Have you ever had to fire or let an employee go for serious misconduct? Or maybe the former employee was let go for less serious reasons—often late or there has been a drop in their work production?
A common question we often see from managers and business owners is, “What am I allowed to say about the former employee?” Of course, this is most often in the context of your former employee seeking a job at another company and they reach out for a reference or proof of employment.
However, just as often we see those same disgruntled former employees asking, “How much bad-mouthing is my old boss allowed to get away with and say?”
Often job seekers believe the only people a company may contact are their references. However, employers have every right to contact any former employer regardless if they are or are not listed as a reference. And if you are contacted and asked about an employee you let go, you may share more than simply the former employee’s job title, dates of employment, and salary.
Many job seekers presume their former employer is legally restricted in what they are allowed to disclose to the new company that is seeking information about the applicant. And in some instances that may in fact be true, but for the most part, there are no federal laws restricting what a former employer can or cannot disclose about their former employees. Legally, as long as what you share about a former employee is true and not confidential you may disclose to the other company.
Now there are some exceptions to the ability to disclose anything so long as what you are saying about the former employee is true. Specifically, in Iowa, the information that may be shared must be work-related information. Unless the information began interfering with their work, you cannot and should not share personal information about a former employee.
Iowa also protects you and your business from potential liability by the former employee for sharing information with another company. However, the law will only protect you unless you share information which would violate the job seeker’s civil rights, you provide information which is not relevant to the inquiry being made, you disclose information without checking its truthfulness, or you give information to a person who has no legitimate interest in receiving it.
Truthfulness is key. So long as you are not sharing confidential or non-protected information as shown above, you are safe to disclose. The truthfulness of what you are disclosing is so important because if it is not the truth, you could be liable for defamation.
A former employee could sue you for damaging their reputation. For example, if a former employee was terminated because they were constantly late to work, it would be unwise to speculate and even jokingly suggest to another that, “Well, I think he had a hard time getting up in the morning because he’s a drunk.” That could definitely open you up to a lawsuit.
So, remember to be truthful. If you are contacted and are unsure of what you can say about a former employee, we recommend that you consult with an attorney before you respond.