Kate Palmer from Peninsula UK discusses the implications of government proposals to require employers to give references as part of its response to the Women and Equalities Committee report on non-disclosure agreements.
The Government has announced that it will consult on proposals to require employers to give references as part of its response to the Women and Equalities Committee report on non-disclosure agreements. Kate Palmer from HR experts Peninsula UK discusses the implications.
Although providing a negative reference is not unlawful, employers are under a duty to ensure that the substance is accurate and fair. Crucially, it must not give an unfair or misleading impression overall, even if its discrete components are factually correct.
Under data protection law employees have a right to see their reference as this is confidential information about them. An untrue statement that damages the reputation of the employee may amount to defamation, something that can result in a claim through civil courts. In the context of a reference, this is only likely to happen if the person who makes the statement knows or has reason to believe that the content is untrue or has not troubled to check whether it is true. If this person has made the incorrect comments maliciously, the employee may also be entitled to bring another claim for malicious falsehood.
The law which protects employees from discrimination also applies in this situation even after employment has ended. This means that employees can make a claim for discrimination against both their previous company and potentially the new employer if the information in the reference discriminates against them. Bear in mind that employees do not need any length of service to bring such a claim and can do so at no charge.
There are no requirements regarding the length of the reference and employers are currently free to provide as little or as much information as they wish. Because of the risks associated with giving references, it is becoming more and more common for employers to provide references that only state the position held by the former employee, the dates of employment and salary. As it appears that any new legislation would only require employers to provide the most basic of references, most employers would likely continue to avoid distributing more detailed documents. It, therefore, remains to be seen how much any new law would change, it at all, the current systems adopted by companies.
Regardless of this consultation, employers within some industries are already under a legal duty to provide a reference. Businesses who are regulated by the Financial Conduct Authority or the Prudential Regulation Authority are under an obligation to respond in a reasonable time to a reference request by providing all relevant information they hold if the employee concerned was an ‘approved person’.