Bad reference not bad faith, court rules

Employers have become gun shy about giving references for former employees, but court decisions do not support this level of caution.

In a recent decision, the Ontario Superior Court found that an employer’s negative comments were not intended to result in the loss of re-employment for a terminated workers, and no award for bad faith should be made.

In Caers v. Usborne & Hibbert Mutual Fire Insurance Co., Caers had worked almost 14 years as a secretary/manager at the insurance company and it was only his second job after his grade 12 education. There was only one other full-time and one part-time employee, but for legal purposes, Caers was still considered to be a manager.

The day before his termination, he was at the company’s annual meeting and present during press coverage of the meeting and for a photograph of the board — no sign his performance was in question. At termination, the insurance company told him it was due to a change in company management.

Afterwards, Caers applied for a job at another insurance company and was selected as the leading candidate for the position. In the end, however, he was not offered the job. Subsequently, Caers learned that one or more directors of the board had commented to his prospective employer that Caers “didn’t like to take direction.”

Ontario Superior Court Justice Letich found that the directors had no intention to disadvantage Caers’ prospects for re-employment when they made the comments. Therefore, there was no bad-faith conduct.

Justice Letich did find that appropriate notice for his termination was 18 months, not the 13 months he was offered by the company. This was based in part on Caers being 52 years old, his 14 years’ service and his management position.

This article was originally published in Carswell's Human Resources Management in Canada. For information about subscribing to this service, call 1-800-387-5164.

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