Should You Disclose an Ex-Employee's Improper Conduct? - In House
In House - The FindLaw Corporate Counsel Blog

Should You Disclose an Ex-Employee's Improper Conduct?

Providing an employment reference for a former employee is always a sticky situation. If the person responding to the request discloses too much information, the employer can end up being sued for defamation or tortious interference with prospective business relations.

But what if that person has disclosed too little information? What if the reference request is for a dangerous former employee? Is human resources obligated to disclose violent or other improper conduct?

Quite possibly yes.

This type of litigation is becoming more common, according to Inside Counsel. Companies are suing when they realize past employers weren't completely honest about dangerous former employees.

The theory, often one of negligent misrepresentation, is receiving mixed results across the country. In a 1997 case, the California Supreme Court held an employer liable when a former employee sexually assaulted a student. The school district knew of past improprieties, but unqualifiedly recommended him for the job.

The panel ruled that a referrer has a duty not to misrepresent facts about a former employee.

In 2008, the 5th Circuit, speaking only to Louisiana law, agreed, but one with caveat. An employer who chooses to do more than just verify past employment must respond truthfully.

Even with a handful of these decisions, employers are still a bit reluctant to discuss a dangerous former employee. They may not have to be. At least 3/4 of states have enacted laws granting employers job reference immunity. No defamation, tortious interference or misrepresentation suits as long as the job-related information is truthful.

Maybe it's time to change company policy?

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