April 2013

It seems understandable that even if an employee leaves on bad terms the employer might want to take the high road and give that employee a positive employment reference. Call it “Minnesota nice.” But a recent federal court decision found that an employer’s glowing reference given for an employee it had terminated, undermined its position in court that the termination was justified based on the employee’s misconduct. The result was that the employee was allowed to proceed to trial with claims of age discrimination.

In Kragor v. Takedo Pharmaceuticals of America, Inc., the court held that a positive reference the employer gave to a prospective new employer for its recently terminated employee, contradicted its defense in court that the employee was lawfully discharged for misconduct. These differences between what the employer represented in court, versus what it said to a third party seeking a job reference, was enough for the court to allow a trial on the employee’s claim that the real reason for her termination was age discrimination.

In this case, the employer’s vice president claimed he terminated the 49 year old plaintiff from her sales position because she violated company policies on giving customers gifts. The employer then replaced the employee with someone younger. However, when another potential employer inquired about the plaintiff, the vice president said the plaintiff was an exceptional employee, did nothing wrong, did everything right, and should not have been fired. The vice president’s excessively candid and shifting position on whether termination was justified, was enough for the court to leave it to a jury to decide the validity of the employer’s defense.

Employers may want to assist a former employee – even one terminated for misconduct – in their search for a new job. Helping a former employee move on and secure new employment may actually lessen the likelihood of an individual challenging his or her termination by alleging a wrongful discharge claim. However, as this case demonstrates, helping a former employee find a job may actually wind up also helping that person in a lawsuit against the employer!

Minnesota nice works wonderfully in our fine state. Unfortunately, in the area of workplace law employers cannot afford to have inconsistent or shifting reasons for discharging an employee. This case serves to warn employers that this rule applies even to job references given to third parties after termination has taken place.

For experienced guidance in dealing with inquiring employers and crafting policies and procedures dealing with employment references that do not provide a former employee with information to further any potential cause of action against you contact: James B. Sherman at (952) 746-1700, or email jasherman@wesselssherman.com or chstaul@wesselssherman.com.