Ah, reference letters, those elusive pieces of paper that can make or break a job seeker’s dreams. But here’s the deal: employers are not an employee’s personal fan club. They don’t have an obligation to shower employees with praise in the form of reference letters.

Before employers start feeling like kings on a throne, let’s explore the legal and strategic considerations surrounding reference letters and how they can impact an employer’s business.

No Obligation, No Problem

Let’s start with the undeniable truth: employers are under no legal obligation to hand employees a glittering reference letter, as affirmed by the Ontario Court of Appeal (2007 ONCA 573). So employers can rest easy, knowing that you’re not compelled to write letters of recommendation for every departing employee.

A Balancing Act

While an employer is not obligated to furnish reference letters, it’s essential to consider the bigger picture. Refusing to provide a reference letter could impact the court’s determination of the appropriate length of a terminated employee’s common law/reasonable notice period (1997 CanLII 4346 (BC SC), 2017 ONSC 5616). Remember, in assessing the length of an employee’s reasonable notice period, a court is essentially considering how long someone in the former employee’s position would take to find a comparable position, so having no reference letter could prolong an employee’s job search.

Keeping It Honest

When an employer does decide to provide a reference letter, they should make honesty their guiding principle. It may be tempting to paint a negative picture of employees who left on poor terms, but remember, integrity matters. Dishonesty can lead to disastrous hires for other organizations and tarnish the employer’s reputation.

Protection Through Prudence: Bad Faith, Beware

Sometimes, the absence of a reference letter can become an act of bad faith, especially if it leads to wrongful dismissal (2002 CanLII 15789 (ON SC)). So, employers, play it fair; don’t let your grudges cloud your judgment.

Final thoughts

As an employer, you wield considerable influence over your employees’ careers. While you have no legal obligation to provide reference letters, your decisions in this regard can leave a lasting impact on your company’s image and even lead to legal consequences. Strike a balance between honesty, prudence, and good faith, and you’ll find that reference letters can become a powerful tool to strengthen your business and foster positive relationships with both current and former employees.

If you need any assistance with departing employees, get in touch!