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, and liability for the actions of employees where the company failed to conduct a thorough reference check. This creates a catch-22 for employers. There is additional information and a detailed discussion of these legal issues.
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. Under Montana law, a person is not barred from providing a discharged employee's prospective employer with a truthful statement of the reason for the discharge (MT Stat. Sec. 39-2-802).
Practical advice. Employers in Montana should take precautionary measures when giving references, including:
• Insisting 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 authorization should be kept on file along with a copy of the reference (or a written summary if the reference was given orally).
• Confining remarks to an objective evaluation of job performance.
Montana law also prohibits employers from maintaining a “blacklist” or notifying an employer that an employee or former employee has been “blacklisted.” A ...