When giving employment references, you can reduce your risk of being sued for defamation if you keep in mind the following key points:

• Be truthful. If your statements are true, they are not defamatory. For this reason, refrain from making any statements that you are not prepared to back up and substantiate if you are sued. Give objective facts or opinions and conclusions that you can support with objective facts, rather than mere allegations, speculation, or gossip. For example, you can safely state that an employee was fired for missing too many days of work. However, once you start providing unsubstantiated opinions on reasons for the absenteeism, such as that the employee was drinking too much or was into illegal drugs, you increase your risk of being sued.
• Be clear and unambiguous. Keep in mind that statements that are technically true may still be defamatory if they are incomplete or misleading. For example, an employer stated that an employee was fired for drug use but neglected to state that the employee's refusal to hire a supervisor's relative also contributed to the firing decision. The incomplete statement was defamatory because it unduly emphasized the employee's improper conduct. If you should decide to discuss why an employee left your business, state the reasons in objective and specific terms. Refrain from stating that an employee was terminated "for cause," "insubordination," "unsatisfactory performance," or other nonspecific reason, because such phrases may be defamatory by implication.
• Be objective. The tone of your statements is also important. Your references should not sound petty, vindictive, or accusatory. No matter how trying your relationship with the former employee may have been, you should try to discuss the facts in an objective, nonmalicious way.
• Be responsive. References should be limited in scope to information that the inquiring employer requests. This does not mean that you should feel compelled to provide all requested information, because generally you're under no legal obligation to provide employment references at all. Rather, the notion here is that you should not volunteer any unfavorable information that is not requested.
• Stick to job-related facts. Do not provide any information that is irrelevant to the employee's performance or behavior in the workplace. Comments about an employee's personal life are especially hazardous, because even if the comments are true, they may raise invasion of privacy issues.
• Be selective in choosing your audience. Limit your disclosure of employee information to those persons who have a legitimate interest in that information. A statement that is not defamatory when made to a prospective employer may be defamatory if it is made to friends, spouses, employees, or others who have no business reason to know the information.
• Limit telephone references. Because you need to be sure that a person to whom you are providing an employment reference has a real business interest in receiving the information, you should use care in providing references over the phone. Unless you are going to limit your references to basic employment data, at a minimum you should arrange to provide the information in a return call. This will give you an opportunity to verify who the caller is. The better alternative is to have the caller make the reference request in writing.
• Get signed releases or consents. Your best protection against defamation and other claims that may arise from giving employment references is to get the former employee to consent to your release of information.