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When an employee approaches you to ask for a reference letter, particularly for a new job or role, it can sometimes be difficult to know what to do next. In general, while it may be upsetting to lose an employee, you should do your best to provide a good reference for your outgoing employees. The employee will appreciate your support and that you are doing the right thing by them and their time with your business. Likewise, you help to build good relationships in your industry. This article sets out three tips when providing reference letters to your employees, including:

  • the value of giving high-quality references; 
  • what to include in your letters; and 
  • how to say ‘no’ if you feel you cannot give a good reference. 

Giving Quality References to Maintain Good Relationships

Giving a high-quality reference is a good gesture to do as a manager and as someone who runs a business. While you may be unhappy to lose a valued employee, you will not achieve anything by giving them a mediocre reference or recommendation if they are looking to work elsewhere. Either way, the employee is likely to leave your business. Giving a good reference if any employee has worked hard is the right thing to do. Likewise, it is in line with your duty of good faith as an employer.

Another significant advantage of giving quality references is to maintain strong relationships with your employees. Many employees eventually return to a business they enjoyed working in, even if they left that business to take an opportunity somewhere else. Giving a good reference helps to reinforce your good relationships with employees. In addition, in most industries in New Zealand, your reputation is pivotal, and word travels quickly. Therefore, you want to have a reputation as a good employer to attract good staff and maintain a positive business culture. 

Include Specific Information and Give Contact Information

You may find it hard to determine what to include in your reference letter to your employee. Remember, you have the flexibility to write what you feel and what you want the employee’s prospective employer to know. Common details to include are:

  • the employee’s role, history and work with your business;
  • what their skills and experience include;
  • what the employee’s highlights or strengths are;
  • that you recommend them; and
  • any other information you want to note about the employee.

It is typically good practice to end reference letters with your contact details. This is so the prospective employer can get in touch with you if they have any questions about your letter or want to follow up with you. 

Saying ‘No’ When Asked to Give a Reference

Sometimes you have a good reason to deny giving an employee a reference. For example, if they have recently started at the business, you may not know them well enough. If you do not know them sufficiently to give a good reference, you should be honest and see if anyone else in the business has known them for a longer time. 

Alternatively, suppose you could not give a positive reference because you do not think that the employee has performed well or to expectations. In that case, you should again be honest about this and help them work out who would be a better referee.

Be respectful and polite when turning down a request to give a reference. Do not criticise the employee, and instead try to work with them to find an alternative. 

Key Takeaways

Providing reference letters to employees can be tricky, especially when you do not know the employee well or feel like you can provide a positive reference. In these situations, you should be honest with the employee and see what else your business can do for them. Otherwise, high-quality reference letters are a good thing to provide as a business manager and will reinforce good relationships. Give specific information in the letter and offer your contact details as a method of reaching out to you.

If you would like more information about providing reference letters, contact LegalVision’s employment lawyers on 0800 005 570 or complete the form on this page.

Frequently Asked Questions

Do employers legally need to give a good reference for an employee?

No, employers have flexibility in terms of giving references. For example, you do not have to give a positive reference by law, although there are good reasons why giving a positive reason is a good idea.

What should I include in a reference letter?

You typically want to set out your relationship with the employee, their experience, time and role in your business. Additionally, you can include accurate information about their responsibilities and performance, your recommendation of them generally. It is also a good idea to include your contact details. 

Why would I turn down a request to give a reference?

There are a few reasons where you may not want to give an employee a reference. This may well be because you do not know them well enough, such as if they only recently started working with you or your business. Alternatively, if you could not give a positive reference, you should be honest about this and help them work out who would be a better referee.

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