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Michigan Litigation Law | How to Handle Employer References With Bad Employee

Michigan Has Unique and Complex Laws Regarding the Requirement to Provide Truthful References About a Previous Employee.

Employers' Privilege to Disclose Information Regarding Former Employee

Michigan employers have a qualified privilege to disclose in good faith documented information regarding a former employee’s job performance. MCL 423.452 provides as follows:

An employer may disclose to an employee or that individual’s prospective employer information relating to the individual’s job performance that is documented in the individual’s personnel file upon the request of the individual or his or her prospective employer. An employer who discloses information under this section in good faith is immune from civil liability for the disclosure. An employer is presumed to be acting in good faith at the time of a disclosure under this section unless a preponderance of the evidence establishes 1 or more of the following:

(a) That the employer knew the information disclosed was false or misleading.

(b) That the employer disclosed the information with a reckless disregard for the truth.

(c) That the disclosure was specifically prohibited by a state or federal statute.

Why Qualified Privilege?

  • Qualified privilege provides substantial protection against defamation claims arising out of post-termination employer disclosure of employee misconduct.

  • However, employers are not free to create and disclose ad hoc descriptions of an employee’s conduct or performance.

    • The statute covers only “job performance” information that is “documented in the individual’s personnel file.”

Should Employers Help Terminated Employees Find Work?

  • When the termination of an employee does not involve dishonesty or moral turpitude, and when the employer perceives that the individual terminated may be a valuable asset to another employer, offering services and assistance in finding alternate employment is a reasonable part of the termination process.

  • WATCH OUT!

    • employers who affirmatively push employees into the employment stream by praising employee strengths and withholding known information about the employee’s adverse character and behavioral history may well breach an implied obligation to potential future employers and others.

  • A one-sided disclosure, coupled with selective withholding of adverse information, may be considered false and misleading and result in an action against the employer for fraud or negligent misrepresentation. See, e.g., Kadlec Med Ctr v Lakeview Anesthesia Assocs, 527 F3d 412 (5th Cir), cert denied, 555 US 1046 (2008); Randi W v Muroc Joint Unified Sch Dist, 929 P2d 582 (Cal 1997).

  • Even if there is no duty to disclose a particular fact, choosing to speak obligates the employer to say enough to prevent the communication from misleading the other party. Grozdanich v Leisure Hills Health Ctr, Inc, 25 F Supp 2d 953, 989–990 (D Minn 1998).

Defamation Claims by Former Employee?

May an Employer Issue a Press Releases Regarding An Employee's Termination?