References to ex employees – Beware when writing

In the recent case of Jackson V Liverpool City Council, the court of appeal overturned the county courts ruling that a reference had been given negligently because it contained unverifiable accusations as to the employee’s performance whilst in their employment.

Employers currently have no obligation in statute to give employees a reference when they leave their employment, unless stated in an employee’s contract of employment or further agreed as part of a compromise agreement or redundancy package.

If employers choose to make references then they undertake a duty of care to insure that the content of the reference is factually correct. If this is breached the employer will face a claim for damages from the employee. Further the reference, even if factually correct, must not mislead or give an unfair overall notion as to the employee’s worth to the new employer.

In the above mentioned case, the employer (A) made a favourable reference in writing prior to the employee starting a new position. Once the employee had left however and their workload was redistributed, it became clear that the now ex employee had not been the most up to date with his record keeping.

One year later, the same ex employee moved position again where a further reference from this Employer (B) was requested. At this point, A thought it only right to make the B aware of the issues they discovered in regards to the ex employers record keeping once they had departed. The reference stated that, had the employee remained in A’s employment they would have implemented a performance management program to address the issue.

After a further telephone conversation from B to affirm the content of the reference, A confirmed the allegations but reiterated that they had not been investigated further due to the departure of the ex employee.
 
At County Court, it was held that whilst the reference given was truthful, it was unfair and unjust as it contained unfounded and unproven weaknesses with the employees working ability, which made a presumption that the employee was not fit for employment. Had the allegations been investigated, the matter would have been concluded differently.

This decision was overturned by the court of appeal on the basis that as A had made effort to point out to B that the allegations had not been investigated. It would have been an impossible task for A to have given a truthful reference due to the questions which were required to be answered for B. It was further noted that as A had outlined what action they would have taken had they investigated the issues (that a performance management program would be implemented and not disciplinary action), was an indication as to the allegations severity.  

The Court ruled that the written reference and additional telephone conversation were to be combined as they both had a high level of important information, relevant to the reference given as a whole. They held that the overall reference was fair, true and accurate and thus no breach of contract had taken place.