THE LIABILITY OF EMPLOYERS FOR REFERENCES

The Liability of Employers for References

Introduction

Employers should exercise care when providing job references for current or previous employees to potential new employers. A current or former employee may have a cause of action for a defamation lawsuit if the previous employer recklessly or maliciously makes a false statement about the employee to the potential new employer asking for the job reference (Gaal, 1999, p. 8).

When a prospective employer sends a written request for a job reference, the employer may respond in writing to the request without fear of civil liability and may disclose written employee evaluations signed by the employee; official personnel notices that formally record the reason(s) for separation, whether the employee was voluntarily or involuntarily released from service and the reason(s) for the separation, and information about the employee's job performance (Stokes, 2000, p. 11).

Successful negligence claims for false references in the UK

In England, it has been accepted since the mid-1990s that an employer owes a duty of care to an employee to take reasonable care in preparing a reference (Harshman & Chachere, 2000, p. 29-39). Any breach of this duty entitles the employee to compensation in negligence. This can mean that the employer needs to pay for the economic loss the employee has suffered by not selected for a job or sacked from a current job (Little & Sipes, 2000, p. 1-8).

The existence of this duty has recently been affirmed and extended in McKie v Swindon College [2011] EWHC 469. This case concerned a former employer making blatantly false and damaging statements about a former employee to his new employer, resulting in the new employer terminating the employee (Lee, 2011, p. 1-2).

Although the court acknowledged that these statements were not given in a reference, it found that a former employer may be liable for damages in negligence to an employee as a result of any communications with a future or current employer about the employee.

The Data Protection Act 1998 provides an exemption for confidential references given or to be given by a data controller for specified purposes, including education, employment or training, from subject access. However, this does not apply when the data controller is the recipient of the reference. Therefore, a reference written by an employee of the University and stored in a relevant filing system would not be accessible to the data subject (the individual about whom the reference was written) if they sought access via the University. If, however, they sought access from the recipient, i.e. a potential employer, the reference may be accessible under the Act. This clearly also applies where the University receives references from external sources, such as previous employers and head teachers. This applies even when the reference is marked confidential.

If a data controller is a recipient of reference and a data subject seeks rights to that reference under the Act, the data controller must determine whether the referee intended the reference to remain confidential. If the referee did not intend the reference to remain confidential ...