by Mindy Chapman, Esq.

We’ve all picked up the phone and been asked to give a reference about a former employee. For some, you’re glad they are out of your hair and it’s too late for them to sue you. So you’re honest about the person.

But be careful. As a new case shows, it may never be too late for a former employee to take you to court …

Case in Point:
Bernadine Matthews departed Wisconsin Gas on bad terms after 20 years. She agreed to a settlement agreement that specified how the company should respond to future reference checks.

The settlement required the company to follow a script, “At this time, the company’s policy is to … confirm people worked here, the dates of employment and their last position.”

After Matthews left, the company received three reference calls. On two occasions, supervisors initially denied Matthews ever worked there and then gave out the agreed-upon information. On a third occasion, the company lawyer also added that Matthews was involved in ongoing litigation with the company.

Matthews sued Wisconsin Gas, claiming the company breached the contract and retaliated against her.

The appellate court sided with Matthews and sent the case to a jury trial, saying Matthews’ prospects for a future job had been damaged by the additional comments made during the reference check. (Matthews v. Wisconsin Energy Corp., E.D. Wis.)

3 lessons learned

1. Dust off your reference-check policy. Know what your organization’s reference-check policy limits you and your supervisors to say—then stick to it. No extraneous comments or you could create a lawsuit.

2. If you don’t have a policy, implement one. It’s too risky today not to have a reference-check policy in place to limit your liability.

3. Train everyone on it.
Make sure everyone knows your company’s policy so they can comply. Reference-check calls don’t always go to HR, so employees need to know where to reroute the calls and what not to say before they forward them.
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Author: Mindy Chapman is an attorney and  president of Mindy Chapman & Associates LLC. She is a master trainer, keynote speaker and co-author of the ABA book, Case Dismissed! Taking Your Harassment Prevention Training to Trial. Sign up to receive her blog postings at BusinessManagementDaily.com/Mindy.

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