Employers naturally want to find out as much as they can about potential hires—after all, they’re going to invest a lot of time and money in onboarding and training. But references—both providing and obtaining them—can result in sticky situations.
Oftentimes, employers are reluctant to provide full and truthful references (especially negative ones) because they consider the legal risk too great. No company wants to be sued for defamation or retaliation. However, there are also risks to remaining silent, for example, not disclosing a former employee’s propensity toward violence or sexual harassment. So what’s an employer to do?
Some states do have laws that provide for employer immunity from claims by former employees that they were denied employment because of a negative reference, and there are certain federal and state laws that require the release of certain information (such as pertaining to motor carriers). Those possible protections aside, we have some tips for your HR staff on how to handle reference requests from prospective employers.
Best Practices for Providing References
Whether your state has a reference immunity law or not, the recommended practice is to establish a specific routine for handling requests for references on former employees. Some basic rules to consider include the following:
- Only provide employment references on written request.
- Clearly define in written policies and training materials exactly who in the organization has authority to give references, and who does not. Inform employees that if anyone who is not authorized to give references does so, he or she will be subject to discipline.
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- If direct supervisors are authorized to give references, they should be given specific guidelines to follow, including that the references be in writing and that a copy be sent to the human resources department. As a practical matter, it is difficult to keep supervisors from providing references for highly regarded former employees. Therefore, permitting and regulating such references will likely better serve the employer’s interest than prohibiting supervisors from providing references altogether.
- Include in reference guidelines an explicit prohibition against mentioning anything about the physical or mental characteristics or the personal life of the former employee.
- Reference information should be provided in response to a specific question from the prospective employer. Individuals providing references should not simply volunteer information unless it is responsive to a question.
- Information provided in response to a request for reference should be factual, verifiable, and accurate.
Note: Individuals who have been denied employment and believe it may be the result of a negative reference from a former employer may hire a background checking service to find out what the former employer said about him or her. Therefore, when a reference checking service calls to check the references of a former employee on behalf of a “client,” keep in mind that the “client” might well be the former employee.
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Beware!
Employers should not release pay information over the phone or to an employee’s creditors unless the employee consents to disclosure in writing. Moreover, under the Fair Credit Reporting Act (FCRA), commercial collection agencies are prohibited from contacting employers except to verify the location of the debtor, and they may not mention the debt.
In tomorrow’s Advisor, we’ll provide a few tips for asking after references for prospective employees.