How to avoid legal pitfalls when you give references

▀ New Supreme Court case offers guidance

The Supreme Court just added another barb to the already thorny issue of giving references for ex-employees.

Thatís why weíre taken this opportunity to look at that and other key cases on references. Now we can bring you the most up-to-date rulings on:

When to keep quiet

Whenever employees leave after filing discrimination or accuse you of wrongful firing charges against your firm - watch out.

In Robinson v. Shell Oil, the U.S. Supreme Court decided that retaliation protection extends to your ex-employees, too. Say anything that convinces a company not to hire your ex-employee when that employee has a discrimination case pending against you. And you could wind up in court on retaliation charges.

In this case, the court didnít even look at what Shell actually said about Robinson, who had sued claiming his dismissal was racially motivated. The more fact that company officials said something negative shortly after he filed charges was grounds to sue.

Thatís why itís best not to say anything in these cases: itís no-win situation. Employees can easily produce the minimum evidence needed to bring a retaliation claim to trial (see story. P.4). And research shows that once companies land in front of a jury, they have only a 20% chance of winning their case.

When you have to speak up

The Allstate case - decided last year shows you canít always keep mum, however, Allstate was held liable for not telling another company that its former employee, Paul Calden was let go because he used to bring a gun to work.

One day Calden brought his gun to his new job at firemanís Fund and killed three co-workers. Victimsí relatives then sued Allstate for not disclosing Caldenís violent tendencies.

Clearly, the chances your ex-employee will kill someone are slim. But that case opens the door for similar suits.

If you fire an employee because that person caused serious problems - such as threatening or harassing co-workers, or stealing funds - youíre obligated to tell other companies, the courts say.

To share or not?

In most cases, ex-employees who want references werenít dismissed under a cloud of problem behavior. And they arenít charging you with harassment or racial bias, either.

While you know the safest route is name, title, and dates of service, you may want to provide other companies with more substantive information. And if youíre careful, you should be able to do that and protect your firm.

Hereís how to do it: