We often hear of divorce stories featuring couples fighting over something meaningless. The marriage is over, the finality of divorce hasn’t set in and they are stuck fighting over who gets the toaster. Neither person needs a toaster — they just want something to prolong the conflict.
In my view, the employee reference letter is to employment lawyers what the toaster is to family lawyers.
Most of the ink spilled and time wasted discussing reference letters has come as a result of an employer refusing to provide a letter of reference after a termination, without a legitimate reason. Despite popular opinion, the law does not require an employer to provide a reference — this was confirmed in 2008 by the Ontario Court of Appeal in Titus.
While courts have held that bad faith damages may arise when an employer unnecessarily withholds a reference, the Supreme Court of Canada in Keays said damages cannot be automatically awarded without proof of actual damages:
“If the employee can prove that the manner of dismissal caused mental distress that was in the contemplation of the parties, those damages will be awarded not through an arbitrary extension of the notice period but through an award that reflects the actual damages.”
It will be difficult for any employee to prove damage arising from a previous employer’s failure to provide a reference letter — this is especially true when a pre-made reference letter reeks of desperation in an application package.
Optional or inconsequential
While a reference letter may be as helpful as a hairpiece in an interview, it doesn’t mean employers should exercise their technical right to refuse.
Employers have every interest in seeing former employees find alternate employment and should do what they can to assist (or appear to assist) in that process.
Also, some encouragement should come from the British Columbia Supreme Court in Vernon v. British Columbia (Liquor Distribution Branch), where the court ordered the employer to pay $50,000 for offering a reference letter in exchange for resignation, and also the Quebec Court of Appeal, which awarded a teacher $5,000 in damages for the employer’s failure to provide a reference letter.
Neither would have happened if the employer simply treated the reference letter in its giving as in its receiving — as a useless piece of paper.
While these cases are more about the employers’ bad behaviour than reference letters, an impractical stance on providing letters of reference can provoke damages.
If you can’t say something good…
Providing negative references is more problematic. In light of the Supreme Court of Canada’s decision in Young v. Bella (and common sense), they need to be backed up with provable evidence.
There is no upside to providing a negative reference and, frankly, it is difficult to imagine a court awarding damages against an employer whose conscience prevents her from providing a positive reference.
In Young v. Bella, the court suggests employers can be held liable for negligently providing a negative letter of reference. However, it is rare for an employer to refuse giving a reference letter after termination because of legitimate reasons not to — they just don’t want to. Employees are more often underwhelming than corrupt.
Admittedly, undeserved and unwarranted positive references prior to termination can also be problematic. A prime example is the mindless recommendations on LinkedIn. It’s difficult to argue an employee is incompetent while praising his attributes in writing. However, by allowing managers to “recommend” people on Linked-In, managers and co-workers are forcing HR and lawyers to do just that.
Employees are encouraged to enhance their profiles online by asking for recommendations from co-workers and supervisors. And co-workers and supervisors are reluctant to refuse when asked, regardless of whether the employee is a good worker — therein lies the problem.
The solution is simple: Encourage employees to enhance their profiles online through sites such as LinkedIn — but do not recommend anyone without careful consideration. Human nature makes it difficult for a person, when asked, to deny the request to “recommend” someone. Therefore, a “no recommending employees on LinkedIn” clause in a social media policy is helpful. It provides an ideal excuse when denying an employee that request and, hopefully, avoids causing offence.
HR as gatekeeper
All the controversy can be avoided if employers have a policy with respect to reference letters that clearly makes the task one for HR. Human resources has the information about whether an employee’s performance can justify a positive reference. This removes the emotion of the manager and the element of surprise in litigation when it’s revealed a reference letter was refused. It also builds in a real assessment of whether an employer can say something good as opposed to nothing at all.
There is no reason to fight over the toaster. If you have legitimate, provable reasons that prevent you from providing a positive letter of reference, then don’t. The letter of reference doesn’t have to be a letter of recommendation, it can simply attest to an employee’s skill or, at the very least, experience.
If you are ambivalent, highlight an area the employee did well and provide a letter of reference that is helpful — more often than not, a litigious employee wants a refusal more than a letter.
The reference letter could go back to being meaningless if we all stopped pretending it was a big deal. Use judgment and provide what you can, if you can. No employer has ever been criticized for providing a letter of reference that wasn’t sufficiently “glowing.” Take the high road and stop allowing employees to unnecessarily prolong the dispute.
Clarence L. Bennett is a partner at Stewart McKelvey in Fredericton. He can be reached at (506) 444-8978 or email@example.com.
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