Employee References

As an employer, you have a right to inquire into a potential employee’s work-related background. In responding to such inquiries, it can be legal to provide both positive and negative information regarding a former employee, as reference givers are protected under the legal doctrine of “qualified privilege.” When does providing a negative reference cross the line and become illegal?

Read further for information on employee references:

1: Legality of references.

It is a misdemeanor under California law to prevent or attempt to prevent a previous employee from getting a job. If you provide false information in a reference or act in malice by knowingly spreading false information you are liable for a defamation suit. You must be able to provide verifiable examples of poor performance. You are also liable if you withhold information about a previously terminated or unqualified employee which subsequently places them in a position where they can jeopardize the safety of co-workers or third parties.

2: Your role.

How you conduct requesting a reference and providing a reference should depend on your company policy. Many employers are fearful of defamation claims which can result from providing less than favorable references. It is common practice to use limited blanket policies in order to comply with varying state law which confirm an employee’s start and end date as well as their job title.

Most companies enact liability waivers in their job applications and employee handbook agreements. You can request reference check consent forms specific to each employer reference or letter of recommendation provided by a potential new employee. I typically request all job applicants to provide me with two to three reference names of previous employers and written consent to contact each one.

Questions asked when conducting a reference check should directly relate to the job requirements and should not be general questions requiring an opinion. Although there are no legal restrictions to what prospective employers can ask your previous employers, there may be legal consequences if a hiring decision is made based on the answers. Be sure only HR professionals, payroll and benefits managers, or company owners/presidents/CEO’s have access to this information and are approved to share it with legitimate requests only.