Interesting question from a client the other day  – what if we simply gave up asking for references on new hires?  Just stopped it altogether and so saved all the HR time and delay and cost implicit in the reference-checking process?  Instinctively your response is not to be so daft, everyone always seeks references so it must be right, but then you begin to ask yourself why not, and why that isn’t actually (in the right circumstances) quite a good idea.

After all, what does a reference really bring you?  Confirmation of dates of employment and sometimes job role, but rarely these days anything about competence and more unusually still any useful comment on personality or likely “fit”.   Occasionally the reference can shed a little light on the circumstances of the employee’s leaving his former employer – to see reference to “redundancy” is always reassuring (even though the word is often misused), but “resignation” without a job to go to should raise an eyebrow and anything about the parting being “mutual”, “agreed” or “amicable” never quite fails to imply that it was actually none of those things. As a minimum it means that the employer was not sorry to see him go.  A case of true mutual consent is like a unicorn, but rarer. In addition, the likelihood of a reference stating that the employee was dismissed for misconduct or poor performance is tiny and the reply “no” to whether you would re-employ, if it is answered at all, could simply mean that the old employer does not have the space.

When you make your offer “subject to satisfactory references”, therefore, all you are really likely to get in practice is evidence that the employee’s previous role was what he said it was, not that he was any good at it or was in any other way a congenial colleague.  So there could indeed be some merit in the view (at least in those cases where his previous employment record is actually not that material) that all the hoopla of requiring and reviewing references is genuinely unnecessary.  How might you decide?

1. Is this new hire someone who could do others physical or financial harm in the course of his employment?  In some such roles a reference may already be part of the relevant regulatory regime, but if not, you might still take the view that your duties to those you can envisage being harmed might include taking reasonable steps to check that your new hire does not pose any obvious or particular risk in that respect. It might be said that a former employer would not make any reference to “previous convictions” anyway, but the argument would always exist that because you had not asked, you did not know.

2. Is this someone important or high profile?  All very embarrassing to discover that your new senior executive or public face comes with unacceptable baggage you had not taken the time to flush out through a reference, such that the trumpets and cymbals of the hire are then rapidly superseded by the kazoo of a hasty termination.

3. Does this person need particular technical skills from the start?  If so, it is obviously worth checking whether they have them (although that could equally or additionally be done by a test at the recruitment stage).  On the other hand, if you intend to provide all the training they need, then it hardly matters whether they come equipped or not, so why bother asking?

4. If it all goes toes-up, how bad will it be?  Apart from the publicity angle above, will a combination of a short probationary notice entitlement and limited salary mean that the costs of dismissing the occasional misfire will still be less than those of a full referencing process?  Put brutally, given the savings of time and money in skipping the reference stage, do you care if a fractionally (for it will not be more than that) increased number of your hires don’t work out?

5. What has your past practice been?  Even where job offers have been made subject to satisfactory references, how often have you actually pulled an offer (especially once the individual has started) because the reference wasn’t satisfactory, or given someone a job because of a particularly radiant reference which they would not otherwise have got based on their CV, application and/or interview?

6. How quickly will you be able to determine suitability independent of the reference?  If you would have a feel good enough to rely on one way or the other in a week or so anyway, what does someone else’s view (assuming they are even willing to express it in the first place) really add?

7. Do you need a differentiator?  If you anticipate a substantial number of applications for your role, all within a hair of each other on paper, how are you going to (a) decide who gets the nod and (b) be able to prove to the others that it wasn’t discrimination?  A clearly less enthusiastic reference may well assist here, although beware of the possibility that a particularly positive reference may reflect the former employer’s pleasure at the prospect of being rid of that particular individual rather than his inherent suitability for your job.

8. And the key subsidiary question for HR – do you want to keep your job?  Doing without references is all very well and could certainly produce considerable savings of time and cost, even allowing for the occasional dud hire which you might otherwise have picked up before putting pen to contract.  However, if the dud is someone into whom your senior management has invested any credibility or serious cash (maybe a sign-on bonus) and that hire goes wrong (or could be alleged to have gone wrong) for want of a reference, that will almost certainly become your fault.  No one ever lost their job through seeking a reference on a new hire pointlessly, so abandoning the practice for some or all of your workforce needs to be the subject of some considered thought and cost-benefit analysis before taking that step.