MUMBAI: Even as hiring has gone digital and companies are adopting new methods of assessing candidates, the good old tradition of reference checks continues to hold strong even today, with a majority of companies rejecting candidates whose reference checks did not meet expectations.
In a study of 200 HR managers/leaders by recruitment company Antal International, nearly 69% respondents said they would not hire a candidate whose reference check was not up to their expectations.
However, given the shortage of talent, the balance 31% said they would still go ahead and offer the job to the candidate under specific conditions such as lowering compensation than what was budgeted, or reducing the title that was previously negotiated with the candidate. Some said they would offer a lower scope of work than what was previously discussed.
Antal International India managing director Joseph Devasia said, “In the age of AI and machine learning integrating with recruitment, this survey highlights the human element in the hiring process. In today’s world, with war for talent remaining unabated, our experiences suggest that employers still weigh the information obtained via reference checks to give themselves the extra validation they need before they make the hiring decision. It’s interesting to note that whereas sourcing and early screening process of recruitment are getting automated, the more critical stages of interview will continue to need human intervention. Bad hiring decisions cost companies a lot of money and it is to partially avoid such errors that reference checks can come in handy.”
Considering that hiring of mid to senior candidates is a tedious process — at times taking months to close — hiring a wrong candidate can cost companies an average of 30% of the first year’s potential earnings. Reference checks, said Antal, can help companies zero in on the right candidate. Up to 67% of respondents in the report, which was shared exclusively with TOI, said they rely on internal HR teams to conduct reference checks. A huge majority (93%) of respondents said they strongly support the practice of reference checks while hiring mid- and senior-level professionals. Of these, 58% said they would not roll out the offer without completing the reference check of a candidate.
Mahindra & Mahindra executive VP (group human capital & leadership development) Prince Augustin said, “Reference check is a valuable pre-hiring exercise that gives insights into background, fit and cultural dexterity of a person. These can be obtained through digital and one-on-one feedbacks, which together is a powerful input for making hiring decisions.”