Concept and Impact on Employment - Essay Example

?Referee’s Liability: Its Concept and Impact on Employment The practice of requiring a person seeking employment (hereafter referred as to provide work or school references is customary. It is an effective means of ascertaining that the person is a perfect fit in the organizational structure—the skills set matches the needs of the employer. Thus, the information provided by the maker of the reference (hereafter referred as referee) is usually received by the recipient as Gospel truth. In issuing a reference, to whom does the referee owe fidelity: to the subject or the recipient? Should the subject disagree with the contents, on what grounds can it be challenged and may the subject claim compensation for any misinformation? The discussion in this paper shall deal with the liability of referee to the subject only. There is no law which specifically confers the right to demand for a reference thus there is no mandatory duty to issue one. It is not a matter of right but a mere privilege which may be stipulated in a contract or agreement. Without any contract, the discretion to give reference lies with the referee however there are instances when the refusal to issue reference is construed as discriminatory that compels the employer to issue one. Assuming the referee voluntarily agrees to issue a reference, it has legal obligation to the subject and the recipient to give an honest, truthful and fair account of the information it has in its possession. The award of damages which do not arise from actual physical injury or damage to property is frowned upon (Murphy v. Brentwood District Council, 1990). This is against public policy and the floodgates arguments (Spartan Steel and Alloys Ltd v. Martin & Co. Ltd,1973) where courts will be inundated with gratuitous suits. The exception from this general rule is when misleading statements are contained in the reference which resulted in economic loss then the aggrieved party may demand compensation for such breach of duty. For duty of care to exist nonetheless the standards enunciated in the leading case of Caparo Industries v. Dickman (1990), must be complied with: the injury or damage suffered by the aggrieved party was reasonably foreseeable; sufficient proximity or special relationship between the parties; and it is fair, just and reasonable to impose liability. These elements are mandatory and concurring where the absence of one element negates the existence of duty of care. It is not sufficient that the referee made derogatory remarks that damaged the reputation of the subject it must be shown that the referee has a special relationship with the subject such as that of an employer and employee or that of university official towards their personnel or students. If the derogatory remarks was relied upon to reject the subject’s engagement, the imposition of liability is just, fair and equitable. The case of Spring v. Guardian Assurance (1995), is illustrative. The employer imputed dishonest conduct which became the basis for denying the employee’s employment which was later discovered to false. The court enjoined employers to exercise utmost diligence in the preparation of reference so as not compromise the economic prospects of subjects and take due care to protect the subject’s reputation. The court stated a caveat the referee should exercise due skill and care in the preparation of the reference before making it available to the third party since the recipient accord great importance on the reference issued. The referee must showcase the subjects’ skills and expertise to improve their employment prospects and not diminish it by imputing sordid personal traits. The value accorded the reference is due to the referee’s personal observation on the subject and if the subject is not personally known to the referee, the reference should be based on recorded facts. If a mediocre reference with unproven allegations is disseminated to prospective employers contrary to the subject’s qualifications warrants the award of damages. The right of the employee to accurate reference continues even after the engagement ceases. The case of McKie v Swindon College (2011) is relevant. The issue did not stem from the reference issued by the employer but on an email sent by one of its officers long after the employee had ceased employment from them. In previous rulings, the courts applied duty of care only where the potential employer relied on the information that brought economic loss for the employee. The circumstances in McKie’s case are quite unique. The relationship between McKie and its former employer is already far too remote to establish a special relationship—Swindon was a former employer but not the proximate employer. The informal talk initiated by Swindon employee addressed to the officer of McKie’s present employer suggested that McKie committed acts of impropriety while still employed at Swindon. Based on this unverified informal talk, McKie was summoned to explain resulting in his resignation. It was held that the careless talk engaged by Swindon brought a degree of proximity into their relationship that ripened to a duty of care resulting in the award of damages. The lapse of many years will not preclude indemnify to the aggrieved party if it is proven that the far removed employer committed a breach which needed to be rectified. In Hedley Byrne & Co Ltd v. Heller & Partners Ltd (1964) it was held that a duty to care was created when the information was requested regarding one of its clients was found incorrect. The information was found incorrect making the issuer liable however it was absolved from liability since a disclaimer accompanied the information. In Bullimore v. Pothecary Witham Weld Solicitors, a firm of solicitors were held liable for future lost earnings by giving bad reference. The Employment Appeals Tribunal declared that the withdrawal of the employment offer was reasonably foreseeable but emphasis is given on the fact that the withdrawal of offer was a direct effect of the information provided. It is clear that references are subjective and may not be truly reflective of the competence of the person whom the reference is written. References are prone to personal bias which should simply be treated as a source of information to establish the subject’s employment history, qualifications, position and job description but not an affirmation of suitability for the position applied for. Independent means should be employed to ascertain the subject’s suitability to the position—not a means to gather subjective information to be used as a weapon to reject a subject’s employment. A misleading reference can likewise be a means to perpetuate injustice to the subject by issuing a disclaimer. The reputation of the subject will be ruined without accountability of the referee. The referee must be held liable otherwise freedom of speech will utilized with impunity. So also, the information imparted must be handled with due care mindful of the rights of the subject to privacy in consonance with the Data Protection Act of 1998. It is the duty of the referees to safeguard the personal information of the subject otherwise unauthorized release of information shall be dealt with severely. References: Bullimore v Pothecary Witham Weld Solicitors & Anor [2010] UKEAT/0189/10/JOJ, [online] Available at: http://www.employmentcasesupdate.co.uk/site.aspx?i=ed6087 [Accessed on November 24, 2011] Caparo Industries v. Dickman [1990] 1 All ER 568, [1990] UKHL 2, [1990] 2 AC 605, [online] Available at: [Accessed on November 24, 2011] Desmond v. Chief Constable of Nottinghamshire Police [2011] EWCA Civ 3; [2011] WLR (D) 1 Hedley Byrne & Co Ltd v. Heller & Partners Ltd [1964] AC 465, [online] Available at: [Accessed on November 24, 2011] McKie v Swindon College [2011] EWHC 469 (QB), [2011] All ER (D) 128 (May), [online] Available at: http://www.employmentcasesupdate.co.uk/site.aspx?i=ed8339 [Accessed on November 24, 2011] Murphy v. Brentwood District Council [1990] 2 All ER 908, [online] Available at: [Accessed on November 24, 2011] Parliament of the United Kingdom. 1998. The Data Protection Act, [online] Available at: http://www.legislation.gov.uk/ukpga/1998/29/contents [Accessed on November 24, 2011) Parliament of the United Kingdom. 2000. The Freedom of Information Act Spartan Steel and Alloys Ltd v. Martin & Co. Ltd [1973] 1 QB 27 Spring v. Guardian Assurance Plc [1995] 2 A.C. 296 Read More