Regarding the propriety of legislation in Arkansas which would preclude an employer who is asked for a job reference for a former employee from having liability except for intentional false statements made about that employee to a prospective employer. ANSWER: Such legislation would not impact sui

Cary . oo . STATE OF ARKANSAS OFFICE OF THE ATTORNEY GENERAL Af l We ’ JUSTICE BUILDING, LITTLE ROCK 72201 ee (501) 371-2007 " STEVE CLARK ATTORNEY GENERAL OPINION NO. 86-258 April 29, 1986 The Honorable Mike Beebe State Senator 211 Arch . Searcy, AR 72143 Dear Senator Beebe: This is written in response to your request for an Opinion concerning the propriety of legislation in Arkansas which would preclude an employer who is asked for a job reference for a former employee from having liability except for way intentional false statements made about that employee to a . prospective employer... . ij As you note in your letter, the threat of civil litigation nf . for unfavorable employment recommendations has become of concern to employers in Arkansas and. nationwide. . You state that you're interested in the possibility of Arkansas enacting a law which would limit an employer's liability and also for us to relate any problems we might envision with 2 such- legislation...- ~+ NE ME Te tee eres Our research indicates that increasingly, causes of action against former employers are brought in federal court ‘pursuant to 42 U.S.C, §1983, a civil rights statute which sprecludes deprivation of the constitutional rights of an... 7 individual under cglor of state law. *:O£ course, one of the .. __.;, reasons for this burgeoning of civil rights litigation is ©. ~ that Congress has authorized attorneys who bring such actions and prevail to obtain attorneys fees under 42 U. S. C. . ° $1988. .The cases reviewed show that former employees who -. ‘are given negative job references sue their former employers under §1983 for deprivation of their "liberty interest" in their good name and reputation without due process of law. Also, a defamation action, pendent to the federal claim, is . usually brought against the former employer in conjunction The Honorable Mike Beebe ‘page 2 with the civil rights lawsuit. <A good example of this type of lawsuit is found in Arkansas’ Western District Federal Court in Karr v. Townsend 606 F. Supp. 1121 (1985). In that case, District Judge Waters construed a public employee; namely a Deputy Sheriff, to have a protected liberty interest under the 14th Amendment to the U.S. Constitution and subsequent United States Supreme Court cases construing that Amendment. At page 1127, Judge Waters notes that: the law in the Eighth Circuit appears to be that it is not really necessary for a party suing under section 1983 for the violation of a liberty interest [to] show that he has been defamed. .. .LIJ£ the reasons given are defamatory in nature if not true, and if the employee is not given a opportunity to rebut them,. .. he is still entitled to nominal damages and attorneys fees if he is not afforded the opportunity to futilely try to clear his name at a name - clearing hearing. Judge Waters. has again taken this position in a case called Hogue v.. Clinton, in which a state employee was terminated by the Division of Social Services, Department of Human Services. That case is currently on appeal to the Eighth Circuit Court of Appeals for determination of whether a public employee does indeed have a sufficient liberty interest in his..good. name to invoke the protection of the 5th and 14th Amendments. The law in this area concerning * public employees is- uncertain: at present.: So far, the: Federal..District Judges: of. the Eastern. District. of Arkansas’ i.e. in Seal v. Pryor, 504 F. Supp. 599° (1980),° aff'd — on 607F.2d 96 (8th Cir. 1981) have held that a public employee a - dpes not, have,a;property interest in his employment nor a >-Tiberty interest unless the stigmatizing information is . . false. and the. source of such information is the public | “Lemployer. ee ete The: situation you pose. in your request, of course, can “include private employers and employees as well. “ Waters in-Karr,.‘supra,:at 1131 notes that: ae ‘-[U]nless the county personnel policy . . “provides [the . Deputy Sheriff] with a property interest, it is clear ’ that Karr's employment was terminable tat will’ under — Arkansas law [Citations omitted]. Plaintiff's — employment was not under tenure or contract nor was. - there any clearly implied promise of continued employment unless the personnel policies accomplished this. Thus, at least absent the personnel policy, _ Plaintiff had no legitimate claim of entitlement to _ employment. . .unless the county personnel policies - '. legally and effectively granted to the Plaintiff.the Judge “ . ae The Honorable Mike Beebe page 3 contractual right to his employment or a legally enforceable expectancy of continued employment, and granted to him no property interest protected by the due. process clause of the Constitution, Because of this disagreement among district courts, it is currently unclear in Arkansas as to whether a public or private employee has a sufficient liberty interest in his good name to be able ‘later bring suit under §1983 for damage to his reputation. However, a private or public employee may have a property interest in any given circumstance based on the factors set out in Karr; namely, whether their employment is under tenure or.contract or there is any clearly implied promise of continued employment. It. is likely Arkansas will have more lawsuits in the future alleging deprivation of civil rights when derogatory remarks about an employee are made by a former employer to a prospective employer. However, because there seems to be a trend toward bringing these kind of actions under §1983, obviously, no remedy exists in enacting Arkansas legislation as any change to federal laws must be accomplished by Congress. On the other hand, such actions against former employers for negative job. references may be brought in state court as defamation lawsuits. The issue of defaming employees has apparently arisen in several other state court actions-- Saunders v. Van Pelt, 497 A.2d 1121 (Me. 1985); Great = Coastal Express, Inc. v. Ellington, 334 S.E.2d 846 (Va. 1985), Wendler v. DePaul, 499 A.2d 1101 (Pa. 1985); and Kellums v. Freight Sales Centers, Inc. 467 So.2d 816 (Fla. App. 1985). The cited Florida case is most on point. At | page 817, the Florida Appeals Court stated: - Florida’ recognizes-that an employer may claim a = qualified privilege in communicating information about a £Eormer employee: to a prospective employer, but he is. -..the’ employer. is free to communicate his honest opinions - about the employee's job performance and any information which is relevant to the inqliiry being made. .. -however,. the employer cannot | deliberately Lie about the employee! s conduct. The Florida Court goes on to note that an employer cannot absolve himself of liability for an intentional tort-- defamation-~by an exculpatory clause in an employment contract as this is against public policy. obligated. to act reasonably and prudently in doing re Nene and,’ pursuant: to the language in Kellums, supra, it is. The Honorable Mike Beebe page 4 The Florida Court's reasoning is consistent with Prosser §115 at 795, 796 (4th ed. 1971) and other cases-~-Anson v. Erlanger: Minerals and Metals, Inc. 702 P.2d 393 (Ok1. App. 1983) and Anderberg v. Georgia Electrical Membership "€orporation,-332 S.E.2d 326 (Ga. 1985). nArkansasnvecognizes that qualified priviledge is granted to ‘“pubkic-officials" in speaking of current and former ~employeestijob performance in Dillard Department Stores v. wFelton; 2767Ark. 304, 634 S.W.2d 135 (1982); and Galiman v. Carnes: 254. Ark. 487, 497, S.W.2d 47 (1973). In Dillard, -supra;*the .Arkansas Supreme Gourt states that the law of -Atkansas:.is summarized in the Restatement of Torts §595 (1981) (which tracks the quote from Prosser supra) in that Tqualified-privilege exists if the information is of sufficiently important interest to the recipient or third ‘persone “However, the Supreme Court cautions at’ page 308: -~ “ESjuch communications must be exercised in a reasonable sy akanner £or a proper purpose. “ims eeping, ‘then, with other states, Arkansas appears to allow qualified privilege for former employers as long as Othe nenfoiymatien given is accurate and is given’ to parties ntdyatt havejod sufficient interest therein. In alamatiann Tan aBhma thasilis: Een -such privilege is in accordance with language. found :in the most recent U.S. Supreme Court case on _, Geedamat Lion: > aoa ‘TudedeahiiaaWewspaper, Inc. v. Hepps., 54 U.S. L.W. 4373 APHIS "20s" 2986) at page A375 3 . App 21985) 0 “page [alle, betld eve that a private-figure plaintifé must bear ; therburden of showing that the speech at issue is false ——-~ -----5y wbefoire recovering damages - for defamation from a media efendant. 70.2. “ObLEGatEd! . Ne i ; hus.,teven:.under — state ‘court precedents in Arkansas (and elsewheré), a former employer. is generally protected in . giving a negative job reference as long as he exercises some “reasonable care in doing so; hamely, that the information: . givem is accurate and can be documented and proven. -Erom his - point of view.. erties It. would. probably not be of much assistance to attempt to limit, by state law, an.employer's liability in this regard _ .because.of the fact that defamation is an intentional tort .~ “against. the public policy of a state to. attempt to. 9. Limit. J Mability for. intentional” ‘torts. oe a ot The Honorable Mike Beebe page 5 . Since the law in Arkansas already appears to require that a negative job reference must be intentional and false for an action to lie against the employer, legislation precluding liability for negligent statements may not be necessary. This is not to say that someone cannot be sued for such statements. But, until a definitive ruling from the Eighth Circuit is forthcoming on the questions presented, such suit would not likely be successful. I hope this discussion-is of assistance to you. A copy of this request has been sent to Mr. Larry O'Dell of the Stuttgart Daily Leader, ~ The foregoing opinion, which I hereby approve, was prepared by Special Counsel to the Attorney General R.B. Friedlander. Sincerely, STEVE CLARK — Attorney General RBF/mo r J