How does the Texas job reference law affect what I can say about former employees? — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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How does the Texas job reference law affect what I can say about former employees?

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Q. I recently received an inquiry for a reference regarding a former employee. Does the job reference law alter what I should disclose regarding this person’s employment history?

A. The job reference law was passed in response to the all-too-familiar story: An applicant who is denied a job believes the reason was a negative reference by his former employer. Therefore, he sues for defamation.

Due to this very real risk, many employers have adopted “neutral reference” policies that seek to avoid liability by refusing to provide any information to a prospective employer other than objectively verifiable facts (such as dates of employment, pay rate and job title).

In 1999, the Texas Legislature concluded that neutral references deprive prospective employers of valuable information because, as the Legislature stated, “disclosure by an employer of truthful information regarding a current or former employee protects employment relationships and benefits the public welfare.”

The new law seeks to further this public interest by protecting former employers that provide references to prospective employers.

The law grants immunity from civil liability to employers that disclose “job performance” information to a prospective employer, unless the employee can prove that the former employer knew the information was false and made the disclosure with either malice or reckless disregard for the truth.

In many respects, the law did little more than codify the law as it had been applied by the courts. Even though it has been in effect for a decade, there have been no court cases interpreting it.

Thus, while the law was intended to be a positive change for employers, most employers have retained their neutral reference policies.

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