Protect Yourself when Providing Employee References?

Reference checks are a useful way for employers to gather information about applicants that might not be discovered through the application and interview process. However, despite the usefulness of reference checking, many employers are concerned about lawsuits from former employees based on information provided in response to a request for a reference, and liability for the actions of employees where the company failed to conduct a thorough reference check. 

California is one of many states that provides immunity to employers when they provide reference material to prospective employers. This means that an employer cannot be sued for defamation, as long as the employer provides information related to job performance, qualifications, and eligibility for rehire. It does not protect statements about an employee's constitutionally protected speech or activities, nor statements about an employee's union or other concerted activities. 

An employer is protected if its statements are based on credible evidence. Employers should be careful that if they choose to provide information, the information must be truthful. The employer should not provide a glowing reference for an employee who was terminated for misconduct for example. An employer is no obligation to provide a reference for an employee, but once they chose to do so, they have a duty not to misrepresent the facts. 

Below are a few general guidelines for providing references for prior employees:

1. Maintain control of the information- limit who can give references and what information can be provided. All reference requests should go through a single person, usually an HR professional.
2. Be consistent in how requests are handled- ensure that the same process is followed for each reference request to avoid any claims of discrimination.
3. Get permission from the employee- require all job candidates to complete an application form that includes a release for employers from which they might request a reference.
4. Limit remarks to the inquiry- focus on the employee's work habits and conduct (timeliness, ability to get along with co-workers, etc.) and job performance and do not discuss the employee's personal life, marital problems, even if those personal problems affected their work performance.
5. Exercise good judgment in determining what negative information should be volunteered if the reference seeker does not ask specific questions related to an area of deficiency or poor work. Ensure that all comments are related to the job, critical to successful job performance, and critical to the performance of the job.
6. Provide truthful information- former employees certainly will have a case for claiming defamation if false information is provided. Even when providing true information, you must be cautious of the way in which it is presented. Opinions about an employee's character ("he was unmotivated and lazy") are far more susceptible to legal actions that are objective measures of job performance ("he only completed half of his assignments on time").
7. Give specific facts- instead of saying that an employee was unable to achieve deadlines, say “We had a 30-day turnaround time for completing projects, and he/she usually averaged 40 days to complete the projects.” Let the caller reach their own conclusions about the performance.

Many employers have chosen to limit the content of their communications with prospective employers to simply stating facts like:

• The dates of the worker’s employment,
• Their job title, and
• Whether they are would re-hire the employee.

Even in companies where this is the policy, there is still risk that managers will be contacted directly to provide a reference. In industries that are close-knit, it often happens that managers from one company will call a manager from another to discuss a potential candidate. This is why it is important that companies train their managers on how to provide information in a way that doesn’t expose them to defamation claims.

Lauren Sims is the article’s author and the eqHR Solutions Director of Human Resources.

Whenever you require professional Human Resources or Payroll guidance to navigate the ever-changing landscape of California and Federal Employment Laws & Regulations, contact us for a no-obligation consultation.

eqHR Solutions provides professional, tactical and strategic human resources support; ADP payroll product implementation/training and payroll processing services for businesses throughout Southern California.