There is an art to checking references. Even if a company has a policy of giving bare minimum information, find out a TELEPHONE NUMBER of someone in that company who knows your candidate and start a conversation. I was given a specific script of questions to ask back in the 1990s when I was a community volunteer for my local public school district, doing reference checks on superintendent candidates. A consultant advised the school district (and through the district, me) on how to do this. If you talk to someone directly by voice, and have a good list of specific questions to ask about the candidate, you will be AMAZED at what people say, policy or no policy. Company policies don't keep people from sharing stories with curious listeners. The key is to learn what questions are legal to ask and reveal the most interesting stories about the person you are thinking of hiring. There are consultants who can advise you about checking references, and, as several comments here say, they are a lot less expensive than making a wrong hiring decision, and once you've learned the questions, you know what to ask.
I've just asked my consultant Google, and he suggests several sets of useful questions to ask when checking references:
You might be surprised how often bad hires end up not having any real references at all, and just bluster their way through that part of the interview. For too many of us, reference checking is an afterthought. Fortunately, when you're small, the feedback loop is tight and you only need to get burned a couple times before you take it seriously.
By which I mean to say, even an anodyne reference ("yes I worked with person, yes I would hire them for this role") is a major improvement over no reference at all.
Also, our own Peroni (IIRC) mentioned that "is $candidate eligible for rehire by your organization" will be answered by nearly all employers. And it's quite useful.
[I have no personal experience, just passing this along.]
I would be careful with that question. I worked at one company where they were very much against re-hiring anyone that left based on where they went/were going.
Another factor is personal differences can lead to that same false positives (negatives?) about that person.
I guess I'm simply trying to say: that question is not always answered based on work ethic or product.
I've just asked my consultant Google, and he suggests several sets of useful questions to ask when checking references:
http://hiring.monster.com/hr/hr-best-practices/recruiting-hi...
http://www.drgnyc.com/list_serve/Jan24_2005.htm
http://www.acadweb.wwu.edu/hr/Employment/InfoForHiringOffici...
http://www.best-job-interview.com/reference-check-questions....
http://www.k-state.edu/hr/employment/referencecheck.htm
http://pbsbo.ucsc.edu/personnel_payroll/staff/recruit/ref_ch...
http://www.bridgestar.org/Library/HiringToolkit/ReferenceChe...
http://jobsearch.about.com/od/referencesrecommendations/a/re...