Do you have to provide one?
There is no specific law that deals with references, nor is there generally any obligation on you as an employer to provide one. However, it is rare for employers to refuse.
In sectors where employees are subject to special rules (such as finance) and cannot get a job without a reference, the courts have said that there is an implied term in the contract that employers will provide one (Spring v Guardian Assurance, 1994). Indeed, the Financial Services and Markets Act 2000 Act now requires employers who provide financial services to supply references.
Once you do agree to give someone a reference, what you write has to be accurate and truthful, according to the court in Bartholomew v London Borough of Hackney. However, it does not have to be full and comprehensive.
The court said much the same thing in Kidd v Axa Equity and Law Assurance Society plc - that although references must not mislead (otherwise you leave yourself open to a claim of defamation or negligence), they do not have to be comprehensive.
The reference must not give an unfair or misleading impression overall, however, even if what you say is factually correct.
Does your employee have the right to see the reference?
No, employees do not have the right to see the reference, unless they make a claim of some sort against you and ask the court to order disclosure (a process whereby you have to provide certain documents). Whether the court orders disclosure will depend on all the circumstances of the case.
It is also worth noting that if someone makes a claim of discrimination, they could ask to see a copy of the reference using a discrimination questionnaire.
Is the Data Protection Act relevant?
Yes. Although confidential references are exempt under the right of access to information under the Data Protection Act 1998, employees can ask their new employer for a copy of the reference. They have a right to disclose it to their new employee, but ideally they should ask the person who wrote it for their consent first.
Some reference requests ask for information about the prospective employee's sickness absence. As data relating to an employee's health is classified as sensitive personal data, you need to get your employee's consent before you disclose this information.
Is it discriminatory to refuse an ex-employee a reference?
The House of Lords said in Relaxion Group plc v Rhys-Harper that discrimination legislation (although only applicable to sex, race and disability at that point) applies post employment.
In relation to references, that means that employees can challenge references that are inaccurate or misleading in a tribunal on the grounds that they are discriminatory.
However, this right cannot extend indefinitely. To be safe, you should stipulate a length of time after which you will not provide references to ex-employees.
Do you have to disclose convictions?
Under The Rehabilitation of Offenders Act 1974, job applicants do not have to give information regarding any previous convictions (whether "spent" or not). Nor do referees.
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To succeed in a constructive dismissal claim, employees have to show that their employer fundamentally breached a term of the contract. In Claridge v Daler Rowney Ltd, the Employment Appeal Tribunal (EAT) said that mishandling a grievance did not amount to a fundamental breach unless the employer had acted unreasonably and in a way that was likely to seriously damage or destroy the employment relationship.
What happened?
In June 2006, the production manager (who had seen Mr Claridge leave the production line early on more than one occasion) asked him to attend a meeting. Mr Claridge thought he had been demoted and went off sick with depression.
He then lodged a series of grievances which did not take place until February the following year. Mr Claridge was finally told in July that his grievance had not been upheld because he had not been demoted. He resigned on 2 August and claimed constructive dismissal, arguing that his grievance had not been dealt with properly or "in a timely fashion" which amounted to a breach of his employer's duty not to undermine the trust and confidence in their relationship.
The tribunal decided that the initial delay (from June to February) was not the company's fault, but that the delay in subsequently informing Mr Claridge of the outcome of his grievance was unacceptable. However, applying the test set down by the EAT in Abbey National Plc v Fairbrother, it said that the dismissal was fair as it fell within a band of reasonable responses, given the grievance procedure adopted by the company as a whole.
The EAT said that tribunals must be satisfied that the employer's conduct was "calculated to destroy or seriously damage" the employment relationship. It also made clear that employees should not be able to satisfy that test unless the employer's behaviour fell outside the range of reasonable responses.
In constructive dismissal cases, the EAT concluded that if a tribunal thinks the employer's conduct could fall within the "range of reasonable responses" test, then the employee cannot satisfy the requirement to show a fundamental breach.
Using that approach, the EAT decided in this case that the company acted reasonably throughout the process (as other reasonable employers would have acted in the same way), and Mr Claridge's claim could not, therefore, succeed. This was not to say the grievance could not have been handled better, but simply that the company had behaved in a way that another reasonable employer might well have behaved.
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It is unlawful to directly or indirectly discriminate against someone because of their age, unless the employer can justify it. In Rolls Royce plc v Unite the Union, the High Court said that length of service in a redundancy selection policy was a justifiable criterion for redundancy selection.
What happened?
The union had negotiated two collective agreements on redundancy with the company many years before the introduction of the age regulations. Although it was opposed to compulsory redundancies, it accepted that there could be circumstances that required a framework "to enable peaceable restructuring and fair selection of affected employees."
As part of the selection process, every employee was scored under five criteria and also received one point per year of continuous service. Points were deducted for unauthorised absences and those with the fewest points were selected for redundancy.
With the introduction of the age regulations, Rolls Royce argued that using length of service would unlawfully discriminate against younger workers but Unite disagreed and both parties asked the High Court to adjudicate.
The High Court agreed with the union. It said that it was in the interests of both parties that the redundancy exercise was carried out fairly and "peaceably" and that this, in itself, was a legitimate business aim.
In its view "the criterion of length of service respects the loyalty and experience of the older workforce and protects the older employees from being put onto the labour market at a time when they are particularly likely to find alternative employment hard to find".
It concluded, therefore, that the parties had agreed a scheme that allowed Rolls Royce to succeed in a defence to an age discrimination claim under regulation three, as "the legitimate aim is the advancement of an employment policy which achieves a peaceable process of selection agreed with the recognised Union".
In any event, the High Court said that this agreement fell within regulation 32 (which allows employers to put one worker at a disadvantage in comparison to another worker "in relation to the award of any benefit" based on length of service, as long as this fulfils a genuine business need"). Contrary to what the employers had argued, there was no reason to interpret the phrase "award of any benefit" narrowly and it was certainly a benefit to remain in employment when other people lost their jobs.
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A revised code of practice on discipline and grievance handling in the workplace is now available on the website of Acas (the government's conciliation service). The government is proposing that the current statutory disciplinary and grievance procedures be abolished with effect from April 2009 and replaced by this non statutory code.
The code provides basic practical guidance to employers, employees and their representatives and sets out principles for handling disciplinary and grievance situations in the workplace.
Employers are not obliged to follow the code, but tribunals will take it into account when considering relevant cases. Tribunals will be able to adjust any awards by up to 25 per cent if an employer or employee unreasonably fails to follow any provision of the code.
The revised code will be complimented by a non-statutory Acas guide providing more detailed good practice advice. This contains sample disciplinary and grievance procedures. Unlike the code, employment tribunals do not have to take account of the guidance booklet.
The drafting of the revised code of practice was one of a number of recommendations which came out of the Government review of workplace dispute resolution carried out last year.
To download a copy, go to: www.acas.org.uk
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