Most human resource managers today are limited to providing only the basics for employment verification.  Fear of litigation nullifies anything that may be deemed subjective or, more considerably, litigious.   Conducting the formal employment verification will typically return little more than the date your candidate started employment, the date he left, and the position he held.  You will often find yourself lacking the input needed to make an informed hiring decision.  Once in awhile, the HR Manager will be adventurous and respond that your candidate was "in good standing."
In fact, at the writing of this article, there was a radio program where the show's commentator reinforced this principle.   The commentator admonished Human Resources Personnel that there is as much a danger in providing a positive reference as there is in providing one that is negative.   He went on to say it is important to keep all employment verifications as uniform as possible.   He suggested providing only the start date, completion date and the position held.
Is this bare bones information enough to make an informed decision on an employment candidate?   Sometimes.  When the job is simple enough and no special skills are required... yes. Then all you need to know is whether or not your candidate actually worked at his previous place of employment.    You may need to know more about an IT candidate's technical skills, but whether or not your candidate's last job as a pizza boy can shed any real light on his abilities is open to debate.
Because the typical employment verification yields such sparse information, more and more businesses are turning to the reference verification in order to find out more about their candidates and their respective skills.  While the reference verification can have its pros and cons, for a fair number of hiring situations it's a smart way to go.   
Reference verifications can be best used to discern the skill sets of your job candidate.  Recruiters will employ the reference check to determine if their candidates are qualified in special skills and experience.   You may call upon references to define a job candidate's level of IT skills, or his fluency with general and industry specific software programs.   You may wish to better understand his abilities in graphic and web design, which can provide essential considerations.   
As a recruiter, you may want to know more about your candidate's networking capabilities, who he knows in his industrial sector.   If he is a sales person, you may know just how well connected he is in, say, licensing product in certain geographic regions.  For international candidates, when language capability is a concern, you can use the reference verification to help assess these abilities.
Of course, there are other questions you may ask in your reference verification process.  You may want to know more about your candidate's management skills or style.  You need to determine if he works well with others, if he is a team player or the sort that works better off by himself.  Does he show up on time?  Is he absent frequently?  What are the areas where he can improve?
At Corra, as part of the verification process, we ask the reference to rate the employment candidate using a scale of one to ten.  Ten is the highest score.  Usually, to be considered a viable employment candidate, our clients would like to see at least a seven rating.   Seven and up is considered pretty solid.
Sometimes the reference gets carried away and barks out a ten.   Most employers will look at this as boosterish.  But there are the exceptions.  If the reference is an upper level executive and qualifies his or her statement with such phrases as "I've been around for umpteen years and rarely have I seen someone work as well as So and So," the employer will take it more at face value. 
In most cases, the higher level ratings are a nine or nine plus.   The reference will often qualify his rating with "Everyone has room to improve..."
Always bear in mind the reference that your job candidate supplies you, will be a favorable reference.   No candidate in his right mind would give you references that would go out of their way to sink his ship.   Sometimes the reference may not find the candidate as favorable as the candidate would like to believe.  While the reference wants to be a good person, they may also want to divulge the more negative aspects as well.  There is any number of reasons for doing so.   Sometimes they wish to give you a heads up.  Sometimes there are personal issues.   Sometimes they are just covering their butts.
The reference may not tell you directly that the candidate is tough to deal with or is someone who they would never hire again.   Yet they would like to.  So it is not the answer itself, but the way they answer that serves as the indicator.   It's what they don't say or their hesitation that provides the tipoff they were less than thrilled with your candidate.   
Listen for the speech inflection, the hesitation, or the reference's struggle to find the right word or term.   Sometimes they are working so hard at being diplomatic you can glean a more negative appraisal.  Sometimes, if prodded, they will tell you a little more about the downside of your candidate.   Sometimes that won't veer from the positive appraisal, but while they don't say it outright, there is something in the way they answer that can tell you more than they had wished.   Or, they told you exactly what they wanted to say, but with plausible deniability.
It should be noted for the rare but embarrassing occasion that when you get a reference contact information, make sure they are a legitimate source.   Either insist on the business phone number as well as their cell number, or find some way to substantiate that the reference isn't your candidate's cousin Larry pretending he is the former CEO of Nonexistent Enterprises ready to give your candidate a really great review.  Think it doesn't happen?  Think again.   But then you might weigh your candidate's penchant for duplicity against his daring and creative thinking.  Just kidding.
Here are some of the questions, you may wish to use when conducting reference verifications—
Date:
Candidate name:
Reference name:
Reference Title/Company:
Company where they worked together:
Relation to Candidate:
Reference Phone:
Confirm Candidate's Title and Dates of Employment:
1)   Did the candidate report directly to you?
If not, what was your working relationship?
2)   What were this person's main responsibilities?
3)   a. What are this person's strengths?
b. What are some areas in which this person can improve?
4)   How does this person work with others?
5)   In what ways does he/she respond to stressful (high pressure) situations?
6)   Did he/she ever have a problem with tardiness or absenteeism?
7)   What advice would you give his/her future manager in working with, and motivating this person?
   Would you rehire this person?  If not, why?
9)   On a scale of 1 to 10 (10 being best), how would you rate this person's overall performance?
10)   Do you have any additional comments that you feel would be helpful?
Of course there are variations upon the theme, so you can be resourceful in choosing reference questions to fit your company's particular needs.   Be uniform in composing these questions.  Otherwise, it becomes a cumbersome process, and you can risk driving your researcher crazy.  There is also the issue of fairness and how it affects the rules governing employment law.  So be consistent.
Reference verifications can be a great tool for the pre-employment screening process. It can be an effective background check, when you use it wisely.