The Legal, Ethical, and Managerial Implications of the Neutral Employment Reference Policy

The litigious environment surrounding employers today has caused them to be overly fearful of providing candid yet adverse employment references. Their attempts to minimize litigation risk created by the dismissal of a vindictive employee have clouded their judgment when asked to assist in the dissemination of employee information. This is alarmingly illustrated by the growing number of employers who have blindly adopted a neutral reference policy. Unfortunately, indiscriminate application of this policy will not necessarily preclude litigation, but, rather, foster it. It is imperative that employers carefully weigh the tangible and intangible costs of a reference defamation suit against their duty legally, ethically, and managerially to disclose vital information about a former employee.