The Real Cost of Employee Referencing

Potential Employees

Recruitment is a costly business – agency fees and advertising rates alone.  But, what few employers omit to factor into their ‘cost per hire’ calculations is the hidden expense of in house referencing. So, just imagine if, in exchange for ten seconds of your time and a maximum cost of £3 per prospective candidate, you could expect rapid turnaround of references at a typical completion rate of 75-80%?

There’s no getting away from it – referencing is a ‘must have’, which you ignore at your peril. Pre-employment referencing is a vital step in the recruitment journey, reducing the risk of bad hires and protecting your reputation as a business. Taking up references is important to check that the person you wish to hire has in fact done the roles that they say they have, and that they have displayed the qualities and behaviours that you wish to hire. Although you might consider your recruitment process to be robust and revealing, there is no substitute for working with someone over a long period of time, to seeing that person subjected to many different situations and scenarios, and to finding out how they actually perform in practice. You can’t do this first hand, until they join, but that’s why getting feedback from those who have already worked with this person is a huge advantage in predicting their future performance.

The Hidden Costs

But, mention employee referencing to many businesses and you will probably be greeted with a collective sigh. Most would acknowledge that it is time-consuming, frustrating, tedious and burdensome, but few recognise one of its other major shortcomings; cost. It’s a necessary evil, of course, and in companies fortunate enough to have admin teams, it generally gets ceremoniously dumped on the most junior cog in the wheel to complete.  It’s easy to understand why – it is, after all, a fairly mundane, repetitive and process driven task requiring much in the way of patience and tenacity, and little in the way of skill.  But it is also incredibly and unnecessarily time consuming, and that’s where the hidden costs lie, making referencing ‘in house’ a false economy.  Even at the most basic hourly rate, once those man hours stack up – sending letter after letter to referees, making chase up call after chase up call, and endlessly collating information to run reports on outstanding references – the process starts to become rather costly, and represents an inefficient use of resources.  It’s not just about the amount of payroll budget that time spent referencing absorbs, either.  It’s also about lost productivity and opportunity on other more engaging and progressive projects.  In other words, the time your people spend writing to and calling up reluctant referees could be much better invested in working on some of those ‘nice to have’, rainy day projects that will actually advance your business and carry some developmental benefit for your people. Perhaps most frustratingly of all, your vacancy remains open (in spite of having a potential candidate ready and raring to get started) while you wait for references to come in, meaning continued loss of business productivity, and on-going pressure on other team members who are ‘carrying the can’.  It’s hardly surprising that many employers fall into the trap of going ahead with the hire ‘subject to references’, risking a costly mistake by bringing someone into the business who might not be all they say they are.    The bottom line is that referencing ‘in house’ costs money and time (and it slowly but surely chips away at the soul of the unfortunate individual(s) tasked with carrying it out).

ReferenceExpert: Affordable Outsourcing

So, just imagine if, in exchange for ten seconds of your time and a maximum cost of £3 per prospective candidate, you could expect rapid turnaround of references at a typical completion rate of 75-80%.  Mind blowing, right?

Here at great{with}talent we understand that outsourcing can be expensive.  More to the point, we understand that paying through the nose for something as menial and process driven as referencing probably smarts a bit. That’s why we’ve developed ReferenceExpert, a solution that offers reference checks at a fraction of the price of other systems, and takes collecting references into the modern age. Our aim is to make it easier, quicker and cheaper to do it, and we achieve that by making technology do the work for you. All you need to do is log onto your account and spend 10 seconds adding the candidate (you can even get them to do it themselves, in fact) and select which type of reference you need, either a detailed or a basic reference (the price is the same regardless). We do everything else – send out the email, chase up referees for you and alert you when they are available – so you or your employees can spend your valuable time doing something more constructive and a little bit less joyless. You will have access to three different types of reference request, from a standard confirmation that an employee was known to a company, to a personal or much more detailed request for information – we can tailor the questionnaires to suit your exact needs. Full PDF reports, which clearly outline the referee feedback, are available with just one click. We can also integrate Reference Expert with your recruitment software or HR system to make your recruitment and referencing processes link seamlessly.  The whole process can be tailored to your needs and we can even customise it for you by adding your logo onto everything.   Just a quick recap – all this costs you no more than 10 seconds per prospective hire, and the maximum you’ll pay is £3 per completed reference.

Pay As You Go

Our pricing is simple and clear, with no hidden costs. With Reference Expert you buy ‘units’ to use when you need them so you are not paying for a monthly subscription that goes unused; units have no expiry date, and each completed reference uses up one unit, meaning you literally get what you pay for (you will not be charged for any incomplete references). So when times are lean and recruitment takes a pause, so do your referencing expenses.  It’s a completely flexible service that works when you want it to and the pay as you go set-up makes it incredibly cost effective.  We believe in economies of scale, so the more units you purchase together, the cheaper the price per unit.

Our response rates are fantastic (75-80%) because we have created a reliable and user-friendly system.  We haven’t just focussed on making the process hassle free for you, the employer, but also for the referees whose speed of response you are reliant upon.  The whole system is mobile enabled, meaning that we can place your reference requests at the fingertips of the referees (via text or email), encouraging immediate, on the go responses.

Free Trial

If all of this doesn’t have you 100% convinced, you can sign up for a free, ‘no strings attached’ trial for 30 days. For more information or to request a demo, visit our website

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