CHAUDHRI: Negative employer references may give rise to defamation claims

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While it takes decades to build, a reputation can be damaged in minutes – or in some cases, a single letter.

Paul Wurdell was employed by Paramount Safety Consulting Inc via an employment agency called Agilec.

Ultimately, Wurdell was terminated and he sued Paramount and its owner Ben Scipione for wrongful dismissal damages.

In the course of responding to Wurdell’s claim, the defendants produced documents including a May 6, 2020 letter from Scipione of Paramount to a G. Zylstra at Agilec. The letter discussed a purported conversation the two had that day and set out the reasons Paramount elected to terminate Wurdell.

Finding the letter to be defamatory of him, Wurdell amended his statement of claim to add a claim for defamation against both the defendants.

In November 2022, the defendants sought to strike out the claims of defamation in court, arguing in part the letter to the employment agency was not a publication and was not intended to be viewed by the public.

While the defendants were initially successful in striking out the claims of defamation, on appeal, Wurdell was successful in setting aside the decision and restoring his defamation claims. Wurdell was awarded $5,000 in costs on the appeal.

Wurdell’s lawyer and my former colleague Nick Papageorge, tells me the case is going to trial in November.

Defamation is a cause of action that few employees claim but in some cases, should absolutely consider.

When employees are terminated it is relatively common for employers to make both verbal and written references regarding the reason for the termination. If those references have a negative impact on employee reputation, defamation claims could succeed.

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In Wurdell’s case, it was only through the litigation process that he learned of Paramount’s letter to his employment agency. Had he not sued Paramount, he likely would have never learned of the statements it made about him.

Employment law is no longer simply a matter of money. Reputation protection and rehabilitation of terminated employees can be equally if not more important. It is becoming a leading priority in employment litigation.

Employers should consider themselves custodians of the reputations of former employees, taking good care not to make even casual statements regarding the reasons for termination, particularly if those reasons could be construed as negative.

Savvy employees will use wrongful dismissal litigation to uncover potential defamation claims, materially increasing damage claims and employer liability.

Have a workplace question? Maybe I can help! Email me at sunira@worklylaw.com and your question may be featured in a future column.

The content of this article is general information only and is not legal advice.