Bad Reference for Ex-Employee Judged Defamatory

JAMES GIBSON, an employee of Overnite Trucking Co., resignee to work for USF Holland, another trucking firm. During his probationary period with USF, the company contacted Overnite as part of a reference check. USF was advised by an Overnite manager that Gibson would never be rehired because he had been late most of the time, regularly missed two to three days a week, had a “problem with authority,” had a questionable work ethic and attitude and was not trustworthy.

After he was terminated by USF, Gibson sued Overnite for defamation, claiming that he lost his job with USF because of the report it had received from the Overnite manager. A jury awarded him $283,000 in damages, which included $250.000 for punitive damages.

On appeal, Overnite argued that the verdict should be reversed because a state law provides that an employer is immune from civil liability for providing a job reference unless it acts maliciously.

The Wisconsin appeals court found that, contrary to the report given to USF by the Overnite manager, Gibson's personnel file at Overnite contained no reprimands or record of problems with his job performance. Therefore, it affirmed the jury verdict because Overnite's manager had made the statements solely from spite or ill will. Gibson v. Overnite Transp. Co., Wis. Ct. App., No. 02-3158 (9/23/03).

Impact: To limit liability, employers should disclose only minimal factual information about former employees.