Providing References for Former Employees

As an employer or manager of a team of people you will no doubt have been asked to give references for former employees. As employers, you should always strive to provide a fair representation of your former employee. If you do not take reasonable care when preparing your reference, your business could be liable for any losses suffered by your former employee as a result of your unfair reference.

Previous Employer Liable for Negligent Email to Current Employer

The case of Mr McKie serves as a reminder to all employers; always consider very carefully the information you provide about former employees, regardless of the method in which it is given. A “negligent misstatement” doesn’t have to be contained in a reference, it can be contained in any form of communication between former and current employers

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With the exception of certain roles within the Financial Services industry there is no legal requirement to provide a comprehensive reference for a departing employee, unless the contract of employment specifically entitles them to one. However, as an employer you do have a common law duty to provide a fair and true reference and you may be liable if an employee suffers loss as a result of you failing to exercise reasonable care in the preparation of the reference. You may also be liable if the reference is misleading or unfair overall, even if the content is factually correct.

The points to remember when writing a reference are:-

  • Only answer the questions asked
  • Be factual – make sure what you say is true, accurate and a fair representation of the person
  • Do not include opinions
  • General Data Protection Regulations – once the employee starts working for the new employer, they may be able to gain access to the reference.

Careless References References for Former Employees

For years employers could only be sued by former employees for libel, discrimination or defamation of character and the ex-employee had to prove not only that the reference was false, but also that it was made maliciously i.e. not knowing or caring whether it was true. But in 1994 in Spring v Guardian Assurance the House of Lords ruled that employers should be liable for references which were compiled carelessly. Since then, employers have had to pay out damages, often amounting to the equivalent of a year’s salary, for negligent references.

On the other hand, you should avoid giving a good reference for an employee whose performance or conduct was unsatisfactory, because this could weaken your case in any claim for unfair dismissal and the new employer could claim damages if the employee proves unsatisfactory and material information was omitted from the reference.

All requests for references should be treated equally and the content should be given careful consideration.

What is the New Employer Looking For?

When an employee is changing jobs the quality of their competence in the job, they did for you will be of little relevance to the new employer as they will have carried out their own assessment of the candidate to ensure that their skills match the position on offer. However, they will be looking for verification of the information which the employee has provided to them such as:-

  • Length of service
  • Position held
  • Salary at date of leaving
  • Honesty and integrity
  • Time keeping
  • Reason for leaving

The reference should be true, accurate and fair, though it does not need to be full and comprehensive. It is increasingly common merely to provide a standard response to references that covers the above points. If you decide to adopt this approach you must apply the rule to all employees and you should inform them that this is your company policy, this could be done with a brief mention in the employee handbook.

Potential employers may also ask for your comments on the applicant’s suitability for the post on offer and personal attributes. It is in these sections of the reference that you can write or speak positively about the applicant, if you so wish. When doing this you should make sure that the information provided is relevant, for example include only comments that are directly related to the position they fill rather than personal comments. Look upon the reference as a review of their time with your company.

What About Negative References?

If you find yourself in the position of having to provide a negative reference you should approach the task with extreme caution. It is unlikely that an employee will request a reference from an employer who was dissatisfied with their work standards but some potential employers will check out a candidate’s backgrounds thoroughly. If you find yourself in this position you are recommended to stick to the following guidelines:-

  • Remember that you are under no obligation to provide a reference, verbally or in writing
  • Stick to only those facts that you can verify
  • If asked directly for opinions, make absolutely sure that you have the facts to back them up

A disclaimer at the end of reference does not constitute a ‘get out of jail’ clause. The courts will not give any protection to an employer no matter how well drafted the disclaimer if the reference is inaccurate and misleading.

Finally, ensure that all employees who provide references on behalf of the Company understand the relevant legal principles and issue guidelines on good practice.

General Data Protection Regulations

The Regulations protect the provider in that the employee has no write to view any reference provided about them. However, the recipient is not protected in the same way and the employee could use the Regulations to extract a copy. The Commissioner states that those asked to provide references should not be led to believe, and cannot expect, that their references will be kept confidential in all circumstances. It should be assumed therefore that the subject will see the reference. Thus, inflammatory or sarcastic comments should be avoided.

If the data on which the reference is compiled is inaccurate then that may give rise to a claim for compensation by the individual.

Top Tips to Writing a Reference

  • Only answer the questions asked
  • Be factual – make sure what you say is true, accurate and a fair representation of the person
  • Do not include opinions
  • Avoid providing verbal references – they are open to interpretation!
  • Data Protection Act (DPA)
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The References for Ex-employees folder provides guidance and resources to help you provide references for ex employees. I also provide a template letter to help you provide a basic response to a request for a reference.

References for Former Employees

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