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References – Still A Risky Business

A recent case has confirmed that if an employer gives a negative reference for an employee who has raised a complaint of discrimination against it, that employer will be liable for compensating the employee fully. The fact that third parties may have also acted unlawfully in refusing to employ the person will not limit the amount that the original employer has to pay.

Current case law shows that if an employer provides a reference, it must be prepared with reasonable care and be fair, accurate and not misleading. This essentially means that an employer can prepare a positive or a negative reference, providing its decision to do so is justified.

To avoid disagreements or protracted discussions with employees about the content of a reference, employers often have a policy, which is consistently applied to all staff of providing a basic factual reference. This might, for example, simply give the dates of employment and the employee’s position on leaving. Such a policy (if applied uniformly to all staff) is also useful for avoiding potential claims from the ex-employee or prospective employer if the reference is misleading in any way.

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