There is no general legal obligation to provide employee references or for former employees. You should however ensure that you have a consistent policy to avoid any allegation of discrimination.
It may also be a contractual requirement to provide Employee References if referred to in the employees contract of employment or as part of a Compromise Agreement.
Employers are under a duty of care when compiling a reference. The reference must be based on accurate information. If the subject of a reference suffers as result of the negligent misstatement made by the employer then he or she will have grounds to sue in negligence. If the subject of the reference is defamed either in writing or orally and the employee suffers loss as a consequence and the employer knows that the reference is untrue or is given with malice then there maybe a prospect of an action in malicious falsehood.
It is very difficult to bring a defamation claim in relation to employee references. Such a reference is protected by qualified privilege. An employee cannot successfully sue for defamation with regards to the contents of a reference (even if untrue) if the employer believed that the information in the reference was correct and it was provided without malice.
So what are the options?
- Don’t give employee references – You can refuse to give a reference however be mindful that a failure to do so could suggest that you have had problems with the employee or could give rise to a claim for discrimination.You could simply give the bare facts stating the employees’ position, salary, sickness records and state that this is your policy only to give such a reference so that the new employer does not read anything into the fact that you have not provided a more comprehensive reference.
Give a full reference – This can include the bare facts as above then detail the employees’ performance and qualities etc. you have a duty to be fair and accurate and true which means that you should not refuse to answer specific questions unless you explain why, omit key information that a new employer would expect you to disclose or present the information in such a way that it would give the wrong impression of the employee.
A final point to consider is liability to any future employer. If you provide an inaccurate reference and the new employer relies on it then you could also face an action for negligent misstatement from the new employer.