Wake-up call – duty of care to former employees

18 November 2011
Wake-up call – duty of care to former employees

How should you respond when asked informally about someone you once worked with? Be careful what you say about them, warns Katee Dias

PROBLEM During some email chat with a former colleague, I discovered that my chef of a few years ago had recently been recruited by them. Although the chef left my employment on good terms and I have even acted as a referee for him, I do have a few concerns which I have not voiced previously.

I mentioned this in my email and I understand that, as a consequence, he was dismissed. Now the chef is threatening to sue me.

Should I be worried?

LAW It is fairly well known that when an employer gives a reference about an ex-employee, the reference must be true, accurate and fair.

There is also a duty to ensure that the reference is not misleading. Therefore, if you have concerns about the employee but these have never been addressed, it is not appropriate to raise them subsequently in a reference as this would not be consistent with the facts of the employment relationship.

It is perhaps less well known that these principles apply equally to informal verbal remarks as they do to formal written references and that parallels can be drawn in non-reference situations too.

In the case of McKie v Swindon College, which was heard by the High Court earlier this year, it was confirmed that an employer could be liable for negligent misstatement where it is foreseeable that damage will be suffered as a result of their comments, there is a sufficient degree of proximity or "neighbourhood" between the employer and employee and it is fair, just and reasonable to impose such a duty of care.

ADVICE Applying the principles laid down in the McKie case to the above scenario:

â- By the very fact that your comments concern your previous employment relationship with the chef, you have a proximate relationship. It does not matter that a few years have elapsed (as in the McKie case, six years had gone by).

â- It is fair, just and reasonable to impose a duty of care upon you because if there was no such duty, the chef would have no remedy (particularly as employees with less than one year of service are not usually protected from being unfairly dismissed by their current employer).

If the chef does carry out his threat to sue you, it is likely that a finding of negligent misstatement will be made (particularly as you have never addressed your concerns with him and have previously provided him with a good employment reference).

CHECK LIST â- Take care to ensure that you (as the employer) and your officers, directors and employees do not make any comment that could give rise to a finding of negligent misstatement, whether during the employment relationship or at any time thereafter.

â- Remember that it is not just comments in response to a formal reference request by a new employer that can result in liability. Also, it does not matter if the comment is made in writing or verbally (even if you state that it is "off the record").

â- As well as an action for negligent misstatement, there may be claims for defamation and/or under the Protection of Harassment Act 1997.

BEWARE In a successful claim for negligent misstatement, an ex-employee can receive compensation for any reasonably foreseeable financial loss that they have suffered as a result.

Where an employee has lost their job, the amount of compensation is likely to be equivalent to the remuneration that they would have received during the period between when they lost their job and finding new employment elsewhere.

Katee Dias is a solicitor at Goodman Derrick LLP

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