Many employers worry that if they fail to provide a dismissed
employee with a deserved reference, additional damages could
follow. That concern is not without warrant, but careful thought
should go into writing that reference.
If the lack of a reference leads to longer unemployment, the
courts often compensate the employee for that. As well, courts,
either expressly or otherwise, sometimes punish employers for
refusing to provide a reference to an employee deserving of one.
Quite practically, employers also realize, if the reference results
in quicker re-employment, there will be less potential damages for
the former employee to sue for.
For all of these reasons — some well-intentioned, others
less so — employers often dash off letters of reference to
employees, deserving or not, with little thought, hesitancy or
But the rise of negligent referencing and defamation claims in
the United States and Britain in recent years is causing some to
readjust their way of thinking.
Canadian employers need to be beware of the some of the
pitfalls. If, for example, you deliberately make a false statement
about a dismissed employee that negatively affects his or her
reputation or re-employability, you may have defamed the employee
and be liable for damages. However, proving your comment was
deliberate can be difficult. Unlike their U.S. counterparts,
Canadian employers are protected from defamation arising from
references and employee evalutions if they honestly believe their
statement to be true.
That may be why, while some employers are too quick to dash off
references, others are too reluctant. This is particularly the case
with U.S. subsidiaries whose practises are informed by those south
of the border.
The larger risk for Canadian employers is negligent
misrepresentation. If a prospective new employer relies upon a
favourable letter of reference that was negligently drafted and
inaccurate, they may look to recover damages. Employers should
never provide a reference for employees fired for cause. Similarly,
although not liable for defamation, if an employer's reference
is provided negligently, with little forethought or care, and the
employee loses a job as result, they may have a suit against the
If you have fired an employee for cause, beware of receiving
reference calls from purported new employers seeking positive
references. Such calls are generally not for the purpose of a job,
but to make it difficult for the employer to later maintain, even
justified, allegations of cause based on incompetence or
misconduct. Your goodwill should never entrap your reason or
Employers providing references for a dismissed employee would be
wise to heed the following:
Be honest in drafting reference letters and do not act with
malice or the intent of interfering with the employee's ability
to find a new job. This will protect you from a defamation
Obtain consent from the former employee to provide a letter of
reference and to answer reference related questions from a
prospective employer. Establish the boundaries and don't go
Generally avoid negative comments although there is no legal
liability if what you say is accurate, balanced and
Do not endorse (and enact a policy ensuring management does not
endorse) employees through social media sites or otherwise when a
former employee is dismissed for cause.
Have a policy prohibiting references being provided by anyone
except a designated individual who will review the file and
consult, as necessary before doing so.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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