On January 28, 2014, the United States District Court for the District of New Hampshire issued an opinion allowing a defamation case to proceed against an employer who said an employee was terminated for performing a “heinous act” or a “heinous crime.”  Grivois v. Wentworth Douglas Hospital.

What You Need To Know.  After terminating an employee, a company should provide other employees with minimal information concerning the reason for the termination.  While telling employees that there were performance problems or that the employee was not “a good fit” is probably acceptable, – as long as the statements are true – employers should not provide greater detail or make statements that include personal information or cast the terminated employee in a bad light.

Grivois sued for defamation because a supervisor allegedly told people she was fired for “a heinous act” or “a heinous crime.”  The company first tried to defend by saying that the statements were not factual.  They were just opinion and opinion statements cannot be defamation.  The court, however, ruled that it was not an opinion to say someone committed a crime.  The underlying assertion was a fact, (i.e. that Grivois was terminated for breaking the law or doing something terrible) and not an opinion.  Therefore, Grivois could sue for defamation based on the allegation that these factual statements were made by a supervisor.

The company also argued that it had a conditional privilege and could not be sued for making statements about work matters to employees.  There is some truth to this.  While the law will protect some work related statements, the court needs to be convinced that the person made the statement in good faith, thinking it was true, and without actual malice.  In this case, the court found that the person saying that Grivois was terminated for heinous acts or crimes had no reasonable basis for believing that a crime had occurred.  Because there was no reasonable good faith belief that Grivois committed a crime, the company was not protected from a defamation suit.

If a company needs to discuss truthful but negative information about a terminated employee, the company needs to be very thoughtful and cautious.  It must be able to prove that the people in the discussion had a common business interest and a good faith reason to discuss the terminated employee.  For example, a supervisor has a good faith reason to learn why one of his or her employees was terminated by a higher level manager in order to manage the rest of the workforce.  It is unlikely that a court would find defamation if the supervisor was given the reason for the termination.  Knowing why an employee is terminated can help a manager treat other employees consistently.  But, courts are very skeptical of people who give too much information to too many people.  In order to be protected by the privilege, employers and managers need to limit what is said to the bare essentials, they need to stick to the accurate facts, and they need a good reason to be discussing the matter.  If a court believes that people are just gossiping or spreading negative information with no business reason, it will allow a defamation claim to proceed.

If you are preparing to terminate an employee, make sure all the managers involved are prepared with a statement that can be used if someone asks what happened.  It is acceptable to remind co-workers that termination discussions are private and cannot be revealed.  Remind employees that they would want their privacy protected if they were terminated.  If the termination must be discussed, managers should be counseled to stick to the basic facts, avoid inflammatory language, and limit discussion to those people who have a clear business reason to know why someone was terminated.

If you are considering terminating an employee, EmCo can help you think through the decision, determine if there are alternative or preliminary steps to be taken, and help you through the process to minimize disruption and risk of a lawsuit.  Please feel free to contact EmCo to discuss these matters.