Michigan References laws & HR compliance analysis

Michigan References: What you need to know

Reference checks are a useful way for employers to gather information about applicants that they might not discover through the application and interview process. However, despite the usefulness of reference checking, many employers are legitimately concerned about lawsuits from former employees based on information provided in response to a request for a reference. This creates a quandary for employers.
Employers are also concerned about liability for the actions of employees where the company failed to conduct a thorough reference check. Michigan, like many states, has recognized the tort of negligent hiring (Hersh v. Kentfield Builders, Inc., 2189 N.W.2d 286 (Mich. 1971)). Employers may be liable for intentional or negligent acts of an employee if they knew or should have known of an employee's dangerous propensities. Therefore, employers should be diligent in conducting reference and background checks on new employees, particularly when the job involves contact with the public.
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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.
Michigan has a reference immunity law. Under Michigan law, employers are immune from liability if they, in good faith, provide information from the employee's personnel file in response to a request from the current or former employee or the prospective new employer (Mich. Comp. Laws § 423.451 et seq.). An employer is presumed to be acting in good faith in making such a disclosure unless the employee can prove ...

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