Standard of Truth

• Texas employers are not liable for defamation of character if they release true information about an employee to a potential new employer, including employee evaluation information. Truth is the standard -- if the employer knowingly makes false statements to a potential new employer, he can be liable for defamation, but if the statements were true to the best of his knowledge, he is not liable and cannot be sued by the employee.
  
  

Telephone References

• Texas law doesn't forbid employers from giving references over the phone to potential new employees. However, providing detailed evaluations of an employee over the phone can lead to trouble. There's no way to prove that the caller is really a potential employer rather than someone looking for information for other reasons. If you give employment information over the phone to a nonemployer, you may be giving the employee ammunition to sue you for defamation or for invasion of privacy.
  
  

Inflammatory Language

• Inflammatory language can lead to a defamation suit even if the information is technically true. For example, if you say you fired someone because he's a thief or drug addict, the employee may have a defamation of character suit. But if you simply provide facts about what happened and that it violated your policies, you can easily prove that you told the absolute truth.
  
  

Other Relevant Laws

• As of the time of publication, employers may be liable for defamation if one employee lies about another during the course of a misconduct investigation. Employers should thus consult their attorneys about the best way to handle misconduct investigations. Employers also should get written releases from employees before conducting a background check or any other employee reference check so that they don't fall afoul of the Fair Credit Reporting Act.