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Online Reference Checking Explained: What, When, Why and How

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Benefits of online reference checking

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Reference checking is a crucial component of the hiring process. 

Employment checks are the only opportunity to obtain an external opinion about a candidate applying for a job. 

The feedback and insights from someone other than the candidate. This information is crucial when making decisions for a new hire.

In this blog, we'll explain:

  • Online reference checking
  • Reasons why using software is better
  • Benefits of an automated reference checking service
  • How Xref checks references
  • Best time to automate employment verifications

What is online reference checking? 

Online reference checking is the digital approach to pre-employment checks. Employers that conduct online reference checks use a software platform for the process. Online reference checking is a more convenient, secure and reliable method.

Employment checking is a crucial element of the recruitment journey. An automated system is the more convenient, secure and reliable method to complement the interview process.

Automated reference checking changed the old process of making phone calls to previous employers. 

With the automated service, recruiters check information provided by job applicants. Employers make enquiries to a short reference list of past employers. References provide their responses on the software application. Questions are normally related to facts, dates and additional information.

Reference check questions are designed to obtain information that is relevant to the candidate selection. Some of these questions are:

  • Is the information from previous employers matching data? 
  • Is the applicant a good fit?
  • Are there any red flags?

Other relevant information obtained from employment checks is:

  • Strengths and weaknesses
  • Cultural fit
  • Previous work histories
  • Confirmation of previous job titles and dates of employment

Automated, online reference checking provides a faster, safer way of collecting valuable insights, helping hiring managers make quick and confident decisions.


Why checking references with software is better?

Using software for pre-employment checks is better for candidates, employers and references. A good platform will offer great benefits:

  • Mobile friendly experience offers flexibility. An online process enables employers to request referees and job candidates to input their details on the move. If the platform is friendly for multiple devices references can respond at the most suitable time.
  •  Candidates are regularly updated. With phone-based checks, it is hard to know the exact progress of the process. An online process provides regular updates on the progress of the reference. 
  • Adaptable to different hiring requirements.  Online checks allow employers and hiring managers to tailor their verification questions. Recruiters can adapt open ended questions for every role and even candidate. Building different questionnaires for different jobs takes a few seconds. The goal is to ensure the feedback received is relevant to support their hiring decision.
  • A consistent process. Phone-based checks are performed with a different approach. The results depend on the referencing style of the person leading the process.  Online platforms like Xref ensure consistency. Every reference conducted is compliant. This automated process reduces any chance of candidate discrimination.

Branded graphics for reference checking process

5 Benefits of automated references

You can expect multiple benefits when automating pre-employment checks. Let’s understand the advantages that a great service like Xref provides:

  1. Hire faster

Xref’s process is quick. It takes only  30 seconds to make a request. 

On average, it takes 24 hours for a reference to be returned. 

When reference checks are faster, it is easier to make hiring decisions.

Xref user Kimberley Hubble from Hudson RPO, who noted: 

“Xref takes, on average, five days out of our recruiting process. It allows our recruiters to spend more time building hiring manager relationships." 

  1. Improve candidate and reference experience 

The progress of the pre-employment checks is provided to candidates in real-time. 

Previous employers experience less disruptive calls during working hours and can respond at a time that suits them. 

The team at Lion have noticed the impact of these benefits, with Katharine Davidson, Talent Acquisition Leader, stating: 

“Xref has made the reference checking process so quick and easy for our candidates and their referees.” 


  1. Create compliant talent pools

The reference checking provides an opportunity to build a talent pool of future candidates. Often the way data checks are recorded, stored and used is non-compliant. 

Xref software allows organisations to store securely the contact details of references who provide consent to be contacted. 

Australian Unity identifies the benefits of compliance and convenience of finding potential recruits: 

“Having access to a proactive searching platform reduces our need for costly job advertising. It also minimises recruitment spend and enables us to make targeted recruitment efforts.” 


  1. Manage data securely

With an online platform like Xref, all contact details and feedback are collected and securely stored for future use. 

Traditional reference checking processes are not very safe. There is a need for a process to store and manage contact details and notes. This is more complex when data is captured over a phone call. 

The risks on data management are higher when the process is not automated.

APG&Co did no consider this additional layer of security as essential but they are very grateful to have it with Xref:  

“We enjoy the assurance that we are complying with data privacy regulations. A risk we hadn’t sufficiently acknowledged when referencing in the past.

  1. Make confident hiring decisions

Traditional reference check insights present difficulties for interpretation.

Employment background checks over the phone present difficulties to identify reliable information and possible fraudulent candidate activity. 

An online process ensures that feedback is shared verbatim. With software assistance answers are accessible for future managers.

With automated reference checks, the insights received are both detailed and accurately interpreted. 

Xref detects any unusual activity that occurs during the process. The fraud detection piece has been significant for the team at Michael Hill:

“We would not have actively sought out the fraudulent activity during the reference checking phase before. It would just have been down to luck if we identified anything suspicious.” 

How is the process with Xref?

With Xref, online reference checking is a simple 3 step process

1. A 30-second request

The Xref journey starts when an employer or recruiter enters the details of their candidate into the Xref platform.

2. The candidate provides details

This initial request triggers an email to the candidate, asking them to provide details of their reference contacts.

3. References provide their feedback

Once the candidate provides contact details, their previous employers receive an email. The email includes a link to the Xref platform with a request to provide their feedback online. The hiring employer defines the set of questions.

The Reference Reports

The employer and recruiter receive the reference reports a few seconds after the reference check is completed,

illustration for 3 steps to request Xref

Best time to move into an automated service

Here are seven indicators that it may be time to move to a software solution for reference checking:

  1. You are losing candidates due to delays at the reference checking stage
  2. Your reports from employment checks are inconsistent
  3. You are unsure if your reference checking process is compliant
  4. Referencing is delaying your hiring decisions
  5. You have no way of validating who you are speaking to when contacting a referee
  6. You are not confident about the security of candidate and reference data
  7. Your employment verification system is damaging your candidate experience

In Summary:

Why online reference checks?

There are many reasons why you should consider online reference checks:

  • To reduce time. In recruitment, time is a crucial factor. Minimising recruitment admin is essential to remaining competitive.
  • To reduce admin tasks. Digital reference checking eliminates manual admin tasks.
  • To be compliant. Human resources teams need to ensure it is done quickly and with compliance.
  • To make more informed decisions. Robust employment checks remain essential for confident recruitment decisions. 
  • Useful for all different type of roles and industries. Automated checks can be tailored for the different needs of different industries for multiple vacancies. 


Book a demo to find out why Xref is a great reference checking software.

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