No. Erich Segal, I beg to differ. As anyone who has a life knows, love means having to say you're sorry a lot. And that goes for employers, too. The company apology is a fine thing, as long as it is sincere, not a "non-apology apology," and accompanied by what they call a "firm purpose of amendment."

If you don't apologize when you should, then you won't have an incriminating statement that can be used against you in a lawsuit.

But if you do apologize when you should, you may never get that lawsuit at all.

Don't take my word for this. A recent decision by the U.S. Court of Appeals for the Eighth Circuit* will be far more persuasive than I could ever be.

*The Eighth Circuit hears appeals from federal district courts in the states of Arkansas, Iowa, Minnesota, Missouri, Nebraska, North Dakota, and South Dakota.

A retail chain expected its sales clerks to input customers' telephone numbers when processing refunds. Human nature being what it is, the clerks quickly learned that it was a lot easier to simply enter "555-5555" instead of the individuals' actual phone numbers, and so that's what they did.

A sales clerk who obviously had way too much time on his hands (we'll call him D. Duke) entered a racist epithet in the system that was one of the names associated with the default phone number. Mr. Duke, being a bad egg, was subsequently fired for other reasons, but his "calling card" lived on, undiscovered, in the bowels of the system.

One fine day our plaintiff (we'll call her Wealthie, because she's probably gonna be very soon) was waiting on an African-American customer who was making a return. Wealthie decided that the default number would be the quickest way to get the gentleman his refund promptly, so she entered "555-5555" in the register, selected the racist name without looking at it, printed out and signed the receipt without reading it, handed it to the gentleman, and no doubt smiled and wished him a nice rest of the day.

The gentleman read his receipt. BAM! Thinking that Wealthie was the perpetrator, he and his family raised Cain with the store. BAM! BAM! Poor Wealthie had no idea how that bad word got onto the gentleman's receipt, but since she was the clerk who waited on him, she was blamed and promptly dismissed from employment. BAM!BAM!BAM!BAM!BAM!

QUICKIE QUIZ

Q. Thus far, has the employer done anything illegal?

A. Probably not. The employer had a reasonable basis for believing that Wealthie had done something to cause that racist epithet to be printed on the gentleman's receipt. The employer doesn't have to prove that Wealthie is "guilty beyond a reasonable doubt" as long as it had an honest, good-faith belief that she had committed misconduct warranting termination.

OK, back to our story . . .

The story of the racist receipt went, if you'll pardon the cliché, viral on Facebook and everywhere else. The employer, faced with some major public relations problems, decided to issue a press release. The press release apologized profusely (good), said that the company was "sickened and saddened" about the incident (good), and said that the employee responsible was fired. Wealthie was not identified by name.

Well, I tell you what - those folks on Facebook are good for a lot more than taking courageous stands in favor of the painfully obvious, Yelping the patty melt they ate for lunch, and Bejeweled Blitzing. They actually figured out that Wealthie was the clerk who had waited on the gentleman, and then began posting on Facebook and all over the internet the name of the "racist." Wealthie became so afraid for her safety that she left her child to live with her dad and went into hiding.

Meanwhile, within two days of Wealthie's termination, the company's IT folks figured out that the racist code had been put into the system by D. Duke and that poor Wealthie had been a mere victim of circumstance. At worst, she was guilty of having used the "lazy" default phone number instead of her customer's actual number. And maybe she should have been paying more attention to what she was doing, but who'd a thunk???

QUICKIE QUIZ

Now that the company knows the truth, guess the outcome!

After realizing that Wealthie was innocent, the company

a. Promptly issued another press release saying that the clerk who had waited on the gentleman turned out to be completely innocent and was not responsible for the epithet on the receipt, and that the real perpetrator had been fired long before but had apparently left this in the system as a "parting gift"; and personally apologized to Wealthie and offered to bring her back to work with back pay and no break in seniority; or

b. Issued a vague, wishy-washy follow-up press release that did not perzackly correct the record or clear Wealthie's name.

Now, the company does have some defenses and will have the chance to prove them at trial. First, the original press release did not identify Wealthie by name. But the Eighth Circuit said it arguably did enough to identify her because everyone on the internet figured out who she was, and in pretty short order. Second, the original press release did not technically say that Wealthie was the perpetrator, or even a racist. But the Eighth Circuit said that both were arguably implicit in the press release, which was good enough to create a jury issue. The company also noted that truth is a defense to a defamation claim, and that everything in the press release was truthful. But the court said that IF Wealthie was easily identifiable and IF she was impliedly accused of being responsible for the racist receipt, then the press release was not "truthful." Since Wealthie was not, in fact, guilty.

Well, ok, the company said, but we issued that correction after we realized that she didn't do it. That doesn't necessarily help, the Court said, because the second release did not clearly indicate that the guilty employee was not Wealthie. In fact, the second release could be read as saying that Wealthie, rather than Mr. Duke, was the one who had made the entry in the system.

(The company raised some other defenses, which you can read about in the court's decision.)

Yuck. Understanding that the employer was flipping out over a public relations disaster and had to act promptly and decisively to avoid alienating most of its customers, what should it have done differently?

*The employer should not have rushed to judgment. Bad as this was, the employer should not have fired Wealthie right off the bat. Presumably, Wealthie insisted from the beginning that she had not been responsible for the epithet on the receipt. With Wealthie maintaining her innocence, the employer should have suspended her while it investigated how this all happened. Meanwhile, the employer could have immediately issued a press release apologizing profusely, saying it was "sickened and saddened," and assuring the public that it was conducting a thorough investigation of the incident. Within two days it would have known that she hadn't done it and could have issued a second press release telling the real story without impliedly libelling Wealthie.

*Even if the employer did rush to judgment in the beginning, it should have made amends with Wealthie once it knew it was wrong. Here's where my "Love means having to say you're sorry" comes in. OK, let's say the employer was freaking out and acted precipitously. Once it had all the facts, it should have done whatever it could to make Wealthie "whole." This means issuing a press release that explains that Wealthie was cleared in the investigation. It also means offering her job to her, and with back pay. And without asking for a release in exchange. (Remember -- there were only two days between Wealthie's termination and the company's discovery that Mr. Duke had done it, so we wouldn't be talking about a lot of money.) Even if the company did not apologize to Wealthie in the press release, someone from the company should have made a personal apology to her. Then, if they needed to crack down on employees' entering "555-5555" instead of customers' actual phone numbers and being more attentive to their duties, they could have dealt with that separately since other employees were doing it as well.

Of course, I'm just a blogger and not a real reporter, but maybe that second press release could've gone something like this:

. . . Upon further investigation, we determined that a different employee, who was terminated long ago, had rigged our system so that the epithet automatically printed out on receipts when a certain "default" phone number was entered. We were able to identify this former employee based on his unique password and the date and time that the entry was made.

The clerk who had waited on the customer day before yesterday was NOT this employee. She is NOT the employee who entered the epithet in the system, and she did NOT know that the system was rigged to generate the epithet. While processing this customer's return, she had merely entered the "default" phone number and unknowingly generated a receipt with the offensive epithet. She did not realize that the epithet was on the receipt when she gave the receipt to the customer.

We have reprogrammed the system so that the epithet is purged, and we are taking other corrective actions to ensure that this type of incident will not happen again. We sincerely apologize to our customers and the public and very much appreciate your continued business.  

(To all the dads out there, I wish you a happy Father's Day!)

Photo credits: Wikimedia Commons (public domain).

(CAUTION - last I heard, the anti-SOPA blackout is still scheduled to occur on Wednesday even though the bill has been severely stalled in the House of Representatives, so if the links don't work on Wednesday, we hope you will try again on Thursday when everyone is back up.)

OK, on with the festivities! Thanks to Wikipedia for the information about the Chinese New Year and the quotes.

Preliminaries

Before New Year's Day, Chinese families thoroughly clean their houses -- not only to be ready for celebrations, but also to sweep away the bad luck from the prior year and make the house ready for good luck in the new year. "Brooms and dust pans are put away on the first day so that the newly arrived good luck cannot be swept away."

Mark Toth of The Manpower Group Employment Blawg recommends some "housecleaning" with employer performance evaluations, in "Evaluation Evaluation" and "Performance Evaluation Worst Practices."

Day One: Respect Your Elders

The Chinese have a number of traditions on New Year's Day, but the most universal is to honor one's elders. Chinese families "visit the oldest and most senior members of their extended families" on this day.

Philip Miles of Lawffice Space has a good post about an older applicant who was rejected for being "overqualified" -- is "Too Smart to Hire?" just code for age discrimination?

Also, if you represent family businesses, you will love Adam Whitney's "You May Be Damned if You Work With Family Members."

Day Two: Show Me the Money!

On the second day of the Chinese new year season, families celebrate the birthday of the God of Wealth. "Business people of the Cantonese dialect group will hold a 'Hoi Nin' prayer to start their business" on this day "so they will be blessed with good luck and prosperity."

Prayer at work? Jessica Miller Merrill of Blogging4jobs has sparked lively comments and is sure to generate debate with her "God Has No Place in the Workplace." (For another view, please see my "Religion in the Workplace: 5 Devilish Employer Mistakes," and scroll to "Religion is a topic of which we must never speak, ever ever ever ever.")

Day Three: Do Not Leave the House Today*.

*Pee-Wee Herman's fortune on the day his bike was stolen.

The third day of the season is the day of "the God of Blazing Wrath." Chinese families are advised to stay home and not visit relatives on this day.

While you're holed up indoors, be sure to visit Ari Rosenstein's CPEhr's Small Biz HR Blog, which has a free downloadable "2012 Human Resources Updates: What Employers Need to Know." Cuddle up next to a blazing fire and read his guide while you stay out of the way of the Blazing Wrath.

Day Four: Greedy Heathens Go Back to Work. (kidding!)

Those who celebrate new year's for only a couple of days return to work on this day. Everyone else continues the festivities.

Speaking of attendance at work, Jon Hyman of the Ohio Employer's Law Blog has a great post entitled "Resolve This Year to Properly Handle No-Fault Attendance Policies." This is a big issue, especially considering the EEOC's $20MM settlement with Verizon, in which the agency claimed that the company's no-fault attendance policy violated the Americans with Disabilities Act.

Day Five: Firecrackers and Dumplings!

The fifth day, Po Wu, is the day for pot stickers (jiao zi) and shooting off firecrackers to get the good attention and intercession of Guan Yu. Guan Yu was a general in the Han Dynasty and is now worshipped as a Chinese god of war, representing "loyalty, truth, strength, and justice."

John Holmquist of Michigan Employment Law Connection has an interesting post about an employer who tried to go on the offensive by filing a declaratory judgment action before an ex-employee could file suit alleging disability discrimination based on his HIV status.

Day Six: Back to the Grindstone, if You're Taiwanese.

The Taiwanese have to go back to work today.

No doubt they'll be tweeting, Facebooking, and linking in. Eric Meyer of The Employer Handbook has a most-interesting post on "Are employees' LinkedIn contacts considered your trade secrets?"

And check out Dawn Lomer of i-Sight Blog, who advises us on "Avoiding the Dangers of Social Media Background Checks."

Day Seven: We're Not Getting Any Younger.

This is renri, the birthday of the common man. According to Chinese tradition, everyone is a year older as of this day.

Since we're all getting older, you may enjoy two blasts from the past on the subject of age discrimination: Donna Ballman's "Nine Signs of Age Discrimination" and my "Nine Signs That You'll Lose Your Age Discrimination Case."

Day Eight: Everybody Back to Work! (And a Nice Custom)

Everyone should be back at work by now, but Chinese employers offer a lunch or dinner for their employees, thanking them for the good work they've done in the past year.

And while we're on the subject of good employers, be sure to check out "How NOT to Go Out of Business" on Tim Eavenson's Current Employment blog and Andrea Paris's excellent Q&A on paying commissions in compliance with California law.

Days Nine and Ten: Thanks to the Jade Emperor of Heaven

On these days, the Chinese offer prayer and thanks to the Jade Emperor of Heaven in the Taoist pantheon.

While giving thanks, you'll also be thankful for Joni Kletter's excellent summary of recent cases interpreting the Americans with Disabilities Act Amendments Act.

Also, see Robert Fitzpatrick's "Observations Regarding the Latest Supreme Court Decisions," which includes his take on the recent Hosanna-Tabor decision, as well as five other noteworthy cases relevant to employment law.

And George Lenard of George's Employment Blawg takes a deep dive into Hosanna-Tabor.

Days Eleven and Twelve: Holiday Peters Out.

More celebratory dinners on days 11 and 12. Not much else, according to Wikipedia.

Since it's a quiet couple of days, this is a good opportunity to catch up on some excellent posts. Donna Ballman of Screw You Guys, I'm Going Home has a must-read on one-sided confidentiality agreements, and Dan Schwartz of the Connecticut Employment Law Blog has another must-read on employment rights of smokers.

Day Thirteen: "Ugh, I don't feel so good . . ."

On Day Thirteen the Chinese are all partied out. They purge their systems by eating a pure vegetarian diet on this day, which is also devoted to Guan Yu.

While we're sobering up and fasting, it's a good time to read Sharlyn Lauby's "Losing Your Driver's License Can Impact Your Career," in which she interviews Heather Bussing of HR Examiner.

You may also enjoy some a cold glass of milk and some "Employment Law Leftovers" if you can't face what's up for the new year just yet.

Day Fourteen: ????

Wikipedia makes no reference to this day. I guess nothing happens?

Since nothing's going on, this would be a good time to read my excruciating "2011 labor and employment law year in review." Guaranteed to have you begging for mercy!

Day Fifteen: Grand Finale.

The fifteenth and last day of the Chinese New Year is the Yuan Xiao Festival (aka the "Lantern Festival"). The candles and lanterns are lit to guide the good spirits to one's home. In Malaysia and Singapore, traditions similar to Valentine's Day are celebrated.

While we're on the subject of romance and unrequited love, be sure to read Gary Gwilliam's "Reasons to Pursue Emotional Distress Damages in Employment Cases."

Our "host with the most" in February will be John Holmquist. Please join us then, and happy Chinese New Year!

Plaintiffs sure do crack me up sometimes.

I have no doubt that this guy's prospective victims employers were very grateful to the union, as well as to the three employer "guinea pigs" for providing honest information about his lousy work ethic and attitude.

But, you may be thinking, we can't provide information about an ex-employee. All we can do is provide dates of employment and positions held (aka Name, rank, and serial number)! Otherwise, we'll get sued!

Generally, I agree. Employers who provide negative reference information about former employees can be vulnerable to claims for defamation and retaliation (yes, the law says you can be liable for retaliation against a former employee as well as a current one), and under state anti-blacklisting statutes.

However, there are occasions when it is prudent to provide more than "Name, rank, and serial number" to (1) avoid incurring liability when a bad employee does something really, really bad at his next workplace, and (2) maintain good relations with your fellow employers by providing judicious warnings about the bad apples.

There are also occasions when you might want to provide positive information about an ex-employee.

Wow -- who knew reference information was so complex?

The complexity will make sense when you consider that not all involuntary terminations are equal. I think it helps to divide them into four categories:

1. Good employee, lousy luck. This group is predominantly made up of good, hardworking, rule-abiding employees who get caught up in a reduction in force. As a responsible employer, you are going to want to do everything you can to help these folks find other jobs. It would not be wrong for you to provide this category with a letter stating that they were terminated through no fault of their own, that they're eligible to come back if the situation at the company improves, and that they're very good at XYZ.

One caveat here: Sometimes employers use RIFs as an opportunity to eliminate lackluster employees with whom management "failed to deal." In other words, their managers had not addressed their problems, much less documented anything. Assuming you provide letters of reference for the good people who were let go, I'd consider providing them also for employees in this "lackluster" category, but saying only that they were let go as part of a RIF and, perhaps, adding a positive but truthful statement about them -- e.g., "Mary always came to work on time every day when she bothered to show up and was well thought of by her co-workers even though her bosses couldn't stand her."

Another caveat: I wouldn't even do that much for employees who were clearly bad. For example, your RIF criteria might have included everyone on an active written discipline. Unless they fall into my last category (see "Axis of Evil," below), this group should usually get the "Name, rank, and serial number" treatment and no letter of reference.

2. Good guy*, couldn't cut it. This category includes the employee who means well and tries hard, but who just cannot meet the employer's performance expectations and so is eventually fired, hopefully after some sort of performance improvement plan. "Name, rank, and serial number" is fine for this type of employee, but it would also not be wrong to provide a truthful and positive letter of reference -- for example, "Joe was our Chief Financial Officer from [DATE] to [DATE], and when it came to making sure we paid all our bills on time, no one was better."

*As we lawyers so pithily put it, "The masculine shall be deemed to include the feminine, and vice versa."

3. The run-of-the-mill-rotten employee. This category includes the majority of employees who are terminated for cause: lazy employees, employees with unjustified attendance problems, employees who violate work or safety rules, employees who have bad attitudes, employees who commit lower-grade dishonest offenses (for example, falsifying time sheets), employees terminated for "less-serious" harassment (for example, one too many off-color jokes), etc. Of course, you don't owe these folks any letter of reference: they should get the "Name, rank, and serial number" treatment. If you choose to add that they are "ineligible for rehire," that should be fine as long as you have progressive warnings or other appropriate documentation so that you'll be able to prove that they're not being discriminated or retaliated against.

4. "The Axis of Evil." It is hoped that you will not encounter many people in this category, but this would include employees who were terminated for extremely serious reasons: theft, embezzlement, severe harassment (including harassment based not only on sex or race, etc., but also "stalking" or threatening or bullying), violence, crime, and serious safety violations, especially if they endanger co-workers or the public.  For this category of employee, you probably have a moral if not legal obligation to provide some level of warning to would-be employers. Of course, you will have to be very careful about what you say to avoid liability for defamation. But truth is a defense to a defamation claim, so the key is to make sure that what you say is absolutely factual, and that you can prove it.

For example, let's say Mary accuses her supervisor, Joe, of serious sexual harassment -- a sexual assault. You conduct a thorough investigation (that's another blog topic for another day) and cannot determine for sure that it happened. But there is strong evidence to support Mary's allegations, and so you terminate Joe.

When Joe's prospective employer calls you for a reference, why not follow the path of least resistance and limit yourself to "Name, rank, and serial number"? Because of the gravity of the allegations. Joe might go to his next employer and rape an employee there. When it comes to light that Mary had made credible allegations of sexual assault while Joe worked for you but you didn't disclose it when asked for a reference, you could be liable to Joe's next victim and even, possibly, Joe's next employer.

So, what do you say?

NOT THIS: "Joe was terminated from Acme Company for sexually assaulting his employee in the broom closet."

Since you don't have conclusive proof that Joe did it, you won't be able to establish the "truth" defense if Joe sues you for defamation.

DO SAY THIS: "Joe was terminated from Acme Company after an investigation into allegations that he had sexually assaulted his employee."

You aren't saying anything you can't prove in a court of law, so you should be able to take advantage of the "truth" defense. And the next employer is still getting all the information it needs to be able to reject Joe for hire.

Well, you are saying, this discussion has been delightful, but it seems like an awful lot of fine-line-drawing. Does this mean we have to talk to a lawyer every time we provide an employment reference?

For categories 1-3, you should usually not need to consult with a lawyer. For the "Axis of Evil," you should always consult with a lawyer, and it will be time well spent. Here is a quick list of the handful of situations in which I would recommend getting legal counsel involved:

1. Whenever an ex-employee has engaged in some type of legally protected activity (internal complaint of discrimination or harassment, truthful testimony, or charge or lawsuit) and you are not planning to treat her exactly the same way that you treat everyone else.

2. If your failure to give an ex-employee a letter of reference might look discriminatory to an outsider. (For example, you are giving letters of reference to all of your Anglo and African-American employees whose jobs are being eliminated, but you are not giving one to your only Hispanic employee, who happened to have attendance problems. This might be fine because of the attendance problems, but it would not hurt to have an attorney make sure you can justify the differential treatment.)

3. Any time you are considering providing an affirmatively negative reference about an ex-employee.

4. Any time an employee is being fired for an "Axis of Evil" offense but you believe you should not provide truthful reference information.

(Again, don't forget to check your state's laws about blacklisting and references before you provide any information about a former employee.)