Can You Sue Your Former Employer For Giving A Negative Reference?

It is less and less common for an employee to spend his entire working career with one employer. In order to build a more impressive resumé and develop a greater skill set, it is not uncommon to find employees spending several years with one employer, then moving on to other opportunities, and repeating the process several years later.

Yet, the success of this kind of career plan depends on being able to obtain favourable references from former employers. The trouble is that it is not guaranteed that a former employer will provide a positive reference to a subsequent prospective employer. There is always the risk that the former employer might give the prospective employer a negative description of the employee’s abilities and work ethic.

The decision of the Divisional Court in Papp v. Stokes is an instance where a former employer provided a negative reference to a prospective employer and was sued by the employee as a result. In this case, the employee was let go due to a shortage of work. His former employer agreed to act as a reference for him, but later learned of performance issues with the employee.

When a prospective employer contacted the former employer about a reference, the former employer mentioned concerns about the employee not working well with others on his team, but still emphasized the employee’s technical proficiency. As a result of this reference, the prospective employer chose not to hire the employee. After learning of this, the employee sued the former employer for defamation and infliction of mental distress.

At trial, the employee’s claim was dismissed on the basis that what the former employer said about the employee was substantially true and that the reference was not motivated by malice. The employee appealed the decision, but the Divisional Court saw no reason to interfere with the trial judge’s findings and upheld the lower court ruling.

The takeaway from this case is that a negative reference given by a former employer will not give rise to a claim for defamation if the content of the reference is accurate and is not made with malicious intent. However, as alluded to by the Divisional Court in its reasons, employers should be careful about agreeing to provide a reference to a former employee, only to later cast that employee in a negative light. Doing so could potentially give rise to a claim for negligent or intentional misrepresentation.

This article is intended only to provide general information and does not constitute legal advice. Should you require advice specific to your situation, please feel free to contact me to discuss the matter further.