Academic journal article Labor Law Journal

Defamation Liability of Employers for Compelled Self-Publication: A Hot Trend That Fizzled

Academic journal article Labor Law Journal

Defamation Liability of Employers for Compelled Self-Publication: A Hot Trend That Fizzled

Article excerpt

I. Introduction

Compelled self-publication is a legal theory that once promised to negate a popular strategy employers use to defend against charges of defamation for employee references. This strategy requires company representatives to adhere to a strict "no comment" policy when asked for information about former employees who have applied for jobs elsewhere. The rationale for such a policy is that absent the employer's communicating or "publishing" negative information regarding a former employee, a critical element of the tort of defamation cannot be established. However, the theory of compelled self-publication could provide employees who were terminated for reasons that are false or unsubstantiated a cause of action for libel or slander against former employers even when the former employer has not communicated with prospective employers. This legal theory recognizes that in the process of applying for a new job, it is foreseeable that a former employee, who was terminated for cause, might very well be called upon to explain the circumstances under which he/she left the previous job. If so, the applicant in essence is "compelled" to disclose the reason for termination. If the termination was for a reason not supported by facts, naturally the employee would be expected to defend her/himself against the false accusations. Consequently, even though the previous employer, acting consistently with its "no comment" policy, communicated nothing to prospective employers, the employee could claim to have been defamed.

While it once appeared that a trend was developing in support of defamation liability based upon compelled self-publication, more recent court rulings in several jurisdictions have rejected the theory and reaffirmed the traditional requirement of actual publication by the employer to third parties in order to establish a cause of action for defamation. In addition, at least 36 states have statutes granting qualified immunity to employers when providing job references.1 Our research suggests the probability of a former employee winning a defamation claim based on a factual reference is low. A review of court decisions suggests that good employees would be better served if they could secure a favorable reference from previous employers, and employers could make better hiring decisions and reduce the costs of hiring poorly performing employees, if employers would provide factual references to prospective employers.

II. Defamation Requirements and Defenses

In the context of employment references, to establish a typical cause of action for defamation, the plaintiff must prove that an employer or the employer's agent communicated to a prospective employer a false statement of fact that damaged the plaintiff's reputation, effectively resulting in the person not being hired.2 The requirement that the defamatory statement must be communicated or "published," to someone other than the employee lies behind the common practice of refusing to disclose any details about former employees other than innocuous information such as dates of employment and job titles. In effect, to insulate themselves from liability for libel or slander, many employers have adopted a "no comment" policy with regard to former employees, whether they were excellent performers, poor performers, or even dangerous characters.3

Although simply avoiding publication of information to third parties reduces the threat of liability for defamation, the defenses of truth and "qualified privilege" make it unlikely that a former employee's lawsuit would be successful if the information was accurate or, even if the information was not true, but communicated in good faith. In this context, "good faith" means that the employer had a reasonable belief that the statements were correct.4

Since truth is an absolute defense to a claim of defamation, a thorough, objective investigation can establish a documented, factual basis for terminating an employee or negotiating a resignation. …

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