In these recessionary times there are likely to be any number of people whose jobs are on the line, either through the need for redundancies or because the business has not developed strongly enough.
They may look for work elsewhere and then ask you for a reference. Past experience has shown that this is something of a nightmare for those in the licensed trade.
But let's be clear: there is no legal obligation to give a reference at all, as long as you spell this out right from the start for all employees. You can just stay dumb — as long as you do it for all employees as a matter of policy.
However, the Government and other organisations consider that this is unreasonable and that you should at least respond to requests for a reference in some way. That can be as little as giving just the dates of employment, any holiday or sick leave taken and other factual information.
But what happens if you are asked about disciplinary procedures? You are caught between the devil and the deep blue sea, because you are equally vulnerable if you fail to reveal an essential item of information that could affect the subsequent employment. The new employer might complain that by responding without giving the full facts you caused him a loss by employing someone untrustworthy he would not otherwise have hired.
But the problem can sometimes be the new employer. It is often the case that a standard form is sent out asking specific questions, to which the former employer can reply. What new employer chooses to do with that confidential information is out of the control of the person giving the reference.
The object of a reference is, of course, to assist the new employer in deciding whether or not to offer a job, or to continue with the offer already made. This can sometimes be critical and it is not surprising that rejected applicants become very angry if they are told what was in an adverse reference.
It is appropriate that all references should be marked "strictly confidential". This means that they should not be shown to the employee or any third party unless your consent has been obtained. Most employers will abide by this, knowing that if the employee takes up the post, they will be able to access that information from the new employer anyway.
You must, therefore, confine yourself to stating the facts of the employment and what happened in it, and if you do venture into an opinion on the merits of the employee, make it clear that this is a personal view. Stick to what you know, and do not venture too far. If you are asked about their suitability for a new job, do not answer unless you have clear details of what that job involves.
It is true that some references have landed the writers in court for defamation. Former employees have also been aggrieved about certain facts being included concerning their behaviour: they seem to think you should conceal anything bad and say only positive things. But as I have said, that too can be a problem. You must tell the truth, and that is not defamatory, as long as it is put in context.
The general principle, however, is not to write anything you would not want the employee to see, bearing in mind that they may well gain access to it in due course. Keep any strong or emotive language out of the document and concentrate on the work and abilities of the person concerned. This is a slippery slope and you do not want to end up in front of a tribunal or even in court.