Somebody I used to know: Should employers give references?

When someone leaves an organisation, a common question asked is – can you give me a reference?

Now and then I think of when we were together

Like when you said you felt so happy you could die

Told myself that you were right for me

But felt so lonely in your company…

Somebody I used to know by Gotye

They were happy! Why are they leaving? Once you have got over the fact that someone is leaving to go somewhere else, should an employer provide a reference? It’s often easier if they’ve been a great employee.

But what if they’ve been a terrible employee or they are leaving as a result of disciplinary action?

What are the risks of giving a reference for employers?

An incorrect or inaccurate reference can open up an employer to a claim of misleading or deceptive conduct.  For example, if your reference said that Ken was an honest, trustworthy employee and they go on to a new employer and steal from them, then your organisation may be open to a legal claim of misleading or deceptive conduct from the new employer.

Similarly, if you told the new employer that Barbie was a “difficult employee”, you could also be liable for a defamation claim, unless you could prove that what you are saying is true.

Either way, these types of legal claims are expensive, time consuming and complicated.

Is it better, in the words of Gotye, to treat them as….somebody that I used to know?

But you didn’t have to cut me off

Make out like it never happened and that we were nothing

And I don’t even need your love [reference]

But you treat me like a stranger, and that feels so rough

….

Now you’re just somebody that I used to know

Some organisations have a policy that they simply do not provide references.  They may only provide what is called a statement of service, which sets out the dates someone was employed in the organisation, their most recent role and possibly the duties and responsibilities of that role. 

This statement of service does not set out the reasons for leaving the organisation or how well they fulfilled the duties and responsibilities of their role.

This does not mean that an ex-employee cannot seek out personal references from individuals.  In fact, most employers should conduct reference checks on potential new hires, and questions should be asked if the potential hire refuses to provide the names of any senior manager in their previous employment.  In any event, a personal reference is likely to have more weight than an organisation provided reference.

If an employer chooses to provide additional information about the way an employee completed their role, or their behaviours and traits, then this should be treated with caution.  Only factual information that can be supported should be provided, to avoid the legal risks outlined above.

What happens if you are asked for a reference where an employee was fired?

This is a potentially high risk zone.  It is better not to provide a written reference in these circumstances.  Again, it is important to only provide factual information that can be supported by evidence.  If the ending of the employment was subject to a settlement deed with a confidentiality and/or a non-disparagement clause, then your hands are even further tied.  A breach of those clauses could result in litigation relating to the settlement deed.  It would be better to simply confirm the facts as outlined in the statement of service (if that was included in the settlement deed) and state that no further information will be provided.

While it might feel so rough, sometimes an employer just has to accept that a difficult ex-employee is just…somebody I used to know.

Remotely Legal can assist employers and boards on all aspects of employment law, including advising on difficult people issues, reviewing policies and assisting with enterprise bargaining.  Remotely Legal can train your boards and management teams on how to deal with incidents and investigations.  Remotely Legal can also be your fully outsourced HR and people legal team.

RL Investigations, part of Remotely Legal, are a team of highly experienced and qualified lawyers and investigators, who can function as your independent, external investigation team providing fast, comprehensive and reliable investigation reports, workplace culture reviews and suggestions for organisational improvement. RL Investigations can also help your internal HR or investigation team to improve their investigations and assist decision makers in considering the right factors when making key decisions.

This blog is general advice only.  Please obtain legal advice in relation to your specific circumstances.  This blog was written by a human so please seek permission if you wish to copy any of it.