CEDR Two Minute Trainer: Reference Request Responses

Employee Reference Check Form

Although the riskiest time for an employer is at the moment of termination, the dangers don’t end there. It may seem like a nice thing to do, and an easy one, to provide a letter of reference when sending an employee on their way, but this causes a potentially huge risk: If the employee comes back with a claim against you, and you have to prove you fired them for a legitimate business reason, they now have your glowing letter of reference to discredit your sole defense. If you get nothing else from this trainer, get this – do not give letters of reference.

So, what do you do when prospective employers call about your ex-employees, good or bad? Most managers clam up, and rightly so, given the potential legal repercussions. But not saying anything does not absolve the company from risk. What should you say? How much detail should you give? Say too much, and you risk the employee suing for defamation or retaliation. Say too little, and you risk the employee suing for implying negative information by your silence.

Give just a bit of information, and you may trigger the duty to fully disclose, and risk the prospective employer suing you for failing to disclose important information. (The idea here is that failure to disclose serious misconduct could also trigger liability, if the employee goes on to injure someone at his or her new workplace – which then claims they would never have hired this person had you revealed the full truth.)

Finally, how do you balance the need for self-protection, and the concomitant desire for the person to become employed again to get them off your unemployment roster, against any compulsion to kindly warn your colleagues of dangerously bad apples?

Using a “Reference Release Form”

The easiest answer is to require use of this reference check consent form (Reference Check – Former Employee Consent) before giving a reference on any ex-employee. When signed by the departing or ex-employee, this document releases you from liability for TRUE statements that you make to prospective employers regarding the ex-employee’s employment record, disciplinary history, salary, hours worked, and performance of their job. Essentially, the employee is giving you permission to speak freely about their employment with you to their future employers.

To insulate your business from liability, your best practice is to obtain the departing employee’s signed release before they leave. If you are unable to get this in advance, you can still request it when someone calls you for information about the employee. When someone calls you for a reference, you need to be brief, and stick to a standard written policy to only give out the bare minimum of information – dates of employment, position and salary. This policy should be in your handbook and all managers should be trained on it. You can stop after just giving this limited information if you wish. Or, you can tell the requester that you are happy to provide more information, but only if the applicant (your ex-employee) signs a release. If, and only if, you receive the form with the ex-employee’s signature, should you give additional information.

What Information Should You Provide?

You always want to keep your responses truthful and supportable by documented evidence, such as the employee’s personnel file or attendance records. For example, you might say “Joe failed a drug test.” Or “Joe was disciplined on several occasions for unprofessional communication with other employees.” Stick to work-related facts, and stay away from commenting on the person’s personal information. Never give information about a person’s medical history or other protected health information.

Some states grant a qualified privilege (i.e., a limited immunity) to employers who give information about ex-employees that is factual and given in good faith. But these waters are muddy and best avoided. While, generally, it is fine to provide an assessment of the person’s skills or suitability for a particular job, be clear when expressing your opinion that it is in fact an opinion. Though opinions cannot be considered to be defamatory, they can easily be confused with or construed as facts, and thus become actionable. For example, “I think Joe was a jerk to work with” is pretty clearly an opinion. On the other hand, “I believe Joe couldn’t control his temper,” could be either fact or opinion, and thus is sufficient to make a claim out of. Finally, avoid making characterizations. For example, say, “Joe was late 10 times in two years.” Don’t say, “Joe was lazy.”

Flip this Strategy When Checking Your Own New Hires!

The flip side of this situation is when you are hiring a new employee. Now you are tasked with investigating their background and confirming the information they provided to you while applying and interviewing for the position. Using a background check company is always prudent to check the criminal history of candidates once you make an offer, but a personal call to their last employer can be far more revealing.

To get through the reluctance of other employers to speak freely, be proactive and get your applicants to sign a Reference Check – Applicant Consent, which gives their former employers permission to speak freely to you. They have the option of whether to include their current employer in the consent. Giving a signed consent form to that past employer tends to make them more likely to provide truthful information. CEDR provides a form (Reference Check – Short Form) to record the information you receive from each prior employer, and a longer form option that includes a script for what to ask. (Reference Check – Long Form with Script).

These forms and tips will keep your hiring and post-firing actions stress-free. As always, if you have questions, give our CEDR Solutions Center Advisors a call at 866-414-6056!

Three Things You Can Take Away:

1. Never give a written letter of reference.
2. Get a signed release and waiver from the employee before giving or asking for an employment reference.
3. When giving a reference, stick to the facts that can be supported by documents. Avoid giving opinions.

Have questions about a reference request or any other issue as it applies to your practice? Don’t hesitate to call a CEDR advisor at 866-414-6056 with any further questions.