Sometimes, an employee may decide to leave their job for another position. To support their career move, they may ask for a job reference.
Whilst their departure might be disruptive for you, employers should remain professional when it comes to giving references. If you don't, you could end up facing discrimination claims, along with reputational damages.
In this guide, we'll look at what giving references means, whether it's a legal right, and how to provide a fair and accurate reference.
What is a reference?
A reference is a statement that presents an employee's work skills or personal character.
Job references will usually share a person's best attributes or highest achievements. They can also declare a candidate's weaknesses or bad habits. In the end, these details help to improve and grow an employee's career.
What are the benefits of giving a reference?
Giving a reference is beneficial for current or former employees - it's good for you and your business, too. References help with things like:
Authenticity
They allow the new employer to gain authenticity when reading CVs and cover letters. Employers can gain a better idea on who the person is and how they work.
Credibility
They help confirm a new employee's achievements and experiences. They can show their track record with confidence - as they have enough referees to back up their work history.
Relationship status
They also help keep a good relationship between both the employee and their former employer. They open channels of communication should a future employer need it. And it shows that the new employee has nothing to hide in terms of their employment history.
Are there different types of job references?
Yes, there are different types of job references an employee can use. They'll vary depending on what their prospective employer requires for their new job role.
Let's take a look at a few examples:
Professional reference
A professional reference outlines an employee's work achievements at their current job. They're also known as a factual reference.
These are usually written by a direct line-manager or their former employer themselves. They can cover basic details or go into further depth.
Professional references will usually include details like, the candidate's abilities, employment information, and answers required for the future employer.
Character reference
A character reference is usually used when a person lacks relevant work experience or hasn't been in work for a while. They're also known as a personal reference.
A character reference is usually written by a person who knows the employee well - but hasn't worked with them. For example, a mentor, friend, or community leader. These people will be able to talk about the employee's good qualities or ethics.
Do you legally have to give a reference to a prospective employer?
No, it's perfectly lawful for an ex-employer to not provide a reference to a new employer.
The only time you must give references is when:
- It's part of an employee's contract. (For example, as a settlement agreement during an employment termination).
- It's used for certain financial service jobs regulated by relevant authorities. (For example, like the Financial Conduct Authority or FCA).
If your reference is inaccurate or deliberately misleading, it could account for defamation. The employee could claim damages for this. And it could also lead to a constructive or unfair dismissal claim if there's evidence of this.
If an employer refuses to give a reference, their decision must not be discriminatory. Under the Equality Act 2010, your decision cannot go against a person's protected characteristics. For example, refusing to give a reference because of their religious beliefs, race, or sexuality.
How to give a fair and accurate reference
Even though it's not a legal duty, it's considered good practice to provide references. It allows their prospective employer to gain an initial image of a candidate - before accepting a job application or conditional offer.
Make sure employees know how to request reference checks and details. That way, you can help them secure a new job title quickly and efficiently. Let's look at how to give a reference fairly and accurately:
Create a reference policy
The first step to take is creating a policy on giving references.
The policy should present the process of giving out a good reference. It should state what the steps are, who will write them, and how they will be sent to a potential employer.
Whatever your reference rules are, add them to your business documentation. For example, employment contracts, handbooks, and other related policies.
Write a reference letter
The next step is to write a letter of reference. Decide what type of reference you'll use; maybe just a basic one or an in-depth factual reference.
The letter should include:
- Description of the referee relationship.
- Name of the previous company and job title.
- Employee's contact details (address, email, phone number).
- Description of the employee's work history and achievements.
Provide an accurate and fair reference
You must take reasonable care to provide a reference that's accurate of the employee's job performance. The employer owes this to the employee and prospective employer.
Avoid sending misleading or irrelevant personal information to the new employer. For example, if an employee was investigated for theft - but was found innocent - it's best not to mention it.
Their previous employer shouldn't include things like medical records or criminal charges. This is done if it's related to the job offer (i.e., for safeguarding issues) or after gaining the employee's consent.
Provide a copy to the former employee
An employee can ask for a copy of the reference sent to their new employer.
Even if they didn't request it, it's always best to provide them with a copy. This helps to promote openness and professionalism up until their last days with you.
A reference counts as personal information; meaning they must be kept confidential. Only share them with appropriate people and departments (like HR). Make sure you comply with data protection and freedom of information laws.
Get expert advice on giving references with Peninsula
Many employers see the benefit of giving good references. They help employees gain a job offer - without causing any potential losses or disruption to your business.
But if you give a misleading or bad reference, you could end up with more impacts than just losing one employee. For example, you could end up facing discrimination claims, along with reputational damages.
Peninsula offers expert advice on giving references. Our HR team offers 24/7 HR employment advice which is available 365 days a year.
Want to find out more? Get advice from one of our HR consultants. For further support, call our telephone number 0800 028 2420.
