Most people would agree that no candidate gives the name of a reference that won't give a good one…WRONG! People will say the strangest things at the strangest moment for the strangest reasons.
Just because a candidate gets a less than favorable reference shouldn't eliminate him from consideration. The definition of a bad reference has to be clear. A candidate previously accused of stealing or was fired for insubordination, are serious references. There are some poor references, however, that may not be sterling but not poor enough to eliminate the candidate.
Take into consideration the level of authority or responsibility the person giving the reference has. A few months ago an employer went to check a reference of a candidate at one of the candidate's previous employer. Most everyone the candidate had worked with had left the firm save one. ...a secretary. She was asked to give a reference on the candidate. Oh boy! She had neither the authority or the responsibility.
If a poor reference is given, it's important to be sure of a few things. First, get clear, specific, exact reasons for such a reference from the reference source itself. Be clear of exactly what the references mean. A hazy generalization like "he was an average employee" is just too general. Make sure facts are separated from feelings. How a previous employer feels about an ex-employee is important, but facts as to exactly what kind of an employee the candidate was, mean a whole lot more.
Secondly, consider the source. Take into account the personalities, situations, etc., of the reference. A reference from an employer of a candidate seven or eight years ago simply can't give as good a perspective of the candidate's present skills.
A previous supervisor for instance, that only supervised the candidate for six or seven months isn't in as valid a position to give a qualified reference as someone else might be.
A poor reference might be a result of the overall economic condition of the previous employer. It might be a result of practical conditions like the necessity of the ex-employee to all of a sudden have to travel extensively whereas before he did not. Restructuring and reorganization of companies and the redistribution of bosses and personalities can result in incompatible people being thrown together. Separate the emotional aspects from the real business issues.
Another dangerous reference to be leary of is the third party reference. This is the person who either works for your company already or is an acquaintance who used to work with the candidate in a previous company or the person who knows somebody who knows somebody who knows somebody who use to work with the candidate... .back in '48! These people often give a negative opinion of the candidate. They have nothing to win or lose by their comments. It is easier and safer for them to say negative things or cast dispersions on the quality of the candidate. They have nothing at stake and want to appear knowledgeable and important. We have seen many candidates eliminated because of these third party opinions. Unfortunately employers listen to these people too often. Our fear of making a mistake in hiring promotes our taking such comments too literally. Remember that it's just too easy to be negative. A decision should not be based solely on their comments.
Deeper, more thorough investigation beyond a poor reference will either offset the reference or reaffirm it. It must be emphasized that one poor reference should not totally eliminate a qualified candidate.