Are all employees entitled to a “good” or “very good” job reference?

When an employment relationship is about to be terminated, employees often demand a “good” or better reference from their employer. Do employers have to comply and always provide such a reference? This question arises in particular if the separation is at the instigation of the employer because the employee has committed breaches of duty or the work performance was unsatisfactory. Lawyer and employment law specialist Nils Wigger from the law firm Wittig Ünalp explains what needs to be considered here and how employers can act in such cases.

Employers and employees regularly come to an agreement before the labor courts regarding the issue of a “good” or better job reference. In many cases, this also applies if significant accusations and breaches of duty in the area of conduct have previously been made or if the employee’s poor performance was the decisive factor in the employer terminating the employment relationship. More interesting and therefore more “contested” in the settlement negotiations before the labor court are regularly the amount of the severance payment and a leave of absence. Only rarely is a reference actually disputed.

Is there a right to an employer’s reference?

A distinction is first made between normal references, which are issued upon termination of the employment relationship, and interim references, which are issued during the current employment relationship.

When an employment relationship is terminated, the employee is generally entitled to a written reference. This must be issued at the time of termination.

For a long time, employees were only entitled to request an interim reference if they had a legitimate interest in doing so. This interest would exist in particular if notice of termination was given or promised, if the employee’s position or duties changed or if a new superior was appointed. According to current case law, however, the employee’s wish to change jobs should already be considered a legitimate interest. For this reason, employees can therefore always request an interim reference.

What content must a reference have?

The reference must at least contain information on the type and duration of the activity (simple reference). However, the employee can also request that the employer provide additional information on performance and behaviour in the employment relationship (qualified reference) (Section 109 (1) GewO).

The reference must first contain information about the employee and the employer as well as the period of employment.

A job description must then be included in the reference. The job description does not have to include all the activities that the employee has completed during their employment with the employer. However, the essential activities of the employee must be stated. This is necessary so that potential new employers can gain an overview of what the employee has done in their previous employment.

As part of the qualified reference, the reference must then contain an assessment of the employee’s performance and behaviour in the employment relationship. As part of the performance appraisal, the employer must describe the way in which the employee has carried out the tasks assigned to them. This is regularly done on the basis of assessment criteria such as abilities, knowledge, skills, dexterity and diligence as well as enthusiasm and attitude to work. When assessing the behaviour of employees, their relationship with co-workers and superiors as well as their integration into the operational workflow must be assessed in particular. In principle, the employer is free to decide which of the employee’s achievements and characteristics he wishes to emphasise or deemphasise.

The formulations and expressions of the reference are at the employer’s discretion. The benchmark here is a benevolent and reasonable employer.

May breaches of duty be included in the job reference?

Behaviour and performance must be presented in full in a standardised reference and the entire duration of the contract must be taken into account. Against this background, individual incidents – whether positive or negative – are of secondary importance and may not be emphasised if they have not influenced the overall performance and overall management. If there have been individual breaches of duty in this respect, in a longer-lasting and otherwise trouble-free employment relationship, the breaches of duty may not be included.

Lies in the job reference

The reference is regularly used as an application document and is therefore intended to provide third parties, in particular potential future employers, with a basis for personnel selection. At the same time, it provides the employee with information on how their behaviour and performance are assessed.

This gives rise to the requirements of truthfulness and clarity of the reference. The content of the reference must therefore be expressed correctly and clearly. However, how individual performance and behaviour are assessed is a matter of great debate. The assessment is very complex and depends on many factors. This applies all the more to employment relationships that have existed for a long period of time. It is therefore generally difficult to verify whether the content of a reference is true.

In principle, however, a claim for damages would be conceivable if the employer deliberately provides a false job description or performance and behaviour assessment and a subsequent employer – in reliance on the reference – hires an employee who is not suitable for the intended job. However, it is likely to be extremely difficult to establish a corresponding chain of causality, meaning that a claim for damages can only be considered in theory.

Can the employee sue for a job reference?

If the reference does not fulfil the formal requirements, the employee can request that it be corrected or supplemented. By bringing an action before the labour court to correct or supplement an employer’s reference, the employee is still legally asserting the fulfilment of his or her entitlement to a reference and not a claim for correction or supplementation – which is foreign to the law.

No fundamental entitlement to a ‘good’ or ‘very good’ job reference letter

However, it is questionable whether the employee can also sue for a more positive assessment of performance and/or behaviour. In principle, an employee is not entitled to a ‘good’ or ‘very good’ reference, but only to a performance-related reference. In this respect, it depends on how satisfied the employer was with the employee’s performance and behaviour. However, it should be noted that ‘satisfaction’ is not based on subjective criteria, but on an assessment that is orientated towards the objective requirements that are usually placed on an employee with comparable tasks. The assessment must therefore consider how the employee performs in relation to comparable employees.

The burden of proof is then decisive in the context of a possible claim before the labour court: if the employer issues a reference that certifies that the employee’s performance is at least average or ‘satisfactory’, the employee bears the burden of presentation and proof for the facts that should justify an above-average assessment. The employee must therefore prove that his or her performance was better than the employer has stated in the reference.

If, on the other hand, the employer only gives an ‘adequate’ or even worse assessment in the reference, the employer must present and prove in any legal proceedings that the employee did not actually deserve a better performance and behavioural assessment.

Is there a right to a closing formula?

An employer’s reference usually ends with a ‘thank you, regrets and good wishes’ formula. In this formula, the employer expresses their thanks for the work performed, regrets the employee’s departure and wishes them all the best for their professional and private future.

As these are personal sentiments on the part of the employer, the Federal Labour Court has ruled that the employee is not entitled to this. If the reference does not contain a corresponding formula, the employee cannot sue for this.

Since an employer’s reference without such a closing formula is practically worthless, as any knowledgeable reader of the reference will immediately notice the absence and can – as a rule – draw the justified conclusion that there were problems in the employment relationship, the employer regularly has the ‘upper hand’ when issuing the reference.

However, there is one exception: an employee is exceptionally entitled to the issue of a corresponding closing formula if the employer has previously issued a reference with such a formula. If the employee subsequently makes changes to the reference, the employer may not change or omit the previously issued closing formula in the amended reference. This would be a violation of the prohibition of measures under Section 612 a BGB.

Conclusion

In principle, employees are not entitled to a ‘good’ or better evaluation in the reference if the behaviour and performance do not correspond to this. Employees would have to prove this in court, which is likely to be very difficult in practice. Nevertheless, the parties to the employment contract often agree on a corresponding evaluation in the reference, as employers generally have no interest in investing time and money in a reference dispute.