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Reference Checking for Employment

Published April 2, 2024 (last updated on April 2, 2024) | Adam Wyatt - Copywriter and Content Creator

A man at a desk on the phone doing a reference check and making notes

For New Zealand employers, employment reference checking is a pivotal step in the recruitment process. It not only validates a candidate's credentials and work history, but also offers deeper insights into their work ethic, skills, and suitability for the role.  

This guide will walk you through the nuances of pre-employment reference checks so you can make informed hiring decisions. 

What is a reference check? 

A reference or background check involves contacting a job applicant's former employers, supervisors, colleagues, or schools to gather information about their performance, behaviour, general work demeanour and academic record. Pre-employment reference checks are a critical procedure that goes beyond the insights provided by resumes and interviews, offering a third-party perspective on the candidate's professional conduct and achievements. 

Why reference checks matter for New Zealand SMEs 

As an employer, investing time and resources to conduct reference checks yields significant benefits for your business: 

Reduced hiring risks  

Verifying a candidate via background checks minimises the chances of hiring someone who misrepresented their qualifications or work history in their application or resume. For your business, this can save time and money and the disruption of onboarding the wrong person. 

Improved team culture  

Hiring individuals who align with your company values and work ethic creates a more positive and productive team environment. As a hiring manager, reference checks can shed light on a candidate's teamwork abilities, communication style and overall cultural fit. 

Enhanced decision-making 

By speaking with past employers and colleagues, you gain valuable insights into a potential candidate's performance, strengths, and weaknesses.  

Increased employee retention 

Employee reference checks assist with hiring the right person from the outset, reducing the likelihood of early turnover. As a hiring manager. effective reference checks can help you identify individuals who are likely to stay with your company for the long term. Minimising the need of repeating the costly and time-consuming hiring process all over again. 

When to conduct a reference check 

Debates often arise around whether to conduct employee reference checks before or after making a job offer. Best practice in New Zealand suggests performing reference checks before extending an offer to ensure any decision is fully informed. This approach allows employers to corroborate the information provided by the candidate and to avoid potential hiring mishaps. 

New Zealand legal considerations for reference checking 

It's important to navigate reference checks within the bounds of New Zealand's employment law. Always document the feedback received, as this can be valuable for future reference or if any disputes arise. Here are some key points to remember: 

  • Privacy Act 2020: This act governs the collection and use of personal information, including employment references. You must obtain the candidate's written consent before contacting their references. 

  • Fairness and accuracy: The information you collect during reference checks must be fair and accurate. Avoid discriminatory questions or biases based on factors like race, gender, or age. 

  • Duty of care: While providing honest feedback, references should avoid making defamatory statements about the candidate. 

Crafting a reference check process 

A structured reference check process is an important part of the interview process and vital for consistency and legal compliance. Here are key steps to consider: 

  1. Obtain consent: Always seek the candidate's permission before contacting their references. This respects privacy and complies with New Zealand's privacy laws. 

  2. Prepare your questions: To gain meaningful insights, prepare a list of reference check questions tailored to the role. This should include queries about the candidate’s responsibilities, performance, teamwork, strengths, and areas for improvement. 

  3. Choose the right references: Prioritise professional references from previous employers over personal ones to ensure the feedback is relevant to the candidate’s work capabilities. 

  4. Conduct the reference check: Whether through a phone call or email, approach the reference professionally, ensuring you respect their time while seeking comprehensive feedback. 

Key reference check questions 

Asking the right questions allows you to understand a candidate's past work performance and establishes the foundation for a productive background check. Most common examples include: 

  • Can you confirm the dates of the candidate’s employment and their role in your organisation? 

  • How would you describe the candidate’s skills, job performance and reliability? 

  • What are the candidate’s key strengths and areas for improvement? 

  • How does the candidate work under pressure and in a team environment? 

  • Would you rehire the candidate? Why or why not? 

To provide a more holistic view of a candidate's abilities, work habits, and compatibility with your team, here are additional question ideas: 

Work performance and skills: 

  • How did the candidate handle tight deadlines or high-pressure situations? 

  • Can you provide an example of a project or task where the candidate exceeded expectations? 

  • What technical skills does the candidate possess that were particularly valuable to your team? 

Teamwork and collaboration: 

  • How does the candidate contribute to team dynamics? 

  • Can you describe a situation where the candidate had to work on a team project? What role did they play? 

  • How does the candidate handle conflict within a team? 

Adaptability and problem-solving: 

  • Can you give an example of how the candidate adapted to a significant change at work? 

  • Describe a situation where the candidate identified a problem and how they went about solving it. 

Leadership and Initiative: 

  • Has the candidate ever taken the lead on a project? What was the outcome? 

  • How does the candidate motivate or influence others? 

Professional development: 

  • In what areas has the candidate shown the most significant growth during their time with your organisation? 

  • Has the candidate demonstrated a commitment to professional development or continuing education? 

Cultural fit: 

  • How would you describe the candidate's work ethic and professionalism? 

  • Can you describe how the candidate aligned with your organisation's culture and values? 

Reliability and punctuality 

  • How dependable was the candidate in completing tasks or projects on time? 

  • Were there any issues with attendance or punctuality? 

Communication skills: 

  • How effective is the candidate in communicating with colleagues, clients, and management? 

  • Can you provide an example of how the candidate handled a difficult communication situation? 

Client management and customer service: 

  • How does the candidate manage relationships with clients or customers? 

  • Can you share an instance where the candidate went above and beyond to ensure customer satisfaction? 

Strengths and areas for improvement: 

  • What do you consider to be the candidate's strongest attributes? 

  • What areas would you recommend for further development or improvement? 

Common pitfalls to avoid in reference checking 

Be aware of these common pitfalls to ensure your reference checks are effective and legally compliant: 

  • Skipping reference checks altogether: While time-consuming, reference checks are essential. Don't skip them to expedite the hiring process. 

  • Failing to obtain consent: Always obtain written consent from the candidate before contacting their references. 

  • Asking illegal questions: Avoid questions that could be discriminatory or violate the candidate's privacy. This includes questions about age, marital status, religion, ethnicity, or health conditions. Stick to questions that directly assess the candidate's work skills and performance. 

  • Relying solely on reference checks: While valuable, reference checks are just one piece of the hiring puzzle. Consider them alongside the candidate's resume, interview performance, and any skills assessments conducted. 

  • Sharing reference information improperly: Keep all reference check information confidential. Do not share it with anyone not directly involved in the hiring decision. 

Emphasising the human element 

Remember, reference checks are not just about verifying facts; they're an opportunity to gauge how candidates might integrate into your team's culture and contribute to your organisation's ethos. Asking open-ended questions and listening carefully to the nuances in a referee’s responses can offer invaluable cues about the candidate's interpersonal skills and work ethic. 

Taking the Next Step 

Reference checks are a cornerstone of the recruitment process. By following a structured procedure, preparing relevant questions, and conducting checks in a legally compliant manner, employers can significantly enhance finding the ideal candidate. This meticulous approach ensures your new hire is not only qualified on paper, but also a great fit for your team and organisational culture. 

Contact us today to discover how our expertise can complement your recruitment efforts, ensuring you make informed, confident hiring decisions every time. 

Frequently Asked Questions

Can a candidate withhold permission for a reference check?

Yes, a candidate has the right to withhold permission for a reference check.  However, this could negatively impact their candidacy as most employers consider reference checks a standard part of the hiring process.

What if a reference provides negative feedback?

Thank the reference for their honesty and investigate further. Consider contacting other references to see if there's a pattern.  Don't automatically disqualify the candidate based solely on one negative reference. Analyse the feedback in context and make a balanced hiring decision.

How long should I keep reference check information?

There's no legal requirement for a specific timeframe. However, keeping reference check information for a reasonable period,  such as one year after the hiring decision is recommended.  Ensure secure storage and follow proper disposal procedures when no longer needed.

Can I use references for future job openings?

Yes, with the candidate's written consent, you can keep reference information on file for future opportunities. Update the information and obtain renewed consent before contacting them again.

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