To give or not to give, that is often the question. Employment references can present legal risks for employers. Former employees and their subsequent employers may allege claims of negligence in the provision of references. In Canada negligent referencing has yet to be addressed definitively by the courts. However, in the United Kingdom, claims that an employer was negligent in providing a reference have arisen in two main factual scenarios:
- Where a former employee alleges that a former employer’s reference contained inaccurate or misleading statements. Due to their failure to take reasonable care, the employee claims to have experienced a loss.
- Where a subsequent employer claims that they have experienced a loss because they relied on a favourable reference given by an employee’s former employer that turned out to be inaccurate or misleading.
The UK House of Lords addressed the employment reference two decades ago, recognizing the adverse effects a reference can ultimately have on the life of an individual. In Spring v. Guardian Assurance it was held that employers must take reasonable care to avoid giving inaccurate or misleading references. Such cases could inform the approach in Canada. The law of defamation provides employees in Canada with yet another avenue to recover damages. Where an employee can show that the employer’s hand was led by malice or ill will, liability may ensue on employers. Human rights considerations are also pertinent. Employers must be wary of any comments relating to protected grounds of discrimination, tensions and personal vendettas held by the referee, and making statements without a solid factual foundation to support them.
Employers would be well advised to develop policies that are applied equally. The provision of references should be entrusted to a specific individual who is knowledgeable of the issue and risks involved. Some employers may choose to only provide letters confirming facts of employment with no additional comments. The goal is to adopt best practices and avoid the potential for liability to ensure after employment has long ended.