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The Bad Reference: What Can Your Former Employer Say?

You’re fired! We have all heard Donald Trump utter this phrase on The Apprentice. But what happens when you have been fired?

Employment ReferencesWhat if it was for an untrue or unjustified reason? Or worse, what if you actually did something illegal or in violation of company policy that justified your termination?

Once you have recovered from the initial shock of your termination, it is time to get back out there and begin searching for a job. But with the black mark of a termination now on their record and the possibility of a bad reference, many employees are paralyzed with fear about what their prior employers are allowed to say to future employers. So what can your prior employer say?

California Employees Have Protection Against Misrepresentation In Employment References

The good news is that in fifteen years of practice, this type of claim surfaces much less frequently than people think. Unbeknownst to most people, the California Labor Code governs what your prior employer can and cannot say. Labor Code Section 1053 specifically states:

“Nothing in this chapter shall prevent an employer or an agent, employee, superintendent or manager thereof from furnishing, upon special request therefore, a truthful statement concerning the reason for the discharge of an employee or why an employee voluntarily left the service of the employer.”

Thus, they must be truthful if they decide to provide a reference. However, despite the employer’s right to make a “truthful statement concerning the reason for the discharge,” the truth is that most companies do not state a reason at all. This in part because California Labor Code Section 1050 (so called “black listing” law) makes it an actual crime for an employer to make a “misrepresentation” that prevents you from obtaining employment. California Labor Code section 1050 states:

“Any person, agent or officer thereof who, after having discharged an employee from the service of such person or after an employee has voluntarily left such service, by any misrepresentation prevents or attempts to prevent the former employee from obtaining employment is guilty of a misdemeanor.”

In addition to making it a crime, the Labor Code provides for treble civil damages (section 1054) for a violation of Labor Code Section 1050. In other words, if your prior employer makes a misrepresentation that causes you to lose a job or fail to be considered for a job, you can recover three times the amount of your damages. As one might surmise, this along with the criminal penalty is motivation for most employers to refuse to disclose the reasons for an employee’s departure. Indeed, in today’s litigious society most employers are counseled that it is a much safer, and less costly, practice to limit their response to the employee’s dates of employment and titles held in response to a reference check from a prospective employer. In short, it is not worth getting sued by a former employee for providing a bad reference. This is powerful motivation.

But what if your prior boss merely states that you are not eligible for rehire? If an employer states that you are not eligible for re-hire that can effectively end your job search even if there is no further comment.  In our negotiations with employers, I always insist on including a provision that the employer will provide only neutral information dates of employment, salary, position and further that the employer will not comment on an employee’s eligibility for re-hire.

If you are concerned that a prior boss (or believe you have a vindictive former boss) that may state information to a potential employer that causes that employer not to offer you employment, request a written reason for the reason you were not offered the job. Or at a minimum, have a conversation with the person who communicates to you that you will not be hired and ask if they contacted your prior employer and what was said. Remember to obtain the names of all persons and the dates of conversations. This will be important should you wish to later bring a claim.

John R. Goffar is a Partner with Advantage Law Group. Mr. Goffar has been practicing Employment Law for more than 15 years. Advantage Law Group is an Employment Law Firm representing employees throughout California. The firm offers a free consultation to all clients. Any San Diego, Orange County or San Francisco employee who is presented with a separation agreement which releases liability with their former employer should consider hiring us to protect their rights against negative employment references.

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