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On September 23, 2003, the Wisconsin Court of Appeals ordered an employer to pay $283,000 in compensatory and punitive damages to a former employee for making negative statements about that employee during a reference check. Gibson v. Overnite Transportation Company (Wis. App. 09/23/2003). Overnite had a conditional privilege under Wisconsin law. However, an ex-employee was able to prove defamation.
The Court of Appeals held Overnite liable even though the employer had a conditional privilege under Wisconsin law, Wis. Stat. §895.487, to make statements during a reference check. The Court held that in order to prove a claim of defamation, the employee only needs to show express malice, not actual malice. Actual malice requires the knowledge of false information or reckless disregard of the truth. However, express malice only requires ill-will, bad intent, envy, spite, hatred, revenge, or other bad motives against the person defamed.
In light of this decision, it is important that an employer and all of its agents (managers and supervisors) give accurate information that can be verified in reference checks. All opinions should be avoided unless based on objective and "provable" facts. A recommended process to minimize defamation claims is to provide the reference comments to the former employee in a written document before the information is provided to the company requesting the reference. The employee should acknowledge the accuracy of the reference comments by signing the reference statement. By obtaining the employee's signature on the reference statement, the employee is asked to waive all claims of defamation against the former employer if this information is submitted to a prospective employer in response to a reference check.
For more information about this important case and a Sample Reference Check Release Form, see our November 2003 Issue of the Month at www.krukowski.com.
For more information about defamation and other employment law issues, call Krukowski & Costello, S.C. at (414) 423-1330, or e-mail our educational services department.
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