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To the frustration of job seekers and hiring managers alike, an increasing number of employers are instituting a blanket "no reference" policy.

The trend, which began in the United States, has gradually trickled north of the border and typically covers both verbal and written references.

Though it has long been tradition for well-regarded employees to ask for and receive a positive reference to help ease their transition to the next position, some employers are declining to provide anything more than a bare-bones "confirmation of employment," outlining person's job title and length employment.

For job seekers, especially long-serving employees and those let go without cause who expected to receive a positive review of their tenure, it can be one more hurdle to overcome in their job search. For hiring managers, the policy can make it more difficult to determine whether the contenders for a job are really a good fit.

Why the change in policy? Quite simply, a fear of lawsuits.

A few years ago in the United States, an anesthesiologist was dismissed after he was caught using narcotics at work. Upon his departure, the company gave him a positive reference, but later, at his next job, he came to work impaired and almost killed a patient. The patient's family, who sued the new employer, was awarded $8-million (U.S.). That company then turned around and sued the anesthesiologist's former company, which provided the reference, and won.

This example may sound extreme, but it can happen.

The company also leaves itself open to a lawsuit if it provides a negative reference about an employee, especially if that employee was let go without cause. Not only could the poor reference prevent the employee from successfully landing employment, the company could be sued for wrongful dismissal if it were to tell others that the employee was dismissed for other reasons.

In order to avoid such predicaments, companies are simply instituting a "no reference" policy.

While this presents a challenge for job seekers who wish to demonstrate their value to a potential employer, it is by no means impossible to overcome. The solution lies in understanding the gap between a "corporate" reference and a "personal" one.

A corporate reference is just that – a reference on behalf of the company. Whatever is said is understood to be the view of the company as a whole. In other words, the company is accountable for whatever is said about a person.

A personal reference, on the other hand, is a reference by an individual who assumes all accountability for what he or she says. This reference can be from a co-worker or supervisor, so long as they understand that their opinions are personal and do not reflect the views of the company as a whole.

Even if a company has a "no reference" policy, that does not necessarily prevent an employee's former co-workers from providing personal references. There's nothing to stop an employee from seeking a reference from a former manager who has since left the company, either.

Such references, however, must be clearly characterized as personal, and not reflecting the opinion of the company.

The references that most employers look for are verbal. Employees should be sure to get permission from their references before they give their contact information to a potential employer. It may also be advisable to ask the reference for their non-work contact information, just to be clear that the person is providing a personal reference.

As with all references, it is wise for the job seeker to call first to give the person information about the role and provide them with speaking tips based on what the potential employer will want to know.

Employees, especially when terminated from their role, should negotiate for a written reference as part of their separation agreement. It nails down the "departure message" – what the company can say if anyone inquires about the employee. The company and the terminated employee should agree upon the content of this letter.

Employees can also ask for an employment confirmation letter, which simply states the employee's title, and length of employment. But frankly, these letters are of little value to the employee in terms of a reference since they do not reveal anything about the employee's competency or performance.

Eileen Dooley is a certified career coach and general manager of Calgary-based career transition and outplacement firm McRae Inc.

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