Employers generally use reference checks to verify or gather information about job applicants. Despite the usefulness of reference checks, employers that are asked to provide references may be legitimately concerned about defamation lawsuits by former employees if negative information is provided in response to a reference request. A detailed discussion of legal issues is available.
To deal with employers' reluctance to provide information about former employees, a number of states have enacted laws “immunizing” employers against employee claims over such disclosures. The protections provided by these immunity laws are from claims for defamation of character—libel and slander. Alabama has not adopted a reference immunity law.
However, Alabama courts have held that statements made by an employer to a former employee's prospective employee are protected by a conditional privilege. The employer will not be liable for defamation if the communication is made in good faith, without actual malice, and the prospective employer has an interest in the communication; i.e., an interest in the employee's past job performance (Clark v. America's First Credit Union, 585 So. 2d 1367 (Ala. 1991)).
Practical advice. Even with a qualified privilege, employers in Alabama that choose to give references should observe the following precautions:
• Insist on a written authorization from the employee/former employee who will be the subject of the reference or from the prospective new employer. The written and signed authorization should be kept on file along with a copy of the reference or a written summary of the reference if given orally.
• Strictly confine remarks to an objective evaluation of job ...