Fired fraudster sues over reference check

What should companies say when they get reference calls about a former employee who was fired for misconduct? A recent court ruling offers some help:
An employee’s boss caught him tampering with the company payroll system to lower his federal tax withholding. His actions were against company policy, and he was fired.
Eventually, the manager got a call from another employer asking for a reference for the former employee. He told the caller the man had been fired for misconduct.
The prospective employer asked the employee to sign a release so it could get more information about his termination. He refused and didn’t get the job.
He sued his former employer for interfering with his job search.
The company argued it was simply telling the truth and couldn’t be held liable. The court agreed.
Companies can’t be held liable for giving truthful information, even if it causes harm to a former employee.
Note: Not all courts follow the same standards when former employees sue over negative references, so companies should always proceed cautiously and follow their own established policies. But rulings like this offer some reassurance to HR pros.
Cite: Luttmann v. Tiffany and Co.