What are references?

In an HR context, references are opinions and information about a candidate provided by their former employers, supervisors, colleagues, or other individuals who have had professional contact with them. References can take written form (an official document describing the employment history) or verbal form (a meeting or phone conversation with the reference provider).

References aren't a mandatory part of the recruitment process, but they're often required or recommended when hiring for management positions, specialized roles, or positions requiring significant responsibility (such as data access, client contact, or budget management).

What is a reference check?

A reference check is a stage in the recruitment process where the recruiter contacts the candidate's former employers or individuals specified by the candidate to verify information provided in their resume and gain a deeper understanding of the candidate.

Reference calls typically include a few standard questions, such as:

What were this person's main responsibilities in their position?
How would you rate this person's engagement and quality of work?
Would you rehire this person? If not, why?

Depending on the position and context, you might also ask about teamwork, independence, or how they handle pressure.

How does a reference check differ from a background check?

A background check involves verifying details from a candidate’s professional and personal history. Depending on the position requirements, it may include confirming employment history, education, criminal record, driving record, or credit history.

Reference checking focuses on gathering opinions from people who have worked with the candidate. This provides insight into their work style, professional relationships, engagement, and soft skills – aspects that can't be verified through documentation. References can form part of a broader candidate assessment process, particularly for roles that require a high level of trust.

Should you check candidate references?

References provide additional context that helps you better understand a candidate's work style, engagement, and professional relationships. They're particularly valuable when recruiting for positions requiring independence or collaboration skills.

However, keep in mind that opinions from former supervisors or colleagues are always subjective and may carry bias (positive or negative). The same applies to written references initiated by the candidate. These are often generic or exclusively positive, failing to reflect actual competencies.

Therefore, references should be treated as a supplement, not the primary evaluation criterion. Their value increases when combined with other recruitment elements, such as interviews, practical assignments, or competency tests.

Legal limitations related to reference checking

Reference checking is a form of personal data processing. In most countries, reference checking requires:

candidate consent to contact third parties;
maintaining transparency and proportionality (candidates should know who is obtaining information, when, and for what purpose);
limiting requests to data relevant to recruitment only (such as professional experience, competencies, or work style).

Some countries, like the United States and Australia, have additional regulations, often governed by local or state privacy laws.

In European Union countries, where GDPR applies, references are treated as personal data. This means:

There must be a legal basis, such as candidate consent or the employer's legitimate interest.
Processing should be purposeful and limited to the necessary minimum (only data needed at that recruitment stage).
The entire process should be transparent (candidates should know who will process their data, for what purpose, and for how long).

Remember that GDPR doesn't exclude additional national regulations. Some countries (like Germany and France) impose stricter requirements, such as requiring written consent for sharing references or limiting the scope of data that can be disclosed.

Is it worth using reference checking services?

Outsourcing reference checks can be justified when:

recruiting for high-responsibility positions (e.g., CFO, CTO, Country Manager);
conducting international processes and needing support contacting foreign employers;
wanting to maintain neutrality and objectivity (e.g., in conflict situations or internal recruitment);
lacking internal resources to conduct professional reference checks.

Third-party reference checking providers offer services that comply with GDPR. They can act as data processors on behalf of the data controller (the employer).

How to leverage an HR platform for reference checking

If you're planning to include reference checking in your recruitment processes, utilize HR platform features like those offered by PeopleForce. This helps you organize the entire process efficiently while maintaining regulatory compliance.

On the platform, you can:

Add a “reference check” stage to your recruitment funnel, making it visible to recruiters and hiring managers.
Record candidate consent for contacting reference providers.
Securely process data in compliance with GDPR requirements, with the ability to track who accessed information and when.
Attach received references directly to the candidate's profile as attachments or notes.
Share references with selected individuals (like hiring managers) without sending data outside the system.
Add your own notes or summaries after reference conversations.

Thanks to integration with qualified electronic signature tools, all candidate consents can be obtained in digital form. This increases documentation credibility and facilitates GDPR compliance.

Summary: Why reference checks matter

Reference checking allows you to gather information about a candidate's work performance and behaviors that may be crucial when evaluating their fit for the team and position. Benefits of including this stage in your recruitment process include:

more accurate hiring decisions;
reduced risk of bad hires;
lower turnover-related costs;
faster vacancy closure;
better process documentation, especially with HRM system support.

It's a useful tool, but its application requires caution, as GDPR and other regulatory obligations may limit the scope and method of information gathering. Poorly planned processes – such as checking references without consent, asking irrelevant questions, or mishandling data – may expose your organization to legal risks and damage candidate trust. Therefore, it's worth establishing transparent procedures and seeking legal consultation or outsourcing this task to an external firm if you lack the appropriate resources or experience.

Reference check