Does Your Company Reference Policy Hinder Hiring?

Providing employment references for past employees was a standard practice but is no longer commonplace. Many companies have decided they get no direct benefit from giving references; they are afraid they may take on the risk of a lawsuit and have determined it costs them money.? And so many organizations no longer provide employment references, and some do not even verify employment dates without a fee. Employees who are part of a layoff are usually unaware of this change until they see it in their exit paperwork.

However, numerous companies, including those that do not provide references, require them to be part of their hiring process.?This practice leaves past employees in a bind. Some strategies shared online to circumnavigate these employer policies include:?

- Getting references from clients and customers the employee supported in their past job. This is probably risker to the past employer than providing a basic reference to the former employee.?

- Requesting a reference from past managers and coworkers even though the business has a “No references provided policy.”?Many do this for separated employees because they are unaware their company has a no references provided policy or they believe they can do a ‘personal’ one on the side. These actions can open a past employer to risk as some past employees get references and some do not, regardless of the blanket ‘no references’ policy.?

- Provide copies of past performance evaluations. This can be risky for the job seeker as it may contain pay or other information they are not required to provide to potential employers. It may also?reveal proprietary information or client and customer names to a competitor.??

- Ask your past employer to verify the dates, type of employment, and job title at least, and then hope they will.?

Not being able to secure references from former employers is an additional worry for job seekers already navigating a competitive and slow-to-hired job market. Refusing to provide a reference can make a past employee feel like the company is blocking their opportunity for a new job. This is also a risk to the past company as it jeopardizes their reputation as an employer and can result in complaints and possible litigation, especially if the job seeker cannot secure a reference from their most recent employer.?

Many companies try to reduce risk by not providing references. However, if employers require references, past and current employees will engage in workarounds that bring on their own potential risks.???

Businesses should review their reference policies, especially during a layoff. Forward-thinking companies with good career transition support know how to include streamlined references for their departing employees and provide free employment verifications as well.??

To Job Seekers, HR, and Talent Acquisition Professionals: What have your experiences gathering or giving references? Do you know your company’s reference policy? How important are they in securing a job offer? What do you do when companies do not provide references??

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