Do references give real peace of mind to employers? References are often qualified by disclaimers, and processed by human resources staff who may never have met the people they relate to. Sometimes, references are there simply to enable an employer to preserve his insurance position. But what comfort do innocuous references afford insurers?

There is certainly no guarantee of the accuracy of a reference. Often an employer will write a good one to ease a troublemaker's departure, thereby avoiding potentially awkward employment problems. In addition to these situations, favourable references can be used as negotiating positions in termination talks. There may then be a conflict between the duty to provide truthful information to employers and the agreement struck.

Whispered allegations

The trouble with whispered and unfair confidences is that the victim is unlikely to establish the full facts without resort to litigation. Options for an aggrieved employee if economic loss results from a damaging reference include a claim for defamation or malicious falsehood, discrimination or harassment.