You be the Judge: If you are an Employer

If you are an employer, this may interest you.

Marsha was employed as a manager in a family-owned business. During her employment, she was asked to oversee the customer service operation, and she was referred to as a Vice President of Daily Operations.

Later, she submitted her resume to another company. She got a new job with a new employer who was impressed with her background as a customer service supervisor. The new employer promised Marsha a sixty-day severance package if she was terminated within the first year of employment.

After about two weeks, Marsha’s new employer became critical of her managerial skills. He placed telephone calls to several employees at her old place of employment for references about her employment history.

Some of those employees allegedly said that Marsha had not been a supervisor or a Vice President.

The new employer then terminated Marsha, claiming that she had obtained her new job under false pretenses.

Marsha settled the severance payment with the new employer. But, then she sued her old employer for defamation. She argued that her new employer was given false information. She claimed that the old employer had a continuing responsibility to supervise the employment information given about her.

YOU BE THE JUDGE: Does an employer have a duty to make sure that all of its current employees give truthful reference information about a former employee?

The Appellate Division thought so, under certain circumstances. It reached this determination although, in New Jersey, an employer has no obligation to make any response to a reference inquiry.

The Appellate Division held an employer can be responsible under these circumstances: 1) the purpose for the inquiry is clearly stated to the former employer; 2) the former employer decides to voluntarily respond; 3) the person who provides the inaccurate information is acting within the scope of his duties for the former employer; 4) the inquirer relies upon the inaccurate information to support an adverse employment action against the plaintiff; and 5) the plaintiff suffers a loss as a result of the inaccurate information.

If you would like a copy of the recent decision in Singer v. Beach Trading Co., Inc. , 379 N.J. Super. 63 (App. Div. 2005), please call our office.