardless of who the recruiter or hiring manager is. Since they are system-generated, all candidates are evaluated using the same set of criteria.
On top of these templated surveys, some automated reference-checking providers allow recruiters and hiring managers to customize a set of questions depending on the specific role that they want to hire.
5. Data Protection and Privacy
Whether it’s employment verification, criminal background screening, or drug and occupational health screening, no background check can be carried out without the outright consent of job seekers. Equally important is clarifying how their employment data will be collected, used, and managed.
In the United States, data collection should comply with the Fair Credit and Reporting Act (FCRA) and the Equal Employment Opportunity Commission (EEOC).
While this can be accomplished with traditional reference checks, automated reference checking platforms offer built-in features that clearly outline its terms and conditions. This includes prompts with boxes that candidates need to read and check before any reference check can proceed.
This does not only protect a company from potential legal complications that may lead to lawsuits and damage its reputation. It also safeguards the privacy and data security of job seekers.
Possible Limitations of Automated Reference Checks
While automated reference checking provides numerous benefits, HR leaders should remember the following limitations associated with these systems.
Lack of Interaction
The real-time nature of traditional reference checks allows recruiters to ask follow-up questions when needed. Unfortunately, current automated reference checks don’t offer this functionality. However, this can be solved by carefully formulating a list of questions before any reference check is performed.
Technical Challenges
Employers need to be prepared for any downtime when checking references using their chosen service provider. This includes performing thorough research, booking a demo, and getting an understanding of the system before subscribing to an automated reference-checking platform.
Automated Reference Checks: Hire Faster and Better
Overall, the benefits of automated reference checks still outweigh the limitations discussed above. Businesses can save time and money, fill vacant positions faster, and onboard the candidate who is most suitable for the role.
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FAQs About Automated Reference Checking
What do automated reference checks cover?
An automated reference check collects important information about an applicant’s job experience, job title, work tenure, reason for resignation or termination, records, behavior, and conduct. In some cases, this can be expanded by using a customized survey provided by the recruiter.
What’s the turnaround time for employment verification?
A full report is usually generated within 24 to 72 hours. However, with the existing high workforce turnover, the process can take up to a week. This is still faster compared to over-the-phone interviews with references.
Do automated reference checks follow laws and regulations?
It’s required for all pre-employment screenings to comply with the most up to date laws and regulations. It’s advisable to ask a provider how they meet FCRA and EEOC policies. Furthermore, all background checks need a candidate’s consent.
