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. Additional information on these 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 immunity laws generally provide protection from claims by former employees for defamation of character.
California is among the states that have enacted reference immunity laws. Under California law, truthful communications about job performance or employment qualifications of a current or former employee are privileged as long as the communication is based on credible evidence and made without malice (CA Civ. Code Sec. 47(c)). Privileged communication includes answering the question, “Would you rehire the employee?” The privilege does not apply to comments about an employee's protected speech or activity that is protected by federal and/or state law. Privileged communications cannot form the basis of a defamation claim (libel or slander) under California law.
Sexual harassment. Effective January 1, 2019, the law authorizes a current or former employer to disclose whether a decision to not rehire is based on the employer’s determination that the former employee engaged in sexual harassment.
Practical advice. Even with a reference immunity law, employers in California should consider taking precautionary measures ...