Employers Begin To Feel Impact Of New References Statute
Many employers limit the type of information they will give to potential employers of current or former employees or refuse to give out information at all for fear of a potential lawsuit. In response to this concern, the Minnesota State Legislature enacted a statute, effective August 1, 2004, providing employers with some shelter from liability. Specifically, under the new statute, if an employee wants to sue an employer for defamation relating to a reference, the employee now has to show not only that the information was false and that the employer knew or should have known that it was false, but that the employer acted “with malicious intent to injure” the employee when it provided the information to the potential employer. This is a very high standard, and it will be difficult for plaintiffs to meet.
Nonetheless, the “shelter” created by the statute is not unlimited; it only applies to certain information and treats private and public employers differently. Specifically, the statute protects a private employer when providing the following:
- dates of employment;
- compensation and wage history;
- job description and duties;
- training and education provided by the employer; and
- acts of violence, theft, harassment, or illegal conduct documented in the personnel record that resulted in disciplinary action or resignation and the employee’s written response, if any, contained in the employee’s personnel record.
A disclosure falling under this last category must be in writing, and a copy must be sent to the employee’s last known address.
In addition, if the employee gives written authorization to a current or former private employer, the protection of the statute extends to the following categories of information so long as the employer provides the information in writing and contemporaneously sends a copy to the employee:
- written employee evaluations and the employee’s written response contained in the employee’s personnel record;
- written disciplinary warnings in the five years before the date of the authorization and the employee’s written response contained in the employee’s personnel record; and
- written reasons for separation of employment.
The protection of the statute extends to public employers only if the employee gives written consent to the employer. Again, the information protected by the statute is limited. Specifically, with written consent, a public employer is protected by the heightened standard when providing the following information:
- written employee evaluations and the employee’s response contained in the employee’s personnel record and
- written reasons for separation from employment.
While employers are certainly grateful for the protection the statute provides, some are finding its limitations and distinctions tedious and time-consuming. For instance, the statute only protects certain categories of information, and even then draws distinctions depending upon whether the employee or former employee has provided the employer with written consent. Further, some information is only protected if it is actually contained in writing and is found in the employee’s personnel record. Finally, some information is only awarded protection if the employer provides the current or former employee with a copy of the information provided to the prospective employer. All of these requirements lead to additional work and record-keeping for employers.
What’s an employer to do? If an employer plans to take advantage of the statute, it should keep the following in mind:
- Consider revising your references policy (or enacting a policy if no such policy exists) to incorporate in the safe harbors created by the statute (for example, create/revise policy to list: (1) what information you are willing to give out in light of the new statute; (2) what information you will give out with the employee’s written permission; and (3) what information you absolutely will not give out).
- Designate one person to be responsible for reference requests and route all requests through this person.
- Be aware that the following information should only be released with the employee or former employee’s written consent and only if the information is contained in the employee’s personnel record:
- Employee evaluations;
- Disciplinary warnings (note: disciplinary warnings should not be released if you are a public employer); and
- Any writing that explains the reasons for the employee’s separation from employment.
- Consider asking the employee when they leave if they would like to provide written consent for the release of this information at that time. Consider creating a form for this purpose.
- When responding to a references request, redact the names of other employees or individuals from any copies so as to protect their privacy.
- Finally, when responding to requests for information related to (1) wrongful conduct resulting in disciplinary action; (2) employee evaluations; (3) disciplinary warnings; and (4) the reasons for the employee’s separation from employment, be sure to contemporaneously send a copy of the information to the current or former employee.
Note too, that the statute does not effect an employer’s obligations under Minnesota Statute § 181.933, which requires employers to provide employees who have been involuntarily terminated with written notice of the reasons for the termination if an employee makes such a request. Section 181.933 has its own provision addressing defamation actions and states that no action for defamation can be brought against an employer who responds to an employee request under this statute.
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