The potential fallout of disagreeable employee departures

When an employee leaves on bad terms it is crucial HR ensures workers aren’t dishing the dirt – or it could end up in court, says one labour lawyer.

When an employee leaves your organization on bad terms HR must make sure other workers aren’t dishing the dirt to clients and customers – or you could be hit with a defamation claim, says one labour lawyer.

The issue was recently raised in the BC Supreme Court, where an ex-employee was awarded $30,000 after former colleagues made false statements to clients and other third parties.

The employer’s sole shareholder and a former co-worker told business associates that the departed employee had been fired after stealing from the company and engaging in “unscrupulous business practices.”

In reality, the affronted employee had voluntarily resigned as a result of an unresolvable disagreement with the sole shareholder.

Employment lawyer Ryan Berger offered up some best practice tips for HR to share with employees:

“Be selective”

Does every employee and client really need to know the exact reason why someone left? – Probably not.

Protect employee privacy and only enlighten everyone on a strictly ‘need-to-know’ basis, says Bull Houser lawyer Berger.


“Other employees and interested third parties, including clients, need only reasonably be told that the employee is no longer with the organization and who they can direct their work or any questions to,” he continued.

“Be truthful”

Really, this should go without saying but clearly that isn’t always the case. Remind your employees that if they absolutely have to share any information about an ex-employee’s departure, they should, under no circumstance, embellish the story even a little.

“Be cautious” 

“The majority of cases involving defamation by an employer involve an employer who has alleged but not demonstrated cause for termination,” reveals Berger – so drum it into your employees that they shouldn’t even insinuate someone was terminated if, officially, they weren’t.

“Be open”

“Be open to a mutually acceptable message with the ex-employee,” suggests Berger.

“Even in contentious situations, an agreement can often be reached about the employee taking early retirement, pursuing other opportunities, or simply that the employee is no longer with the company,” he added. “Stick with this agreed upon messaging and receive consent from the ex-employee before providing any references.”

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