Reference Letters: Some general advice

When employees are terminated, whether with or without just cause, whether or not they will get a reference letter often becomes a matter of dispute between the parties.

Primarily, an employee will be concerned with obtaining a fair settlement with respect to pay in lieu of reasonable notice. Often the next thing they will be concerned about is a reference letter. Employees who have been terminated should know that surveys of human resource managers have shown that reference letters are not as important to obtaining a new job as job hunters might think. Most human resource managers want to talk to your previous employer. It appears that human resource managers feel, perhaps rightly so, that reference letters alone can be misleading.

Most employees, however, still believe that a reference letter is critical. This can put employers in a conflicted situation. While the employee may not have been guilty of misconduct to the degree that they would not be entitled to pay in lieu of notice, the employer may have been totally dissatisfied with their performance. Most employers do not want to sign a reference letter which is dishonest.

I routinely caution employees not to make too big a deal out of the issue of a reference letter. If the employee cannot trust the person who signed the reference letter to corroborate completely over the phone the positive things said in a letter, the employee should never show that reference letter to a prospective employer.

As a practical matter, employees will never be able to prove or even know what was said by their former employer in that telephone conversation. Even if nothing negative is said, by a pregnant pause or the tone of voice used by the prospective employer, worlds can be communicated.

Imagine this exchange:

Prospective employer: "You have said a lot of positive things about George in his letter of reference, would you ever consider rehiring him if you had work available?"

Former employer: "Well...ah...maybe?"

This prospective employer will not be calling George back for a second interview.

There are no perfect solutions to this dilemma. The employer rarely wants to keep their former employee from getting a new job but at the same time does not want to mislead a potential employer. When I am representing the employer in this kind of situation and the employee is insisting on a reference letter to settle their claim, I recommend a letter that looks something like the following:

To Whom It May Concern:

George Smith was in the employ of ABC Electronics from 1991 until January of 2002. He held the position of Service Technician. In this role, he carried out a variety of repairs on electronics equipment serviced by our organization. George was very competent with respect to his area of expertise and was always able to learn new skills quickly.

George has the ability to work quickly under pressure and has experience in prioritizing his work. As a result of my busy work schedule, I cannot respond to verbal requests for references but must limit my reference for George to this letter.

Yours sincerely, former employer.

Everything in this letter is true, except, perhaps, for the last line. It does not mention that George was continually late for work and often absent and therefore had to be able to work quickly and prioritize his work in order to keep the job as long as he did. It does not give a reason for the termination; that is left to George to explain to the prospective employer. Most importantly, the letter excludes the possibility of the employer getting a call from the prospective employer in which more pressing questions might be asked.

Frankly, some employers are not even willing to consider issuing a letter such as the one above. They feel if they do not tell the entire story, they should not comment at all. Sometimes employers such as this change their mind when I ask them why they kept George on for over 10 years if he had no positive qualities whatsoever.

The point is that the letter does not say anything that is untrue. Most importantly, George can use this letter in his job hunt without worrying that a call will be made to the former employer and his chances of getting a new job will be destroyed.

It is not a perfect solution, but it may very well be the best solution available in the circumstances.

Employers who get cold feet at the thought of providing any reference to a former employee with whom they were not satisfied should keep one very important factor in mind; unless a severance package is agreed upon immediately, the longer George is unemployed, the more damages for lost wages the employer will be required to pay. This obligation is not endless. There will be a limit to the notice to which George is entitled based on his age, seniority and level of responsibility. If George, however, could have been entitled to up to seven months reasonable notice, but gets a job after three months as a result of being able to provide a prospective employer with a meaningful reference, the former employer will end up with more cash in the bank as a result.

As published in the Hamilton Spectator, January 7, 2002. Ed Canning practices labour and employment law representing both employers and employees with Ross & McBride LLP.