If you are looking for work, you may have questions about what your former employer will say to companies that ask for a reference. References can make the difference between landing a new job and receiving a rejection letter. If a former employer is giving out false or misleading information about you, it could doom your job search.
In Arizona, as in most states, employers are protected from liability for certain types of information they provide to prospective employers. However, if a former employer acts maliciously or otherwise crosses the legal line, and you lose job opportunities because of it, you may have a legal claim.
In a defamation lawsuit, the plaintiff (the person bringing the lawsuit) alleges that someone made false and damaging statements about him or her. In the context of employment, defamation claims almost always center on statements the employer makes about the employee once the employment relationship ends. Typically, a former employee claims that the employer made false, negative statements about the employee’s performance to a prospective employer who called for a reference, and the prospective employer decided not to offer the employee a job (or to rescind a job offer) because of the poor reference. (To learn more about defamation claims, see Defamation Lawsuits: Do You Have a Case Against a Former Employer?)
In Arizona, an employer may provide certain reference information to a prospective employer, upon request of the employee or the prospective employer, without fear of legal liability. An employer may provide information on the reasons why the employee was terminated, the employee's job performance, the employee's professional conduct, and the employee's evaluations to prospective employers. However, the employer is immune from legal action only if it acts in good faith in providing this information.
Arizona law presumes that an employer acts in good faith if:
In contrast, an Arizona employer is not immune from liability if:
If either of these is true, the employer has acted in bad faith and is no longer protected from lawsuits for defamation.
If an employer provides any written information about an employee (for example, a written reference), the employer must send a copy to the employee's last known address.
While some employees wish their former employers would keep quiet, some employees face the opposite problem: They want a former employer to provide information, but the employer isn't willing to speak up. Some employers are so fearful of defamation claims that they won't give references under any circumstances.
To remedy this situation, some states have enacted service letter laws. These laws require employers to provide former employees with certain basic information, in writing, about their employment. Although former employees are entitled to receive a copy of any written information the employer provides about them, as discussed above, Arizona law doesn't affirmatively require employers to put this information in writing in the first place.
If you want a former employer to provide more detailed information that the law requires, you might consider signing a release: an agreement giving the employer permission to respond to prospective employers who call for a reference, and giving up your right to sue the employer for anything said as part of that process.
However, this makes sense only if you are absolutely certain that the reference will be positive. It may be worth giving up your legal right to sue in exchange for a reference that will help you land a position, but you don’t want to sign away your rights only to find that you have no recourse against a former employer who damaged your reputation and job prospects. For more information, see Getting Good Job References. For information on your legal rights during the hiring process, see Nolo's articles on Getting Hired.