Word of Mouth "references"

CEJ

Our employment setting is a small post-secondary institution. Many of our job applicants are past students. The question has come up as to whether faculty and/or staff (who the hiring supervisor knows has had classroom or work experiences with) can be approached as to their individual experiences with the applicants. Thus, they would not be formal listed references. At times it has happened that info about an applicant has been freely given by someone (e.g. a past work-study supervisor) without the info having even been solicited by the supervisor -- just word of mouth. The individual had a poor experience with the applicant, heard that he/she was applying and wanted to share their experience (sometimes negative) to the benefit of the hiring supervisor. How do others handle the topic of word of mouth and informal references. Is there liability if this info is used in decision-making? Obviously, it can be valuable information if handled with caution, but I also know this is a touchy topic. Any info, suggestions, or experiences?