Reference checks all important for insurance: leading HR firm

Reference checks all important for insurance: leading HR firm

Reference checks all important for insurance: leading HR firm Gold Seal, an Australian HR and compliance firm, has warned insurance companies about the importance of reference and background checks for new employees following several high-profile 'bad hires'.

Within the insurance industry, it is paramount to check reference and background information as failure to do so could result disciplinary action from ASIC.

Gold Seal warns that it is not only work history that needs to be checked but also right to work in Australia, ASIC and credit registers and any other qualifications listed.

Gold Seal points to a recent survey published in The Australian that found that a 'bad hire' can cost a company two and a half times the employee’s salary. It is not just a monetary concern though as a bad hire could have a huge effect on the reputation of your business

Gold Seal’s managing director, Sheila Baker, noted that the negative effects of a bad hire can have detrimental effects on your team as a whole.

“Effective background checking ensures compliance with legislation and regulatory bodies and helps avoid the possibility of heavy fines, loss of an AFS license or public disgrace.

“At the very least anything that saves you and your team from the emotional cost of a ‘bad hire’ is worth every cent.”

As a guide to effectively check references, Gold Seal has told employers to wait until they have a final shortlist to check all references and to prepare reference checking questions in advance to save time and ensure that the process is standardised across all applicants.

Gold Seal point to the recent hiring and firing of Andrew Flanagan, former group general manager, strategy and business development at Myer as a case-in-point that 'bad hires' can happen in any role, no matter the size of the company.
  • Johnny 18/11/2014 11:22:16 AM
    My previous employer doesn't give detailed references (beyond confirming that I worked there between such & such dates, no personal or technical commentary) & before that I was self-employed for 10 years in a different industry.

    So, assuming I want to apply for a job but not tell my current employer, I've got no references. I guess I'll never get a job based on this article.
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  • Sheila Baker 18/11/2014 2:18:43 PM
    Hi "Johnny": As a rule we advise employers rather than candidates but if I were in your shoes I'd say there's more than one way to skin a cat. I'm quite sure you will have had positive business relationships with more than your previous employer. When you want to get serious about it, give us a call - perhaps we can offer some suggestions.
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