New legal considerations regarding employee references

Employers need to be concerned about providing factual and accurate references. In Singer v. Beach Trading Co. Inc., former Beach Trading Co. employee, Marsha Singer, was terminated from her new position at HRK Enterprises after a Beach Trading Co. representative erroneously indicated Singer had falsified the title of her position at Beach Trading Co.

In this case, the New Jersey appeals court ruled employers can be held liable for the negligent misrepresentation of a former employee’s work history if the following five factors are met:
· The party calling for the employment reference fully identifies the nature of the request.
· The employer voluntarily decides to respond and unreasonably provides false or inaccurate information.
· The responder is acting within the scope of his or her employment
· The recipient of the information relies on it to support an adverse employment action against the employee.
· The employee suffers quantifiable damages because of the misrepresentation.

Employer tips for giving references

· Respond only when the requester has fully identified him/herself, including title and company.
· Provide only relevant and factually accurate information.
· Assign only one or two individuals the responsibility of responding to requests for references.

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