Employers must not panic into believing they have a duty to provide a
reference following a recent landmark case.
Last month Belinda Coote was awarded £200,000 damages against Granada
Hospitality which refused to supply a reference after she left the firm. She
had filed a claim of sex discrimination against Granada, which was settled out
of court.
But her case concerned an act of discrimination and was not specific to
issuing references.
"She [Coote] won because she was victimised," said John McMullen,
head of employment law at Pinsent Curtis.
"There is no duty to provide a reference, save for particular industry
sectors."
The exceptions are principally financial services and health and social
care, where it is impossible to work without a reference and hiring an
individual implies a duty to provide one.
In most other sectors an employer who is unhappy about a former employee’s
performance, but has no evidence to indicate wrong-doing, is therefore free to
decline.
McMullen added that employers sometimes decline references to protect their
interests. "People are so scared about writing references because the law
has developed in terms of liability for negligent references.
"People think they are better off not writing one."
Caroline Carter, a partner at corporate law firm Ashurst Morris Crisp, said
the subject of references is becoming a legal minefield.
She is advising clients to review policies on references in the light of the
case.
"They must look at what their staff handbook says about giving
references. If an individual leaves service after any tribunal proceedings, the
agreement reached with them must take references into account."
By Philip Whiteley
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• Coote’s claim was a landmark case when it reached the European Court of
Justice in 1998 because it ruled that discrimination claims could be filed for
actions against an ex-employee. It referred the case back to a British
tribunal, which gave its judgement last month.
UK law restricted discrimination claims to current employees, but the court
ruled that the European Equal Treatment Directive extends rights to staff who
have left. Coote had lodged a claim of sex discrimination against Granada in
1993 and reached an out-of-court settlement. But when applying for a new post
she was refused a reference.
