Reference Check vs Background Check:

While many companies assess whether they should conduct a reference check vs background check, I recommend that you do both. 

Why? 

Let’s discuss the differences between the two and why conducting both is important when identifying your next team member.  

Reference Check vs Background Check: What are the differences?

The main distinction lies in the type of information each provides: background checks confirm employment and credentials, while reference checks reveal how well a candidate performed in their role.

Reference Checks

I often hear hiring managers state that they don’t check references. When I ask why, the explanation is usually that they expect candidates to always provide references that are glowing…so why waste time?

You can assess whether they can self-assess.

For these hiring managers, I would state: According to our numbers, about 25% of references give negative feedback, including supervisors who have fired, managed out, or placed candidates on performance plans.

This highlights a crucial skill that the candidate may be missing: self-assessment. Candidates who offer references likely to provide poor feedback demonstrate a lack of self-awareness, making reference checks a valuable filter. If a candidate provides one or more references who give poor feedback or refuse to participate, it’s a red flag for self-awareness and judgment.

Reference Checks Assess Cultural Fit.

Roughly 20% of candidates receive references that are mostly positive but include constructive feedback. I love it when this happens because this type of feedback helps us determine the candidate’s best fit. It clarifies whether a candidate thrives with hands-on management, in collaborative teams, or in structured versus startup environments. These conversations go beyond confirming qualifications; they help you determine if the candidate will excel in your specific environment.

You can assess their ability to follow directions.

Let’s face the fact that the ability to follow directions is a skill many people just don’t possess. I am aware of many companies that conduct a formal assessment to evaluate whether their candidates can accurately comprehend and execute instructions.  And while I appreciate the value of this type of assessment, why not weed out candidates who struggle with following directions throughout your qualification process?  

Reference checks can also test a candidate’s ability to follow instructions. Despite clear guidelines on the type of references and contact information required, many candidates fail to comply, which itself is telling. Specify the roles and recency of the references you want, and always collect both email and phone contacts. Verify the reference’s relationship to the candidate and be alert for falsified references. Use open-ended questions in live conversations to uncover both technical and soft skills.

When you request references, make sure you define the process and then assess if the candidate is able and/or willing to follow it.  Some things to consider:  

Define the roles you expect the references to have. 

All candidates should be prepared to submit references who have provided them with work direction. I once had a consultant who told me he didn’t have supervisor references because he was a contractor! Everyone has someone to report to. Even the business owner is accountable to someone. When assessing the validity of a supervisor reference, look for someone who can speak to the candidate’s ability to meet deadlines, submit quality deliverables, meet or exceed competency requirements, and build an effective rapport with team members. 

And while obtaining supervisor references is important, also consider what other roles may provide a well-rounded view of the candidate’s skills or qualities. If the candidate is in a supervisory role, consider asking for direct reports. If the candidate is a CRA, ask for site references. You want to see how well the candidate takes direction as well as provides support or work direction to others. 

Be clear regarding how recent the working relationship should be. 

We also recommend that references be fairly recent. We require all of our CRA candidates to provide at least one supervisor and one site reference from a recently completed assignment or project. While it may be understandable for a candidate to abstain from providing references from their current position, when a candidate fails to provide references from their last couple of positions, consider this a flag. 

Outline the contact information you require for each reference. 

We ask our candidates to provide an email and a phone number for each reference. We request both because it doubles the chances of connecting with the references. And this obviously benefits the candidate. But often, the candidates refrain from providing appropriate contact information for their references.  

Besides contact information, ask for details of the working relationship. For example, what was the title of the reference? What company was associated with the working relationship? What were the dates the reference and candidate worked together? This information can help you evaluate the reference’s validity up front, as well as corroborate the story between both sources afterward.

One more thing to consider.

References can be easily falsified, so conduct due diligence on each reference. We often see candidates represent someone as a clinical trial manager who isn’t. I have even spoken with references who have come clean that they are really a wife or sister. You should also know that business email addresses can be spoofed, so don’t assume that just because a work email was used that the reference is valid.  

Create a reference template with open-ended questions that will cover both competency-based skills and soft skills. And while I realize that emailing the reference questionnaire to the references will save you time, don’t do it. This approach will expose you and your team to mediocre or even fraudulent responses. Use your reference template to guide you as you speak to each supervisor reference. Verify the individual’s title, the company associated with the working relationship, and the dates the reference and candidate worked together. You will be amazed at the insights you will gain by being thorough with your reference checks. 

Background Checks

Background checks focus on objective data. When considering the ‘reference check vs background check’ question, understand that while references are more related to a candidate’s past job performance, background checks look up a person’s actual records.

The most commonly checked areas are criminal history, employment verification, confirmation of stated education, and credit history. However, some companies may also conduct drug testing, pull the candidate’s driving record, confirm professional licenses, and even scrape the candidate’s social media profiles. And in our industry, we run a Healthcare Sanction check to ensure there have been no industry-based regulatory violations or related civil or criminal offenses. 

A couple of things that we recommend when ordering a background check: 

An employment history check may not be needed. 

Before you pay a third-party vendor to confirm the candidate’s employment, check a couple of things. First, confirm the candidate’s resume matches their LinkedIn profile. And if you have older versions of the candidate’s resume, compare the data. We often see where candidates will change their employment…not just the dates, but sometimes their entire employment. Just this morning, we had a candidate who, only two months ago, stated she had worked as a coordinator at Houston Methodist, but today’s resume stated she worked at Johns Hopkins instead. 

Additionally, understand that a company listed on the candidate’s resume may not be real. And for authentic companies, be mindful of the dates of operations for all companies listed on the candidate’s resume. Fraudulent candidates will represent that they worked for a company before or after the company existed. There is no need to pay a third-party vendor to verify employment if you can easily tell that the dates of employment do not align with when the companies were founded, acquired, or went out of business. 

Also, keep in mind that employment verification for consultants can be tricky. Often, the only way to confirm past contracts and assignments is via a reference check because HR departments don’t typically track consultant engagements. 

When you do move forward with an employment history check, keep in mind that companies are limited in what information they can provide. A typical employment verification will usually yield the candidate’s true title and dates of employment, but may not offer other details. Regardless of what data you receive, always compare the results with the information the candidate has presented.  

When verifying the candidate’s stated education…

…understand that third-party vendors aren’t always going to be able to identify if a degree is real. Diploma mills have been big business for years, with several sources citing hundreds of fake universities currently in operation. At one point, the issue was so rampant that the FBI became involved with one particular agent co-authoring a book titled Degree Mills: The Billion-Dollar Industry That Has Sold Over a Million Fake Diplomas. The 2012 release of this title provides recommendations on how to protect yourself. 

We dig into some of these suggestions in an article because it is important to be aware of the more common tactics to protect yourself. 

One more thing to note: 

If a background check uncovers issues with credit, driving, or criminal records, don’t automatically disqualify the candidate, especially if they disclosed these issues upfront.

Reference Check vs Background Check…In Closing

There is no simple path. Finding the right team member requires thoughtfulness because doing it the right way is important. While we recommend you engage a third-party partner to help with some of these steps, your involvement throughout the process will help ensure a terrific match.