In Ontario, employers are protected from defamation lawsuits by a legal defence called qualified privilege. This means you can legally give honest, negative feedback about a former employee to a prospective employer, provided you genuinely believe the information is true and you do not act out of malice.
For business owners and managers in cities like Hamilton, London, and Kitchener, receiving a phone call asking for a reference on a former employee can trigger instant anxiety. If the employee was chronically late, insubordinate, or incompetent, you naturally want to warn the prospective employer. However, the fear of being hit with a massive defamation lawsuit prevents many managers from speaking the truth. To balance this, Ontario common law relies heavily on the concept of qualified privilege. This legal principle recognizes that society benefits when employers can speak freely and honestly about a worker’s qualifications without the constant fear of litigation.
While qualified privilege is a powerful defence under provincial law, it is not an absolute shield. 💵 If you mishandle the reference check, you can lose this protection. If a court finds that you lied or acted out of spite, your company can be held liable for substantial damages. This guide outlines how to handle reference requests safely, maintain your qualified privilege defence, and protect your business from legal liabilities.
Step-by-Step Process for Giving a Safe Reference in Ontario
Providing a reference requires a careful, professional approach to avoid violating privacy and defamation laws. Here is the step-by-step process that HR professionals use across Ontario.
Step 1: Obtain Explicit Written Consent
Never give a reference unless you are absolutely certain the former employee has authorized it. 📝 Ideally, the prospective employer should provide you with a signed consent form or release from the applicant. If you start volunteering negative information about an ex-employee to people who never asked, you immediately lose your qualified privilege and open your company up to severe privacy and defamation claims.
Step 2: Stick Strictly to Documented Facts
When providing negative feedback, rely on objective paper trails rather than personal emotions. If the employee was fired for attendance issues, say: ‘Their employment was terminated after receiving three written warnings for unauthorized absences.’ Do not say: ‘They were incredibly lazy and hated working.’ Facts are easily defended in the Superior Court of Justice; subjective insults are not.
Step 3: Avoid Malice at All Costs
Malice is the absolute destruction of qualified privilege. 🚫 If a judge determines that your primary motive for giving the bad reference was a desire for revenge, spite, or to intentionally ruin the person’s career, your legal defence instantly evaporates. Keep your tone strictly professional, objective, and emotionally detached during the phone call.
Step 4: Answer Only what is Asked
Do not go off on tangents or share unrelated personal information. If the hiring manager asks about technical skills, answer only about their technical performance. Sharing irrelevant gossip about an employee’s personal life or lifestyle choices is highly dangerous and can easily be interpreted as malice in a court of law.
Step 5: Document the Reference Call Details
Immediately after the call, write a brief memo detailing who you spoke with, when the call occurred, and exactly what information you shared. Keep this note securely in your HR records. If the candidate later sues, having a detailed, contemporaneous record of the conversation is incredibly valuable for your defence lawyer.
How Much Does a Defamation Defence Cost?
Even if you are completely in the right and protected by qualified privilege, simply defending your company against a frivolous defamation lawsuit is a massive financial burden. 💰 Here are the typical costs of defending a claim in Ontario.
- Initial Defence & Retainer: Filing a Statement of Defence and assessing the defamation claim typically costs between $5,000 and $10,000 CAD.
- Motion to Dismiss: Attempting to have the judge throw out the case early based on qualified privilege can cost between $15,000 and $25,000 CAD.
- Full Defamation Trial: The cost of going to a full trial in the Superior Court of Justice can range from $40,000 to over $100,000 CAD depending on the complexity of the case.
How Long Does the Legal Process Take?
If an angry former employee sues your company for a bad reference, resolving the matter requires significant patience. If your employment lawyer files a strong motion highlighting clear qualified privilege, the case might be dismissed or settled out of court within 6 to 12 months. However, complex defamation trials involving deep financial losses for the employee can tie up your management team in litigation for 2 to 4 years.
Frequently Asked Questions (FAQ)
What exactly constitutes ‘malice’ in Ontario law?
Malice means acting with a dominant motive of spite, ill will, or revenge. It can also be proven if you recklessly share information that you know is false, or if you share the negative feedback much more widely than was necessary (like posting it on social media instead of just telling the hiring manager).
Can an ‘off-the-record’ phone call protect me?
No. Saying ‘this is strictly off the record’ means absolutely nothing in a court of law. If the prospective employer takes notes during your call and the applicant later sues, those notes can be subpoenaed as evidence against you in an Ontario court.
Is it safer to just refuse to give references entirely?
Yes, from a purely legal risk-management perspective. This is why many large corporations in Canada use a strict ‘Name, Rank, and Serial Number’ policy. They only confirm employment dates and the final job title, completely removing the risk of a defamation lawsuit.
Can an employee sue me if I give a good reference but they still don’t get the job?
It is highly unlikely. To win a defamation lawsuit, the employee must prove that the statements made were defamatory (harmful to their reputation). If you only said positive things, they have no legal grounds for a defamation claim, regardless of the hiring outcome.
Leave a Reply