October 27, 2010

Reference Checking: A Lost Art

By Melanie Lockwood Herman

As we gear up for two brand-new monthly webinar series I’ve been thinking about commonly missed opportunities to protect the missions and assets of nonprofit organizations. While we may be instinctively drawn to the “latest” best practice strategy, perhaps there are time-tested approaches that deserve a second and third look. One area that comes to mind is that of staff screening.

With financial resources in scarce supply, filling key openings with competent and trustworthy staff is a must. Yet experienced nonprofit leaders often bemoan the challenging and often protracted process of finding someone who is a “perfect fit.” The process of recruiting and screening applicants is more challenging when we look for perfect applicants who bring track records of raising huge sums and meeting every roadblock and challenge with unrelenting optimism.

True, there are more people looking for work these days than in the recent past and high speed Internet connections, downloadable applications, virtual job boards and email shorten the time from the posting of an announcement to receipt of the first resume. But the prevalence of technology in the process does little to transform the nature of the process. Finding the best match for a demanding position in a nonprofit is not a science. Choosing wisely from a large pool of applicants is an art. And an often ignored art form within the discipline of staff screening is reference checking.

Over the years I’ve spoken to countless nonprofit leaders about the role and importance of reference checking as a screening tool. In so many cases I’ve been told that obtaining references on prospective employees is “difficult” or “nearly impossible,” given the increasingly common policy of providing only limited information, such as name, title and dates of employment. Some leaders have even owned up to the ironic inconsistency in their HR policies. Although they refuse to provide more than limited information on former employees, they continue to “check” references for prospective employees and volunteers. Close-up these internally inconsistent practices may appear to add a measure of “safety.” By limiting the availability of information on former employees an organization reduces the likelihood of a claim alleging that a defamatory reference was provided. By seeking references on prospective staff an organization may be able to avoid inadvertently hiring a poor performer or worse, someone whose behavior poses a threat to the nonprofit’s clientele or financial assets. And in the event things later go terribly wrong with a new hire, a thorough reference checking protocol—as part of a risk-based screening process—may serve to bolster the nonprofit’s defense against a claim alleging “negligent hiring.”

But it doesn’t need to be this way. At the Nonprofit Risk Management Center we urge our clients to both get and give references and we counsel leaders on how to do both safely. But safe doesn’t mean boring or nor should it refer to a process on autopilot.

I see the practice of reference checking as akin to an “art form” because it offers the opportunity to integrate both creative impulses and professional expertise into your screening process. Rather than call an applicant’s last three employers and ask rudimentary questions, consider developing reference questions that are likely to reveal truly helpful information that will help you distinguish between finalists. For example:

• Ask the former employer of an applicant for a youth worker position: “Would you have any hesitancy placing your child in the care of the applicant?”
• Query the former employer of an applicant for a senior finance position: “While working for your nonprofit, did the applicant have an occasion to convey difficult or troubling financial news to the Board or Finance Committee? How did the applicant balance the need for timely disclosure while instilling confidence in the leadership team?”

The bottom line is the reminder to be creative in crafting reference checking questions and bring your past experience (including hiring mistakes) to bear. Bad hiring decisions are inevitable in the life of a nonprofit leader; walking away without learning something is not.

In his terrific book titled The Complete Reference Checking Handbook, Edward C. Andler reminds his readers that truly effective reference checking requires “getting to the deeper layers of truth…” For example, the author suggests that when checking references one has to resist the urge to accept non-committal answers and move on. The skilled reference checker should never be content with vague replies and should be curious and motivated to know more and why. Andler explains that “The benefits of ‘peeling away the onion’… are well worth the effort.”

Be Safe

To stay on the “safe side” in your reference checking practices, remember to:

• Get permission. Obtain an applicant’s written authorization to verify any and all information contained on the application for employment, including employment and volunteer history.
• Be consistent. Use the same set of reference questions for each position, but rarely if ever for ALL positions.
• Tell it like it is. Always note exactly what a reference says in your notes; never write down your interpretation of a former employer’s comments.

This enews only scratches the surface of a topic we will be exploring in the first episode of our brand-new, four-part webinar series on HR Risks. The series begins on Thursday, January 20, 2011 with a kick-off program on “Getting and Giving References: Safely and Effectively.” To learn more or sign up for a single session or the entire four-part Third Thursdays series, click here.

To learn more about our line-up of monthly webinars, also beginning in January, click here. Our First Wednesdays series offers practical help on topics ranging from “Risk Communication” to “Enforcing Board Responsibilities” and “Fiscal Oversight.”

Melanie Lockwood Herman is Executive Director of the Nonprofit Risk Management Center. She welcomes your feedback on this article and questions about the Center’s resources at Melanie@nonprofitrisk.org or (202) 785-3891. The Center provides free and affordable risk management tools and resources at www.nonprofitrisk.org and affordable consulting assistance.

Two of Melanie’s books include information on the topics explored in this enews. Her most recent book, EXPOSED: A Legal Field Guide for Nonprofit Executives, includes a chapter on Employment Liability. The Center’s book on sound employment practices, Taking the High Road: A Guide to Legal and Effective Employment Practices for Nonprofits, is available as a PDF with active hyperlinks to key source material. Information on both books and other Center publications can be found at www.nonprofitrisk.org/store/hot.asp.