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If it hasn't already happened, there will come a day when you receive a phone call requesting an employment reference for a fired employee. The request will undoubtedly put you in a difficult position.
You're probably aware that a bad reference can turn into a defamation or tortious interference lawsuit. But did you know that not telling the truth can also get you in a little bit of legal trouble?
Well, it can. You can be held liable under the tort of negligent misrepresentation.
Employers are increasingly being sued for failing to disclose a former employee's improper behavior . In order to avoid a defamation suit, an employer will provide a positive reference for a fired employee. But when that employee repeats the offending actions, the old employer suddenly finds himself under legal scrutiny.
A number of these lawsuits have been successful. The California Supreme Court ruled that a referrer has a duty not to misrepresent facts about a former employee. This means California employers cannot give a raving review when an employee was fired for stealing.
Some courts only apply this rule when a reference does more than just verify dates of employment. Only those employers who discuss job performance are liable.
The possibility of a negligent misrepresentation lawsuit should make you extra careful when providing a reference for a fired employee. You'll need to choose your words carefully, so as not cross the line into defamation territory. There's a fine line between disclosing too much and too little.
Talk with an attorney about where that line rests within your jurisdiction. It's always better to be prepared before someone requests a reference for a fired employee.