Bill Exposes Employers to References Liability

Lawmakers are considering legislation that includes troubling language increasing an employer’s potential liability for employee references.

The legislature’s Judiciary Committee will hold a public hearing March 22 for SB 3, which largely deals with online and data privacy for consumer health data and minors’ personal data.

Section 13 of the bill requires companies to disclose any “known act of sexual harassment” or “sexual assault” committed by an employee in the workplace if a recommendation or positive commentary about that employee is provided to a potential employer.

If the employer fails to make this disclosure according to the below requirements and the employee is hired by a new employer and commits an act of sexual harassment or sexual assault, the former employer who failed to disclose the act is liable to any employee of the person who relied on the recommendation or positive commentary.

Duty to Disclose

“Sexual assault” is defined by criminal statutes and “sexual harassment” is defined by the Connecticut Fair Employment Practices Act.

The bill states that an employer “knows” about the sexual harassment or sexual assault when a formal complaint is filed with the Commission on Human Rights and Opportunities or the Equal Employment Oppurtunity Commission, or a court of competent jurisdiction. 

The employer’s duty to disclose terminates one year following the date on which the employer has actual knowledge of the employee’s act.

The employer’s duty to disclose the sexual harassment or sexual assault terminates one year following the date on which the employer has actual knowledge of the employee’s act.

The duty to disclose is triggered when the employee issuing the reference has “actual knowledge” about the sexual harassment or sexual assault when a formal complaint is filed with the Commission on Human Rights and Opportunities or the Equal Employment Opportunity Commission, or a court of competent jurisdiction. 

‘Problematic Language’

Section 13’s language is problematic on a number of fronts. 

First, the bill provides that the employer only has the duty to disclose for one year or less if certain things happen, like the assault is nolled, or the harassment complaint is dismissed.

But this presupposes that the employer knows that a complaint was dismissed or a case was nolled.

If the employer isn’t involved in the court proceedings, as many employers are not, it will not know of this action.

Even if CHRO later makes a finding of no harassment, the employer still has a duty to disclose it.

Furthermore, the termination of this duty to disclose sooner than one year is triggered if, for example, CHRO makes a finding of no harassment (i.e. a finding of “no reasonable cause”).

According to attorneys dealing with these matters, these CHRO findings are never made in the span of one year.

This means that while the complaint is pending at the CHRO, even if the agency later makes a finding of no harassment, the employer still has a duty to disclose it.

This exposes employers to defamation and slander lawsuits by the purported harasser.

‘Liable in Perpetuity’

Second, the bill is not inclusive of all possibilities for a case to be dismissed which would relieve the employer’s duty to disclose.

For sexual harassment, it only mentions a CHRO withdrawal (i.e. settlement) or a finding of no reasonable cause.

However, there are other ways for a complaint to disappear, such as a CHRO dismissal, an EEOC dismissal, and a court action.

Third, the former employer’s liability for nondisclosure of the sexual harassment or sexual assault lasts “for such time that the former employee is employed” at the new employer despite the duty to disclose only lasting for one year or less.

In other words, the former employer would be liable to the new employer in perpetuity for any of these acts at the new place of employment.

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For more information, contact CBIA’s Wyatt Bosworth (860.244.1155) | @WyattBosworthCT.