Don’t tiptoe around issue of job references

Providing a reference is a triple-edged sword.

An employer refusing to furnish a well-deserved reference to a departing employee may be found to be acting in bad faith. Additional damages in an action for wrongful dismissal can be awarded, in such an instance. These damages can escalate even further should the court determine that a reference would have enhanced the employee’s prospects of re-employment.

At the same time, a reference can effectively undercut an employer’s ability to assert just cause. Picture the typical case of an employee who is fired for poor performance and, in turn, sues for wrongful dismissal. The employer’s defence cites various instances of the employee’s inadequacies.

Professing shock at the employer’s allegations, the employee produces her supervisor’s letter commending her performance in the very areas impugned by the employer. Called to account for the approbation, the supervisor explains that she was simply responding to a human request for assistance. The employer is now left with an unpalatable dilemma: Either abandon the allegations of cause and lose or press on with the supervisor as its chief witness having to now explain, under oath, that she did not really mean what she put in writing. Hardly a recipe for victory at trial!

The third prong of this conundrum is seen in the case of the employer who issues a glowing reference. It intentionally omits, however, a significant feature of the employee’s history — such as the fact he was terminated for theft. If the employee is hired in reliance upon that incomplete reference and repeats the same offence, the employer can be sued for negligent non-disclosure.

Facing the grim prospect of lawsuits, whether or not they supply a reference, many Canadian employers resort to skeletal “name, rank, serial number” responses, listing only the employee’s position and dates of employment. In reality, employers need not be so reticent.

When Charles Moore, the vice-principal of a Windsor vocational high school, commented about one of his teachers, Katherine Korach, to the school board superintendent, he minced no words. Outraged by his conclusion that she should be transferred to a regular school where she would be less likely to encounter difficulties with her students, Korach sued Moore for defamation.

Although Moore’s statements were found to be false and damaging to her reputation, Korach still did not succeed. To recover damages for defamation, Korach had to demonstrate that the reference was not only false but malicious. The only issue was whether Moore honestly believed what he stated. If he did, Korach would lose. Evaluations by employers of their employees, ruled the Ontario Court of Appeal, should not be inhibited by “libel chill.”

Bare-bone confirmations of employment, without any references to quality of performance, are unfair to hard-working employees who often need recommendations reflecting their accomplishments to advance their careers. They are also counter-productive: If an employee knows that her reference will be the same regardless of her achievements, it is a disincentive to excel. As well, companies refusing to provide employee references often remove themselves from the information flow among employers. The price they pay is the inability to obtain candid information that they require from industry peers to avoid hiring mistakes.

What should employers do?

1. Designate one person to vet and issue all references;

2. Prohibit line supervisors and managers from issuing references;

3. Ensure that references accurately reflect an employee’s record;

4. Avoid giving references when cause is being asserted;

5. Furnish fulsome references detailing an employee’s accomplishments and conversely, any significant problems;

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If you, or someone you care about, is dealing with employment law issues in the Toronto, Ontario Region, contact Lang Michener LLP.

This article is taken from an interview with Howard A. Levitt,Employment Lawyer at Lang Michener LLP, a Toronto, Ontario Employment Law Firm. Note that laws vary from province to province. Please consult with a lawyer in your own area to be sure of the laws and specific issues in your own jurisdiction.