Employer Win: Our Team Defeats $500,000 Claim Over a Bad Job Reference

Samfiru Tumarkin LLP successfully defended Stokes Economic Consulting Inc. and its president, Ernest Stokes, against a $500,000 defamation claim over a negative job reference. The court found that the reference was substantially true. Our team later defended that result on appeal.

The dispute began when a former employee lost a job opportunity after a reference check. He sued for nearly $800,000 across several claims. Our employment lawyers, Gurlal Kler and Jon Pinkus, represented the company and its president at trial and on appeal.

The win attracted coverage from The Canadian Press and National Post, along with radio interviews on 610 CKTB and 640 Toronto. Links and interviews appear below.

A Reference Check Became a Major Lawsuit

Papp argued that the reference damaged his reputation and cost him the job. He challenged the employer’s account and argued that Stokes had acted maliciously or without properly checking the facts.

Our clients’ position was straightforward: Stokes had answered the reference questions honestly. He recognized Papp’s computing skills, but could not give the same positive assessment of his working relationships.

How Our Team Defended the Employer

The evidence backed up the reference. The judge accepted testimony from colleagues that Papp was technically capable but difficult to work with in a team.

Stokes had also checked concerns with two colleagues rather than simply accepting his son’s account. The court found that he genuinely believed what he said, had not been reckless about the truth and had not acted maliciously.

The court accepted two reasons to reject the defamation claim: the comments were substantially true, and the reference-check setting gave protection to the communication that had not been lost through malice. In plain language, a damaging reference does not automatically mean the employer must pay damages.

The Defamation Win Held Up on Appeal

Papp appealed. In March 2018, the Ontario Divisional Court upheld the dismissal of the defamation and related claims. It found no basis to overturn the trial judge’s findings about the reference.

Read the court decisions: Papp v. Stokes, 2017 ONSC 2357 and the appeal, 2018 ONSC 1598.

National Coverage and Interviews With Our Team

The 2017 trial ruling prompted national coverage and interviews about what employers can say during a reference check.

• The Canadian Press, carried by CityNews: Read the report on our firm’s defence of the employer, including comments from Jon Pinkus.
• National Post: Read the coverage and our firm’s interview about the ruling.
• Radio: Listen to Gurlal Kler’s comments on the win in interviews with 640 Toronto as well as 610 CKTB in the Niagara Region.

What This Means For You

• A negative reference does not automatically create a successful claim. What was said, whether it was true and the circumstances of the conversation all matter.
• Agreeing to be a reference does not guarantee praise. Before listing someone, ask whether they can provide a positive reference.
• Severance is a separate issue. Even though the employer won the reference dispute, the employee was still owed additional severance pay in Ontario.

A Lesson For Employers

Keep references accurate, relevant and grounded in facts you can support. In this case, checking concerns with colleagues and acknowledging the employee’s strengths helped support the employer’s defence.

Related client win: Evidence also mattered when our team represented an Ontario tow truck driver whose employer could not prove its theft allegations. He won six months’ severance, and the employer’s counterclaim was dismissed.

Facing a Dispute Over a Job Reference?

If your business is facing a claim over a reference or dismissal, our employment lawyers can review the evidence and explain how to respond.

If you are an employee concerned about a reference or severance offer, our Ontario employment lawyers, including our Toronto team, can assess your situation. Severance can be as much as 24 months’ pay, depending on your circumstances.