Can I Sue My Employer for Defamation?

Not every job has a fairy-tale ending. Sometimes you and your boss simply do not get along. After working at the company for some time, either you get fed up or they do. You quit or you get terminated. Sometimes, you might not even be aware of the bad blood–you simply leave your job in the hopes of better pay or career advancement, unaware that your former boss feels slighted because you quit. You only find out when you lose out on a job because your old supervisor gave you an extremely negative reference, citing performance problems and other issues that are all news to you. If your former (or current) employer bad-mouths you to prospective employers or clients, do you have any recourse? Read on to learn about defamation in the employment context, and if you’ve experienced retaliation, defamation, or other problems in the workplace, call a seasoned California labor law attorney for help.

What is Defamation?

Defamation is a legal claim based on false statements made to the detriment of another person. When those statements are written, the plaintiff has a claim for libel. When those statements are made orally, the plaintiff has a claim for slander. The legal requirements for slander and libel differ slightly, but to successfully bring any sort of defamation case, the plaintiff must generally demonstrate:

• The defendant made a defamatory statement to at least one other person besides the plaintiff
• The statement was a false statement of fact, not an opinion
• Whoever heard the statement reasonably understood that the statement referred to the plaintiff and that that statement was defamatory
• The defendant failed to use at least reasonable care in determining if the statement was true or false before uttering it

To be defamatory (or libelous or slanderous), the statement must portray the victim in a negative light. There are many specific examples, including statements that negatively affect the victim’s occupation, profession, trade, or business. The statements can refer specifically to the victim’s performance or competence in the profession, or to other issues that would negatively affect the victim’s professional reputation (such as accusing them of a crime).

Proving a defamation claim can be challenging. It’s important to distinguish between fact and opinion. A defamation case can be based on false statements of fact, but it cannot be based on the speaker’s opinion. You can sue for defamation if someone falsely claims you embezzled company funds or consumed drugs while on the job. You cannot sue for defamation because someone says “I didn’t like him, I thought he was an ungrateful jerk,” even if that statement harms your reputation.

Employer Defamation

Employers may be held liable for defamatory statements depending upon the context in which the statement was uttered. A false statement by a supervisor made in a reference call or email to a prospective employer or client would be grounds for a defamation claim. Similarly, a false statement made in a performance review that negatively affects the employee’s professional reputation may be grounds for a defamation claim.

In both of these circumstances, the defamatory statement was made “in the course and scope of [the employee’s] employment.” When a defamatory statement is made by a manager, supervisor, or other employee in the course of the defamed worker’s employment, the victim may have a claim against the company. If the supervisor made a defamatory statement on their own time, such as at a bar or while on vacation and away from the employment context, the victim may have a claim against the individual supervisor but not against the employer proper.

Employer Protections and Limitations on Defamation

Defamation claims against employers in the employment context are a bit more tricky than the standard defamation claim. Employers are afforded additional leeway when making allegedly defamatory statements. Employers may not generally be sued for defamation for making statements to their workers, nor may they be held liable for co-workers of the victim making defamatory statements to one another. (If the defamation persists and is based on an immutable characteristic such as race, the employee may, however, have a claim for hostile work environment harassment or discrimination.)

Employers are also afforded a higher level of protection (a “qualified privilege”) for making statements in job references to other employers. If your employer makes an otherwise defamatory job reference to a prospective employer, your employer will only be liable if you can demonstrate the statement was made with “malice.” It’s not enough that the employer was careless with regard to the truth of the statement; the employer must have been acting with deliberate ill will toward the victim.

Notably, a separate section of the California Labor Code does prohibit employers from preventing or attempting to prevent a former employee from obtaining employment by way of misrepresentation. Any employer (person, agent, or office thereof) who makes a misrepresentation in order to prevent a former employer from getting a new job can be charged with a misdemeanor.

If you are a San Francisco employee or employer in need of advice or representation concerning retaliation, whistleblower protections, workplace discrimination, or other California labor law issues, contact the Richard Koss Bay Area employment law attorneys at 650-722-7046 on the San Francisco Peninsula, or 925-757-1700 in the East Bay.