News & Views

Employment References: Worth the paper they are written on?

How many times have you, as a prospective employer, sought employment references from an individual’s ex-employer and either not received a reply or, more commonly, received a reference which contains no meaningful information about the individual concerned?  Employment lawyer Mark Fellows explains why this trend has emerged and provides tips on approaches prospective and previous employers can take.

The ‘standard’ reference

Over recent years, there has been an increasing trend of employers issuing standard employment references. A standard reference merely confirms the individual’s dates of employment and job title. It omits the reason why the employment ended, which of course is usually one of the most important pieces of information a prospective employer is seeking.

There will usually be a disclaimer at the bottom of the reference saying that no reliance can be placed on it, but this raises the separate question as to how any prospective employer can rely on a reference that actually, in reality, tells you very little.

Although standard employment references are very prevalent, we still do see the odd bespoke reference which will include a lot more information than a standard reference, including possibly the duties that the individual undertook during their employment and, in some cases, it will comment on how well those duties were performed. The bespoke reference may also confirm the individual’s salary, and give the reason for the employment ending.

Ironically, as bespoke references are so rare these days, when a positive bespoke reference is issued, it can often cause a prospective employer to question why the individual has been able to obtain such a glowing reference in circumstances where most employers are only prepared to issue a standard reference. Indeed, it is the case that some employees will negotiate a positive bespoke reference as part of a settlement, following a dispute with their employer, so there may be a good reason to be suspicious!

Why have ‘standard’ employment references become, well, standard?

We suspect this is indicative of the compensation culture in which we now live and the fear on the part of the ex-employer that if they do say anything bespoke about the employee, it could come back to bite them:

  • If they give a positive reference about the ex-employee, which the prospective employer relies upon, the prospective employer may claim against the ex-employer for misrepresenting the situation if the individual turns out to be unsuitable; or
  • If the reference is negative, and the ex-employee does not get the job as a consequence, he may sue his ex-employer for scuppering his chances of obtaining new employment.

For those reasons, employers these days tend to have a policy of providing only standard references.

Is there anything you can do?

If you receive a standard reference, you as a prospective employer can still make further enquiries with the ex-employer notwithstanding the standard reference. You might even contact the referee by telephone to see if you can elicit any further information from them beyond the written reference. Occasionally, the referee will not be able to resist the urge to be candid, possibly on the basis that they believe that there are unlikely to be any consequences given their comments are not in writing.

However, if the ex-employer refuses to provide any further information beyond the standard reference, then there is very little that you can do about it from a legal perspective. There is actually no legal obligation on an ex-employer to provide any meaningful information about the ex-employee to a prospective employer and, as a general rule, no obligation to provide a reference at all.

It may well be necessary to look at the wider picture. If an ex-employer refuses to provide a reference at all (which is rare), could that be indicative of a concern? The length of the individual’s employment (when read in conjunction with their overall employment history) may also provide a helpful insight? A long period of employment with the ex-employer is often a good sign, particularly when compared with an individual who has moved regularly from job to job.

We would also recommend you place greater emphasis on matters such as your recruitment process, and ways in which you can improve the way you measure suitability. A standardised induction process and regular performance reviews, perhaps alongside a structured probationary period, will also enable you to identify any concerns at an earlier stage.

What if you are issuing employment references on behalf of an ex-employee?

Of course, you may equally be the ex-employer issuing employment references to a prospective employer. You may have a policy of issuing only standard references too, and that is certainly the most risk averse approach. However, if you do feel inclined to give a bespoke reference on behalf of an ex-employee, the key is to ensure that it is factually accurate, and not misleading to anybody who might seek to rely upon it.

You may also want to ensure that there is an internal process in place for dealing with reference requests so that only designated employees (usually HR) have the authority to issue a reference on behalf of the Company.

For more information

Please contact our expert employment solicitors Mark Fellows or Joanne Perry.

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