Reference and background checks are a good way to ensure you have the right person for the job, but they are not always straightforward. Conducting simple reference checks on prospective employees has become complicated by privacy legislation.
Private sector employers in British Columbia, Alberta and Québec and federally regulated employers are subject to personal information protection legislation. This legislation imposes obligations on employers regarding the collection, use, disclosure and retention of personal information.
Even if an organization is not subject to such legislation, Canada has a growing privacy culture and many employment candidates will expect employers to take special care with their personal information. For that reason, all employers are well-advised to take the developing privacy laws into account in all their employment practices, including reference checking.
Collection, Use And Disclosure
Under personal information protection legislation, consent is generally required prior to collecting or disclosing a person's personal information. This includes collecting, using or disclosing an opinion about the person. However, in British Columbia and Alberta, "employee personal information" is treated differently.
Alberta and British Columbia's Personal Information Protection Acts (PIPA) allow employers to collect, use or disclose "employee personal information" without the consent of the employee or prospective employee if reasonable for the purposes of establishing, managing or terminating an employment relationship.
Accordingly, when conducting a reference check, the prospective employer does not need the applicant's consent. However, the prospective employer must:
- give the applicant notice in advance that it intends to
contact previous employers or conduct background
- explain to the applicant in advance the purpose or reason
for collecting, using or disclosing the information (i.e., to
make a hiring decision); and
- ensure that the collection and use of the information is
"reasonably required" for the establishment of the
employment relationship (i.e., to determine the job
applicant's suitability for the position).
Although consent from the applicant is not required for reference checks, a prospective employer may still wish to obtain written consent, especially if the prospective employer intends to contact previous employers who are not listed as referees.
If an applicant lists a former employer as a referee, then he or she has implicitly consented to that former employer disclosing his or her employee personal information to the prospective employer. However, if a former employer is not listed as a referee, then that former employer may be in breach of PIPA if it discloses the applicant's employee personal information without consent.
For this reason, it may be prudent to get an applicant's consent up front to contact persons other than those listed by the applicant as references. This consent could be requested on the job application form.
Handling The Reference Information
Once the personal information has been collected, used or disclosed in the hiring process, all other requirements of PIPA apply to that information, including:
- making reasonable efforts to ensure the personal
information collected is accurate and complete,
- making reasonable security arrangements to protect the
collected reference information from unauthorized use,
disclosure, or destruction; and
- retaining information used to make a decision for at
least one year after the use so that the applicant has a
reasonable opportunity to obtain access.
Access To Reference Information
Although there are some exceptions, an applicant is generally entitled pursuant to PIPA to:
- access his or her personal information under the control
of the prospective employer;
- information about the ways in which his or her personal
information has been and is being used by the prospective
- the names of individuals and organizations to whom the
personal information has been disclosed.
Here are some final tips to keep in mind when conducting reference or background checks:
- Ensure you are not violating human rights legislation
— Pursuant to human rights legislation,
employers are restricted from basing hiring decisions on
prohibited grounds such as race, creed, ethnic origin and
criminal record. Information related to these grounds may be
exposed in a background or reference check, which will put
the prospective employer at risk for a human rights
complaint. To minimize the risk, develop a list of questions
in advance that avoid collecting this type of
- Consider the timing of the check —
Because you always risk learning information about a
prohibited discriminatory ground in a reference check,
consider performing the reference check only after a
conditional offer of employment has been made to the
- Keep good notes — Record the
information requested and provided during reference checks
and retain those notes in an employee's file or for
at least one year for individuals not hired.
- Always follow through — If you make an
offer of employment conditional on a positive reference
check, do not allow the employee to start work until
the results of all reference checks have been received and
reviewed. If you cannot wait for the results, consider
inserting a clause into the employment contract that gives
you the ability to terminate the employee's
employment for cause in the event that the results of the
reference check are not satisfactory.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.