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 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. New Jersey is not among the states that have enacted reference immunity laws.
In fact, the New Jersey courts have ruled that an employer may be liable for negligent misrepresentation if it provides an inaccurate or false employment reference (Singer v. Beach Trading Co., Inc., 876 A.2d 885 (N.J. App. Div., 2005)). An employer can be held liable for misrepresenting a former employee's work history if:
• The inquiring party clearly identifies the nature of the inquiry;
• The employer voluntarily decides to respond to the inquiry and unreasonably provides false or inaccurate information;
• The person providing the inaccurate information is acting within the scope of his or her employment;
• The recipient of the incorrect information relies on its accuracy to support an adverse employment action against the employee; and
• The employee incurs damages caused by the false or inaccurate information.
On the other hand, employers will not be liable for giving truthful information about a former employee to a prospective ...