Employers are often asked to verify employment of former employees. While many employers may have a policy of providing a “neutral” reference, confirming only such information as dates of employment, compensation history, and last position held, an employer may not have the leeway to limit their responses. For example, in New Jersey, there may be statutory limitations placed on an employer’s verifications, such as in the healthcare industry. A recent case, decided by the New Jersey Appellate Division, highlights the nuances and potential pitfalls of providing employment verifications. (Senisch v. Carlino, 423 N.J. Super. 269 (App. Div. 2011)).
In the Senisch case, the Appellate Division found that pursuant to the New Jersey Healthcare Professional Responsibility and Reporting and Enhancement Act (often referred to as the “Cullen Act”), and existing case law establishing a qualified immunity for truthful job references by a former employer, the former employer-defendant (a hospital) could not be held liable in the former employee’s civil lawsuit alleging defamation and tortious interference with prospective economic advantage, by responding to a reference request with negative information from the personnel file of the plaintiff, a physician’s assistant, who had been terminated.
The employer-defendant in Senisch received a reference request from the plaintiff’s credentialing hospital which included a signed authorization from the plaintiff releasing the defendant-hospital from all liability for information provided “in good faith and without malice.” The hospital stated that it could not make a recommendation, for or against plaintiff’s application credentials, but it did provide a detailed letter outlining the reasons for plaintiff’s termination from the hospital, as reflected in the employee’s personnel record regarding problems with performance. The plaintiff then retained a company to pose as a prospective employer and seek information from the hospital regarding the plaintiff. The decoy employer sent the hospital a release agreement that authorized the defendant-hospital to “speak openly and honestly about [plaintiff’s] quality of work.” The hospital responded to this decoy inquiry in much the same way as the prior inquiry.
The former employee sued the hospital. Ultimately, the plaintiff’s claims were dismissed, with the appellate court explaining that the hospital’s letter provided “factual information from [the] plaintiff’s personnel file”, and properly “reported the nature of [the] plaintiff’s employment and the contents of the performance evaluations that remained in the employer’s file.” It added that “plaintiff does not and cannot allege that any statement in the letter is itself false….” and plaintiff did not present any proof that the statements were provided with reckless disregard for the truth, nor did the proofs overcome the qualified privilege of defendants to provide a truthful reference letter in response to inquiry from a prospective employer. Further, since the plaintiff in Senisch was a healthcare worker, the court found that the hospital was required to comply with the Cullen Act, which required it to make certain disclosures regarding its former employee, the plaintiff. The Cullen Act also contains a release from civil liability if the healthcare entity complies in good faith and without malice in responding to inquiries related to the health care professional’s job performance.
The employer-defendant in the Senisch case had the benefit of various statutory and common law protections from liability. However, each employee reference request presents employers with a unique situation. Employers need to be mindful of their obligations, rights, and responsibilities whenever providing a reference, particularly a negative one, regarding a former employee. Laws vary from state to state and among various industries, making it essential for employers to carefully examine their responses to a former employee’s reference request.