Legislature(1993 - 1994)
03/08/1993 01:00 PM House JUD
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 147 - EMPLOYER'S LIABILITY FOR REFERENCE INFO Number 635 RENA BUKOVICH, LEGISLATIVE AIDE TO REP. EILEEN MACLEAN, PRIME SPONSOR OF HB 147, explained the bill. She stated that the bill would add a new section to the Code of Civil Procedure relating to job references, stating that an employer was presumed to be acting in good faith unless it was shown that a reference was knowingly false, deliberately misleading, given with malicious purpose, or violated the employee's civil rights. Number 650 MS. BUKOVICH commented that HB 147 was needed to encourage the exchange of information between a prospective employee and employer. She said the courts were overburdened with libel and slander claims based on negative job interviews and unfavorable employment references. She stated that many employers had stopped giving employment references entirely out of fear of lawsuits. She noted that passage of HB 147 was the number one priority of the Alaska State Chamber of Commerce. She added that it was modeled after a Florida law which passed without opposition. She noted that HB 147 was identical to HB 441, which passed the House unanimously the year before and died in the Senate Rules Committee. Number 660 REP. DAVIDSON asked Ms. Bukovich if the sponsor concurred with the amendment he was offering to HB 147. MS. BUKOVICH noted that Rep. MacLean did not oppose Rep. Davidson's amendment. Number 667 REP. KOTT asked Ms. Bukovich what the definition of "malicious purpose" was. Number 670 MS. BUKOVICH stated that "malicious purpose" meant acting with ill-will or with the intent to harm another individual. Number 685 JAMIE PARSONS, PRESIDENT OF THE ALASKA STATE CHAMBER OF COMMERCE (ASCC), testified in support of HB 147. He said the bill would protect employers who received inquiries about the job performance of employees or former employees. He stated that under the bill's provisions an employer who provided reference information to another employer would be presumed to be acting in good faith. Additionally, unless the reference could be shown to be knowingly false, deliberately misleading, and showing a lack of good faith, the employer could not be held liable for the disclosure or the consequences of the disclosure. Number 700 MR. PARSONS noted that there was a relatively small applicant base in Alaska, and it was therefore imperative that employers be able to share information in good faith. He said sharing information entailed a risk that many employers could not afford to take. He reiterated that passage of HB 147 was the number one priority of ASCC. Number 717 REP. JAMES asked when an employee's rights came into play under HB 147's provisions. Number 727 MR. PARSONS stated that as a small business owner, he treated the issue of employment reference disclosures seriously. He said that under the Senate version of the bill, employees would have access to written references. Number 735 REP. JAMES questioned the need for HB 147. Number 739 MR. PARSONS commented that there were many instances in which employers hired people "blindly" because other employers were afraid to disclose negative information about an employee. Number 749 REP. JAMES asked if information did not get carried over because prospective employers did not ask questions, or because former or current employers did not provide the information. Number 750 MR. PARSONS replied that previous or current employers, because of the risks involved, did not want to disclose much information about an employee. Number 760 REP. JAMES said she had not been aware that the problem existed. She said that many people called her for references and she disclosed information about people who had worked for her. Number 763 REP. KOTT asked if the Department of Law was going to testify on HB 147. He wondered if the situation addressed by HB 147 was already covered by "qualified privilege" laws. Number 768 CHAIRMAN PORTER noted that no representative of the Department of Law was available to testify on HB 147. He noted that as both a public and private-sector employer, he had been advised to disclose very little information about employees due to the risk of liability involved. Number 778 REP. JAMES commented that labor laws were fairly strict. TAPE 93-28, SIDE B Number 000 RESA JERREL, representing the NATIONAL FEDERATION OF INDEPENDENT BUSINESSES (NFIB), testified in support of HB 147. She stated that on the 1993 NFIB member ballot, 83 percent of respondents had supported this type of legislation. Number 020 MS. JERREL noted that in her former job she had been advised by an attorney to only verify her secretary's dates of employment, job title, and salary. She said that if she could have, she would have given her secretary a poor reference. She noted the growing nationwide problem of employers being sued by current and former employees over negative reference information. Number 030 MS. JERREL noted that one of NFIB's members had said that she would love to be able to get factual information on prospective employees because of a high turnover rate and problems with employees stealing from the till. Number 053 REP. DAVIDSON asked Ms. Jerrel to further explain the situation involving the NFIB member further. Number 062 MS. JERREL replied that the member said she spent a great deal of time hiring and firing people who abused drugs and alcohol and stole. The member had added that if she could get factual information from former and current employers, she would save a lot of time and aggravation. Number 070 REP. DAVIDSON asked why factual information was unavailable currently. MS. JERREL replied that, in the case of her former secretary, she assumed that the secretary's former employers had been advised not to disclose factual information. Number 075 REP. DAVIDSON asked Ms. Jerrel if she had ever confirmed that assumption. MS. JERREL responded that she had not. Number 082 MIKE MCMULLEN, of the DEPARTMENT OF ADMINISTRATION, testified in support of HB 147. He said that as a prospective employer, the state would like to know more about persons whom it was considering hiring. He noted that currently, the state encountered former employers who were reluctant to reveal much about employees. He said HB 147 would give employers more freedom to disclose information about former employees. He said HB 147 also would allow the state, as an employer, more freedom to disclose information about former employees. Number 120 REP. DAVIDSON asked if he would agree that HB 147 would immunize employers acting in good faith from civil action from former employees for disclosing information regarding a former employee's job performance. MR. MCMULLEN said he agreed with that statement. Number 130 REP. DAVIDSON asked Mr. McMullen if he felt that it would be difficult to prove that an employer was acting in bad faith. Number 138 MR. MCMULLEN commented that the appropriate place to address that issue was in court. He noted that under the bill a former employee would have a case against a former employer if the employer had given out incorrect information. Number 153 REP. DAVIDSON asked whether Mr. McMullen felt that HB 147 would help or hinder an employee's attempt to prove that an employer had acted in bad faith. Number 166 MR. MCMULLEN replied that he did not know that HB 147 would make any difference. Number 170 REP. DAVIDSON asked Mr. McMullen if he believed that HB 147 would put an employee at a disadvantage, in the event that the employee was falsely given a bad reference. MR. MCMULLEN expressed his opinion that HB 147 would not affect an employee's attempts to prove that an employer had acted in bad faith. REP. DAVIDSON gave a hypothetical example in which Mr. McMullen had been fired from a job in Alaska and went to Florida to look for another job. He asked Mr. McMullen if a former supervisor gave him a false bad evaluation, would HB 147 make it easier for him to prove that the employer had acted in bad faith? MR. MCMULLEN reiterated his opinion that his hypothetical case against his former employer would remain the same, regardless of whether or not HB 147 passed. Number 194 REP. KOTT commented on the agreement that had been reached between the Anchorage School Board and former District Superintendent Thomas O'Rourke. He said part of that agreement was that the school board would not convey any negative information to prospective employers of Mr. O'Rourke's. Number 202 CHAIRMAN PORTER noted that legal agreements could always be reached between an employer and an employee, and such agreements would not be prohibited by HB 147. Number 212 REP. DAVIDSON stated that such agreements would result in prospective employers not being protected against hiring bad employees, despite passage of HB 147. Number 220 WILLIE ANDERSON, of the NATIONAL EDUCATION ASSOCIATION- ALASKA (NEA-Alaska), expressed his organization's concerns about HB 147. He questioned how an employee could prove that an employer had given out false information. Number 249 REP. PHILLIPS said she would have assumed that NEA-Alaska would have taken the opposite stand on HB 147 than it had. She indicated her surprise at Mr. Anderson's comments on the bill. She asked, in the case of an elementary school hiring a new teacher, would it not be to the school's advantage to know of a teacher's background of sex offenses? Number 262 MR. ANDERSON agreed with Rep. Phillips. He clarified NEA- Alaska's stand that they wanted to ensure that information passed on to a prospective employer was factual. He said that, based on some comments that had been made in today's hearing, there was a danger of non-factual allegations being conveyed to a prospective employer. Number 275 CHAIRMAN PORTER asked Mr. Anderson whether or not NEA-Alaska supported passage of HB 147. Number 280 MR. ANDERSON noted that if HB 147 did not pass, the current practice of a former employer conveying limited information about an employee likely would continue. He said employers now commonly passed on information about employees, for which they had documentation. If an employer did not have documentation, employers generally did not pass on information because of fears of liability. Number 293 CHAIRMAN PORTER asked, if the employers to whom Mr. Anderson had referred had been advised to stop disclosing certain information, would they be likely to alter their practices? MR. ANDERSON replied that, in his opinion, they would likely alter their practices. Number 302 REP. GREEN commented that if HB 147 were to pass, and an employer received several positive references and one negative reference for a prospective employee, that would indicate that a personality conflict existed between the prospective employee and his or her one negative reference. He said that regardless of whether HB 147 passed, it was probably possible to take legal action against an employer for libel or slander. REP. GREEN noted that if he were an employer, he would want to know if a prospective employee had performed poorly on a previous job. He expressed his belief that HB 147 would be of great advantage to employers, particularly school districts. Number 331 MR. ANDERSON stated that he agreed with Rep. Green. He said NEA-Alaska supported an employer's divulgence of factual information, positive or negative. However, they were concerned that unproven allegations against an employee might also be transmitted to a prospective employer. Number 354 REP. DAVIDSON asked Mr. Anderson if he were aware of any instances of Alaska school employers being sued over employment references. Number 360 MR. ANDERSON said he had no knowledge of any such instance. Number 367 REP. DAVIDSON asked Mr. Anderson if he knew of any examples in Alaska in which teachers' employment records had been falsified. Number 370 MR. ANDERSON replied that no Alaska school district had been known to falsify a teacher's personnel record. However, he said individuals had put down false information on job applications and had been fired when the misinformation came to light. Number 380 REP. DAVIDSON questioned whether any employer had ever been sued for passing on accurate factual information to another employer. Number 386 REP. JAMES noted her belief that Alaska already had a law which protected people who stated their suspicions that another person engaged in sexual abuse. Number 395 MR. ANDERSON commented that public employee school teachers in Alaska were required to report suspicions of child abuse. Number 403 REP. JAMES asked, if a teacher was suspected of committing child sexual abuse, would that information be in a teacher's record? Number 408 MR. ANDERSON responded that a teacher's employer would be required to report such suspicions to the Division of Family and Youth Services (DFYS). REP. JAMES noted that this information might not then be passed on to a teacher's future employer. MR. ANDERSON indicated that it would depend on the outcome of DFYS' investigation. He said that a suspicion did not necessarily have basis in fact. He noted his concern that an employer might tell another employer that an employee was investigated for child abuse and not tell the rest of the story: that an investigation turned up no evidence of such conduct. Number 427 REP. NORDLUND said he could not imagine a situation in which information on a known child abuser was not passed on to a prospective employer. Number 431 REP. PHILLIPS noted that a situation like the one Rep. Nordlund described happened just the year before. REP. NORDLUND asked if passage of HB 147 would help to lessen the occurrence of such situations. REP. PHILLIPS commented on a situation in an Anchorage high school. The outcome of that situation, she noted, was an agreement that nothing about an alleged sexual contact with a student would appear in the teacher's record. Number 438 REP. NORDLUND noted that the individual about whom Rep. Phillips was speaking had not been convicted of a crime. He stated that an allegation, later proven to be true, had been made. Number 445 REP. PHILLIPS stated that when the teacher was no longer hired by the school district, an agreement was made whereby the teacher was not prohibited from taking a job in another school district. REP. NORDLUND stated that there could be situations in which a person was falsely accused. An employer who falsely believed accusations to be true could pass on that information to a prospective employer, who would then discriminate against the employee. Number 453 REP. DAVIDSON explained his proposed amendment, which would insert on page 1, line 12, after the word "given": "negligently, recklessly, or". He said that adding this language was the least that the committee could do to protect against individuals who would maliciously go after other individuals. He noted that the sponsor of HB 147 did not object to his amendment. He moved the amendment. Number 474 GAYLE HORETSKI, COMMITTEE COUNSEL TO THE HOUSE JUDICIARY COMMITTEE, stated that it appeared that the language in HB 147 was taken from a Florida law. She called the members' attention to page 1, lines 10-14. She said the bill was awkwardly written so as to indicate that information had a "culpable mental state." She suggested rewriting the bill so as to indicate that the mental states referred to in the bill belonged to the employer. Number 504 CHAIRMAN PORTER suggested that HB 147 be held in committee, and a committee substitute drafted to incorporate Rep. Davidson's amendment and to clarify the "mental state" language. Hearing no objection, it was so ordered. Number 513 REP. DAVIDSON asked that the committee be given more information on lawsuits that made HB 147 necessary in the first place. Also, he said he would like to know if Alaska had a complementary law which penalized employers for giving false reference information. Number 529 CHAIRMAN PORTER indicated that there was a wealth of information from representatives of employers that showed that HB 147 was necessary. Number 545 REP. DAVIDSON said he understood that a problem existed. However, he said that he wanted to know where it had been demonstrated, through the legal process, that a bill like HB 147 was needed. Number 551 CHAIRMAN PORTER announced that HB 147 would be brought before the committee again at the next available meeting.
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