Why Perform Background Investigations and Reference Checks?

One of the easiest ways to avoid hiring mistakes is to check the candidate’s background thoroughly. Doing so is inexpensive and (if done right) useful. Most employers check and verify the job applicant’s background information and references. There are two main reasons to check backgrounds—to verify the applicant’s information (name and so forth) and to uncover damaging information. Lying on one’s application isn’t unusual.

How deeply you search depends on the position. For example, a credit check is more important for hiring an accountant than a groundskeeper. In one poll, the Society for Human Resource Management found that 98% of 433 responding members said their organizations would verify dates of employment for current or former employees. However, 68% said they wouldn’t discuss work performance; 82% said they wouldn’t discuss character or personality; and 87% said they wouldn’t disclose a disciplinary action.

Many supervisors don’t want to damage a former employee’s chances for a job; others might prefer giving an incompetent employee good reviews to get rid of them. Another reason is legal. Employers providing references generally can’t be successfully sued for defamation unless the employee can show “malice”—that is, ill will, culpable recklessness, or disregard of the employee’s rights. But many managers and companies understandably still don’t want the grief.