Rod Satterwhite and David Greenspan are members of the Labor & Employment group at McGuireWoods LLP. Both handle employment litigation on behalf of employers, and advise companies on employment issues regularly.
posted on Tuesday, January 22, 2008 1:34 PM by Lou Michels

So Much for the Neutral Reference Policy

    Employment lawyers are constantly advising their clients that candor in references for ex-employees is rarely a good idea.  It's not that we want our clients to mislead companies unlucky enough to hire the cast-offs, it's just that giving a reference that actually provides useful information (versus the neutral reference’s bland recitation of dates of employment, job title and, perhaps, salary) has so much baggage attached to it. 

     So it's refreshing when a law firm actually steps out on the reference ledge every now and then. 

     The firm of Kasowitz, Benson, Torres & Friedman LLP ("KBTF" for obvious reasons) got slightly miffed when it read in a story that the lawyer it removed for cause last December got a new job, and that he had been recruited away by his new firm, a competitor in the intellectual property litigation market.  Rather than seething in private, one of the name KBTF partners issued a press release telling the world that KBTF fired the attorney for cause because of "extremely inappropriate personal conduct." 

     Wow -- not just "inappropriate personal conduct," but "extremely" inappropriate personal conduct.  Further fanning the flames, KBTF also noted that it fired its former partner following a thorough, weeklong investigation, and that the firm's action was part of its zero-tolerance policy for this type of misconduct.  Makes you wonder if the former lawyer/employee is still combing the tar and feathers out of his hair.  Did I mention that all of these folks are in New York?

     The last time I can recall a law firm firing off a press release with negative information about a lateral move was several years ago, when a Latham & Watkins recruit found himself being pilloried by his former firm for sexual harassment allegations and low billable hours.  I'll let you guess which one was a bigger sin for the former employer.  The ensuing lawsuit settled for somewhere between $5 million and $10 million, according to the legal press.  I am now wondering whether KBTF's former counsel will follow a similar path.  I guess that's one way of generating new business.

 

Comments

# re: So Much for the Neutral Reference Policy

Wednesday, January 23, 2008 10:28 PM by Michael Caldwell
They certainly invited a lawsuit, especially since nobody asked them for thier opinion of their former lawyer.
However, in Georgia at least, employers who provide employment references about current or former employees to prospective employers enjoy a qualified privilege protecting them from liability for defamation. They ;pse the privilege if the plaintiff can show they acted with malice (knowledge that the information they provided the prosepctive employer was false, or reckless disregard for whether it was false or true). Of course you still have the federal discrimination laws with their anti-retaliation provisions, and the National Labor Relations Act. However, it isn't really difficult to comply with these laws while providing relevant information information that you believe (and have a reasonable basis for believing)is true. And if you get a written waiver from the employee, all the better. Failing to provide meaningful information will ensure that you'll get none when you're asking for references.

# re: So Much for the Neutral Reference Policy

Thursday, January 24, 2008 2:08 PM by Lou Michels
Michael, I'm guessing that the losing firm either has video of their former partner doing something improper, or similar evidence, so that any defamation lawsuit would not only be unsuccesful, but extremely embarassing. Issuing the press release is a "throw down the gauntlet" type of action that invites a legal response, unless both sides know there is something out there that effectively proves the truth of the release.

# re: So Much for the Neutral Reference Policy

Friday, March 21, 2008 1:47 AM by soulgrip2
Have a question regarding something similar to this though its not as extreme as a press release being sent out. My wife is a former employee of Wal-mart. Last december she had a dispute about a disciplinary action that she was getting that did not fall in company policy. To make things short, she was later fired a few days afterward but was told that she "technically" quit so her unemployment benefits would be blocked. As you can guess this really messed things up with her former managers at the store when she appealed the blocked unemployment benefits and got a hearing. Here is where I need help from you guys. A few weeks after she stopped working there we asked someone to pose as an employer calling about my wife's reference at the store, just to see what they would say. The manager that screwed her out of the job got on the line and our person asked a few questions. He said he could not give any information about why she wasn't working there anymore, but when asked about her job performance and her future hiring qualifications he said that he would not re-hire her in the future. I was reading through some of her exit paperwork from Wal-mart and I noticed that they have a Neutral Reference Policy. It states that the ONLY information they are allowed to give out to anyone seeking a reference is the date she was employed and her position with the company. Does this sound like grounds for a lawsuit? He clearly didnt follow Wal-mart's policy on the situation as told on Wal-mart's OWN paperwork. The reason Im asking is because he was so over-the-top about Wal-mart's "Policies" when my wife had her unemployment hearing. Id really appreciate any help you guys can give me. We live in Iowa. I tried to find state laws about this because it mentions "where state laws allow" in wal-mart's policy but I cant find anything on the internet. Is it worth talking to a lawyer about this? Id really like to do anything if i can because of the way they treated her after almost 4 years of work. Thanks.

# re: So Much for the Neutral Reference Policy

Friday, March 21, 2008 9:15 AM by Lou Michels
It really wouldn't be appropriate for us to provide legal advice on an individual problem like this, and besides, this is not that kind blog. I suggest that you talk to an Iowa employment lawyer who could give you a take on what options are available.