Reference checks in Japan [2023 Guide]

When you’re on a job hunt, it feels as though everything is fair game.

Within the limits of reason and common sense, you can brag about even the smallest of your internships or exaggerate your past roles at companies where people may not even remember your name. 

There are even countless articles, videos, and recommendations online teaching you how to present yourself in the best light possible. I even have a few on this blog — for instance, the guides on preparing a developer resume and writing a good cover letter for tech companies in Japan. 

As long as you’re not flat-out lying, there’s nothing wrong with it. After all, you want to do all you can to make sure that you’re painting a desirable picture of yourself for the company you apply for.

However, while you may have full control over the documents you’re submitting, you might not always have control over what others may say about you. This is what reference checks are all about.

Essentially, reference checks ensure that you are who you say you are, and it’s a way for potential employers to clear any suspicions they may have about your professional past by asking your previous employers or colleagues directly.

So, how common are these reference checks in Japan? 

That’s exactly what I’m here to talk about today. In this post, I’ll explain what a reference check entails and how common it is for companies to do reference checks. I’ll also talk about what types of companies do reference checks and introduce a few examples.

What Exactly Is a Reference Check?

As people jump through hoops to deceive potential employers nowadays, it’s becoming more and more important to confirm whether a candidate is telling the truth or not. 

In such an environment, it’s only natural for companies to have a hard time taking every piece of information provided to them at face value. Picking up the phone and talking to a past manager seems like the go-to choice. 

Essentially, a reference check is exactly that: it’s a way for a potential employer to verify the information you provided with someone who’s had first-hand professional experience with you, the candidate. Think of it as an extension of your job interview that’s conducted with your past employers, managers, or colleagues. 

However, while reference checks can be a powerful tool in regard to hiring accuracy, they’re also time-consuming, as they may require interviewing more than one person for each candidate. 

This is why, in reality, reference checks aren’t utilized nearly as often as they can be. Instead, companies may simply prefer to do a background check, but what’s the difference between the two, really?

How Is a Reference Check Any Different From a Background Check?

A background check can be much more extensive than a reference check and can sometimes even involve the process of reference checking as well.

Overall, a background check is a more involved process that can also include checking the candidate’s educational and professional history and, in some cases, even their criminal history. Some companies even go as far as to check the candidate’s social media profiles to gather information about their personality and habits. 

However, ideally, a background check should be based on the candidate’s consent and shouldn’t involve anything that may fall within the limits of one’s private life.

I talked about this in my post on background checks in Japan, but most modern companies in Japan nowadays only do background checks on candidates’ educational and professional histories and then do reference checks when necessary.

Nowadays, checking someone’s personal background without consent is rare in Japan, especially in the tech world, but these companies still exist. If you want to learn more about companies with questionable practices that you may want to steer clear of, you can head over to my post on black companies in Japan.

Are Reference Checks Really Common in Japan?

Having defined what a reference check is and how it’s different than a background check, you may be wondering: how common are reference checks in Japan?

Depending on how you look at it, the answer may come as a relief or a shock, but generally speaking, reference checks aren’t really that common in Japan. 

It may be more prominent in some industries than others, but in general, not many companies take the time to talk to your former colleagues or professional contacts to confirm whether you’re absolutely telling the truth about everything. 

Most of the time, companies just make do with a general background check, which, as I explained, can mean a variety of different things for different companies. 

Essentially, Japanese companies usually tend to rely on their own processes when it comes to hiring. Most traditional companies in Japan have their own aptitude and personality tests where they rate candidates’ qualifications and personalities on a scale that they believe to be objective.

What’s more, Japanese companies like to do a series of interviews and group exercises as well to determine whether a candidate is a good fit for the company. 

Lastly, another reason why companies may not feel the need to rely on reference checks has to do with the fact that most traditional companies in Japan don’t really care whether you’re technically qualified or not if you’re a new graduate. 

When traditional companies hire new graduates, they usually hire based on character, thinking that teaching the job to the candidate is the easy part. So, companies hire candidates that they think have fitting personalities for the job and are not interested in finding out whether the qualifications stated in a resume are true or not most of the time.

What’s more, Japanese people tend to avoid speaking negatively about others in public settings, and they deeply value their privacy. 

Besides, even if they wanted to do a reference check, many HR professionals in Japan admit to not being able to obtain useful or accurate information from reference checks in general.

Still, as I said, the frequency of reference checks can vary from industry to industry and even among new graduate and mid-career candidates. Let’s take a look.

Reference Checks in Japan: How’s the Situation for Mid-Career Candidates?

Considering the fact that getting hired as a new graduate and working at the same company for almost a lifetime has been the norm in Japan for quite some time — see my post on Japanese salarymen — this mindset didn’t really bode well when it came to mid-career hires in the past, but they’re now becoming increasingly common.

So, while it may not be common for companies to conduct reference checks for new graduates and people who are in the early stages of their careers, statistics say that this may not be the case anymore when it comes to mid-career hires.

According to a survey by enWorld, a global recruitment agency operating in Japan, among 303 responding global Japanese companies and international companies operating in Japan, 70% of the companies that do reference checks have stated that reference checks do affect their final decisions when it comes to hiring mid-career candidates.

If we dive deeper, 35% of participating Japanese companies and a whopping 58% of foreign companies have confirmed that they check references as part of their regular hiring process, which shows that while it’s becoming somewhat common, Japanese companies still don’t rely on reference checks anywhere near as heavily as global companies.

Additional Findings Regarding Reference Checks: Is It a Last Resort?

In addition to the statistics above, the survey also concluded a few other interesting findings regarding the use of reference checks in Japan.

For instance, it was also discovered that, if they decide to do it, the majority of the companies (62%) usually check a candidate’s references after the last round of interviews before they make an offer to the candidate. 

This can mean that even when they’re in use, reference checks are either an afterthought or a last resort most of the time. It can also mean that companies don’t want to waste time and resources until every other suspicion regarding the candidate is cleared out during the process, of course.

In either scenario, it’s apparent that reference checks are not really a priority in Japan.

In addition, another finding has revealed the popularity of outsourcing background checks to third parties is still very much alive among Japanese companies, as 30% of attending Japanese companies have stated that they outsource the process. 

On the other hand, the number of companies that have their recruitment/HR department handle background checks is slightly higher, with 39%.

On a different note, the survey also shows that 70% of the participants recognized reference checks as common practice. So, while the number of companies that actually utilize reference checks may not be as high, the results are still in line with what’s expected.

What Type of Companies Usually Do Reference Checks?

While most companies rely on their own assessment methods, there is an increase in the types of companies that perform reference checks in their hiring processes. These are mostly modern tech companies and startups that are expanding their businesses into Japan, 

As you can tell from the survey I analyzed above, statistically, foreign companies that operate in Japan rely on reference checks more than traditional Japanese companies in mid-career recruiting. However, the popularity of reference checks also changes depending on the industry.

For instance, we see reference checks being frequently utilized in the hiring processes of tech companies and tech startups. As tech companies are one of the most globalized industries in Japan, this doesn’t come as much of a surprise.

Similarly, companies from industries that are heavily regulated, such as the ones that operate in banking and finance, also seem to make use of reference checks to ensure that they meet all the requirements and regulations set by the law.

Additionally, as can be seen in the survey related to mid-career recruitment, companies also tend to utilize reference checks more often when they’re looking for candidates for managing positions. Due to these positions requiring much more experience, it’s only natural for companies to want to make the absolute best decision.

Lastly, reference checks are performed according to companies’ privacy policies. While companies that hire more foreign candidates tend to rely more on reference checks when they’re assessing candidates, but in the end, it all depends on the contents of the companies’ privacy policy and how they handle and process private information.

Top Companies That Perform Reference Checks in Japan

Now that we covered the popularity of reference checks in Japan, let’s now take a look at some of the most well-known companies in Japan that use reference checks in their hiring processes regularly.

Rakuten

Founded in 1997, Rakuten is a tech giant in Japan that’s well-known all over the world. The company operates in various industries, such as fintech, e-commerce, and communications, among others. 

Rakuten is among the largest companies that utilize reference checks in hiring. The company’s privacy policy regarding its recruitment processes clearly states that they might perform background and reference checks if they feel the need to, to evaluate the candidates’ eligibility for a given role. 

PayPay

PayPay was founded in 2018 as a fintech startup, and it’s another company that openly utilizes reference checks in its hiring processes. 

The company states in its employment agreement that it will use the information provided by the candidate to perform background and reference checks. This includes both the candidate’s educational and professional past. 

They also state that the information gathered will not only be used to make a hiring decision but will also be utilized in the candidates’ onboarding process.

Mercari

Mercari was founded in 2013 and is Japan’s first unicorn startup (a company that reaches 1 billion USD in value). The company provides the largest C2C marketplace in Japan, where users can buy and sell previously owned items.

Mercari’s privacy policy also states that they acquire information about candidates by conducting background and reference checks and that they use this information to decide whether a candidate is eligible or not.

SmartHR

Founded in 2013, SmartHR is a Tokyo-based company and another one of Japan’s unicorn startups. The company is a SaaS startup and provides an all-around HR management tool.

SmartHR is another company that performs reference checks on candidates. The company states that they use the information gathered to make sure employees fit in with the company and their respective teams and to clear out any concerns that may arise during recruitment processes.

Uzabase

Established in 2008, Uzabase is a business intelligence-focused company that provides information infrastructures to businesses. They are best known for “NewsPicks,” a personalized news app, and “SPEEDA,” a business intelligence platform.

Uzabase is also among companies that openly confirm that they perform reference checks as part of their regular hiring process. They state that they use the information gathered to prevent a cultural mismatch between the candidates and the company/teams.

Recruit

Recruit has been in business since 1960, and they are the largest recruiting company as they own well-known job platforms Glassdoor and Indeed.

Recruit is another Japanese company that openly states in its privacy policy that they collect information obtained from background and reference checks. The company says that they use this information to make decisions regarding the hiring of candidates, as well as for analyzing and improving the personnel operations at the company.

The Benefits of Reference Checks

It’s true that checking a candidate’s references is a slippery slope. 

If the candidate isn’t informed about the potential of a reference check beforehand, there may be unwanted consequences. For instance, they may end up in an awkward position with an ex-employer or an ex-colleague that they have a problematic relationship with.

However, even in the event of clear consent, for some candidates, the premise of a reference check can feel like a signal of mistrust and even an invasion of privacy. Regardless, you should remember that it’s just a regular procedure that can very well end up being beneficial for both parties in the end. 

So, before I get to the conclusion, I’d also like to name a few practical benefits of conducting reference checks that may not be apparent at first glance.

Firstly, from the company’s perspective, perhaps one of the most prominent benefits of reference checks is that it allows the company to determine whether the candidate is a good cultural fit for the company. By performing reference checks, companies can achieve a much more accurate placement in terms of teams and positions.

Secondly, reference checks can also help companies get a better picture of the candidate from a manager’s perspective. While a candidate may present themselves in a certain way, a former colleague can shine a light on certain aspects of a candidate that they themselves may not even be aware of.

Last but not least, another use for reference checks is not in the hiring stage but in the onboarding period of the candidate. Reference checks can help the company learn how an employer performs and what conditions are the best for them. This helps the company shape the onboarding process accordingly, allowing the new employee to settle in more comfortably.

Conclusion: The Popularity of Reference Checks in Japan

As you can tell by now, a simple answer to the question “Are background checks common in Japan?” is a “no.” However, this doesn’t necessarily mean that it’s not becoming more popular or that it’s less common in all candidate groups or company types.

While traditional Japanese companies historically didn’t rely on reference checks when making hiring decisions, things may be changing. 

According to the statistics, foreign companies operating in Japan rely more heavily on reference checks when hiring, and Japanese companies that operate on a global scale also seem to be adopting reference checks in their hiring processes. 

More specifically, it’s safe to say that startups, tech companies, companies recruiting for senior positions, companies that are in heavily regulated industries, and companies that hire foreign employees tend to rely on reference checks more when it comes to hiring new employees.

What’s more, while reference checks may not be so common in Japan for new hires, surveys say that a large portion of Japanese and international companies in Japan conduct reference checks for mid-career hires.

Overall, it’s safe to say that reference checks are becoming more common in Japan, especially with the overwhelming trend of globalization that’s also hugely affecting Japan. 

All in all, I think that we’ll continue to see an increase in reference checks in Japan, which is already an almost-regular practice in the tech world.

If you want to learn more about the job hunt process in Japan and are looking for a job, make sure to check out my post on job hunting in Japan before you leave.