Generally speaking, there is no legal obligation on an employer to provide a reference. However it is relatively unusual for employers to refuse and an employer may be obliged to provide one if it has contracted to do so, or if the employee is performing controlled functions in the financial services industry.
Even where there is no obligation to provide a reference, an employer cannot refuse to give one for discriminatory reasons, or in order to punish an employee for having previously alleged discrimination or blown the whistle.
If an employer chooses to give a reference, it owes a duty to take care in doing so, which means providing one which is in substance true, accurate and fair. It can also be sued for defamation or malicious falsehood in respect of damaging comments which it knew, or should have known, were untrue.
- An employer is under no obligation to obtain a reference for a potential new employee, but it is common to seek at least one reference and to make any job offer conditional on a satisfactory reference.
- An employer may be required to provide a reference if it has entered into a contractual obligation to do so, whether expressly or by implication, or if the employee is performing controlled functions in the financial services industry.
- An employer cannot refuse to give a reference for discriminatory reasons, or in order to punish an employee for having previously asserted discrimination, or blown the whistle.
- If an employer provides a reference it owes a duty of care to both the former employee and the prospective employer and is under an obligation to provide a reference which is in substance true, accurate and fair.
- Employees should not give personal references on company letterhead.
- Employers can also be sued for defamation or malicious falsehood in relation to any unfavourable statements which are untrue, if the person giving the reference either knew it was untrue or was recklessly indifferent as to whether it was true.
- It is more and more common for employers to have a policy only to provide a bare references, giving dates of employment, position held and sometimes salary.
- Provision of a reference will generally involve the disclosure of personal data for Data Protection Act 1998 purposes.