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Detailed or Factual References: What is the Right Approach for Your Organisation?

Employment Law & HR

Most offers of employment will be made subject to the receipt of satisfactory references but knowing how much information to divulge can be tricky. Employees do not always leave their previous employment on the best terms and their previous managers may feel that they cannot and should not give a positive reference. There is a common misconception that an employer cannot give an employee a bad reference but that is not strictly correct. Rather, the information contained must be true, accurate and fair and must not give a misleading impression.  Acas’ recently published guidance on employment references attempts to help employers navigate this difficult area.

There is no general obligation upon employers to provide references for current or former employees. There is also no obligation to provide detail in a reference or for it to be comprehensive. The exception to this is where an employer is regulated by the Financial Services Authority, in which case they are required by law to provide a reference. Whilst an employer can therefore decide for itself whether to refuse to provide references or to only provide a factual reference, it is advisable to apply the same practice for all employees to avoid a possible discrimination claim.  

Employers sometime express concern that not providing a more detailed reference can lead to bad faith both among other organisations and with employees. This can especially be the case in niche sectors where individuals may move between just a handful of organisations. However, employers should note the possible risks that come with providing detailed references. When giving a reference organisations have liability both to the employee and to the new employer, both of which could raise a number of claims as a result of an untrue or inaccurate reference.

In order to ensure a consistent approach, employers may wish to consider putting in place a policy on providing references. These can include details such as:

  • The legal position on providing references
  • The aim of providing a reference
  • General rules on providing references including only being provided by authorised individuals, only commenting on issues that have been raised with the employee and not including facts the author is unsure about
  • Liability for references and a disclaimer advising recipients that the provider does not accept responsibility or liability for loss or damage caused if the reference is relied upon
  • Confidentiality and the disclosure of references
  • Whether the organisation provides verbal references

If you have any questions on providing references or would like to discuss putting a references policy in place, please get in touch with your dedicated legal manager today.

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